fortune--2020-05-14--What took Uber so long to protect drivers and riders?

This is the web version of Data Sheet, Fortune’s daily newsletter on the top tech news. To get it delivered daily to your in-box, sign up here.
Good morning, Data Sheet readers. Tech writer Danielle Abril here filling in for Adam.
For the past several weeks during the coronavirus pandemic, Uber has been airing ads with a safety-first message that undermines its usual goal to increase revenue. “Thank you for not riding,” the ads say.
During a call with reporters on Wednesday, CEO Dara Khosrowshahi acknowledged the unprecedented move as the rides business has dwindled while people stay home. “It’s the first time I’ve ever run an ad asking consumers not to use my service,” he said. “But it was just the right thing to do.”
In the next few days, though, that message will shift. Uber is rolling out a new safety strategy during the “new normal,” as governments relax restrictions and people emerge from their homes.
Instead of telling riders to stay home, Uber will attempt to help riders feel comfortable about what it’s calling customers’ “second first ride,” or their re-introduction to Uber.
Starting Monday, Uber will require riders, drivers, and delivery people to wear masks, regularly wash their hands, and sanitize vehicles. It’s also asking all passengers to sit in the back seat and encouraging drivers and riders to crack open their windows for better ventilation. For drivers, it’s spending $50 million on safety supplies.
And drivers, riders, and Uber Eats restaurants can alert Uber any time a user doesn’t follow the rules, which could lead to deactivation from the service after multiple violations. Lyft implemented similar policies last week.
But what took these companies so long? The outbreak started to become widespread in the U.S. in mid-March, and it had received plenty of attention weeks prior in China then Italy and Spain.
During Wednesday’s press call, Uber did not address the delay. Rather, it explained that it had spent the last several weeks working on changes to its app to create a safe user experience and get ahold of safety supplies.
When the U.S. started to take action to slow the spread of the virus, Uber and Lyft did step in to provide rides to essential workers, help transit authorities provide subsidized rides for commuters, and help people get to doctor’s appointments. But while many drivers took precautions to protect themselves and their passengers, Uber didn’t require them to do so. Users were left to decide what was and wasn’t safe.
It’s great to see ride-hailing companies do their best to protect their customers and drivers. It would be even better if they were quicker on the draw.
Danielle Abril
@DanielleDigest
danielle.abril@fortune.com
This edition of Data Sheet was curated by Aaron Pressman.
NEWSWORTHY
Just gonna sit here and watch this. Locked-down people aren't just playing more video games, they're spending more time watching other people play video games, too. The audience for live streaming in April doubled overall from a year earlier, according to a report from StreamElements and Arsenal.gg. Amazon's Twitch led the pack with 1.5 trillion (!) hours watched, a 101% increase from last year. Facebook Gaming saw the biggest increase at 238%, to 291 million hours, fueled in part by the release of its own mobile app.
There's no champagne room. In a story that seems to offer a peek at organizational dysfunction, The Information reports that some leaders of Google's Pixel phone team have recently left. More disturbingly, Pixel boss Rick Osterloh told the team last fall that he didn't agree with the design decisions in the Pixel 4, notably the weak battery. Sorry, the boss was complaining about the product his own division made?
TikTok failure knock. The popular short video app has failed to live up to last year's agreement with the Federal Trade Commission to better protect the privacy of kids, according to 20 consumer groups. An age verification system isn't working and some videos that were supposed to be deleted remain available. TikTok said it was "committed to helping ensure that TikTok continues to be a safe and entertaining community for our users.”
Never mind. The case before the Supreme Court pitting Oracle against Google was thought to have major implications for the software industry. If APIs can be copyrighted, software compatibility is out the window. But signs are emerging that the high court may decide the case on narrow grounds that won't require concluding whether APIs are protected by copyright.
I could have been a contender, I could have been somebody. On Wall Street, Cisco exceeded expectations despite an 8% quarterly revenue decline to $12 billion and a forecasted sales drop for the year. Even Cisco's app unit, which includes WebEx, saw revenue drop 5%. Cisco's shares, previously down 13% this year, gained 3% in pre-market trading on Thursday. And satellite communications firm Intelsat filed for bankruptcy protection. Intelsat says it doesn't have the money on hand to meet the government's requirements for auctioning off some of its spectrum licenses for 5G. Shares of Intelsat, down 89% this year, closed at 79 cents on Wednesday.
FOOD FOR THOUGHT
Josh Ternyak is a front-end web developer and blogger based in Minneapolis. He's also 15 years old. Josh has 20 pieces of advice for other budding developers, though much of it applies to anyone who works. Take #11: Being Arrogant And A Know It All.
Not only does being arrogant make it very difficult for other people you're working with, it also makes it difficult for you. If you think you know everything, you won't actively listen to others to learn more. Put your ego aside, and be respectful and don't talk down to ANYONE.
The consequences of being arrogant are huge. Not only might you get fired, you'll also lose the respect of others. After years of me trying my hardest to get rid of this bad habit, I finally got past it. Ever since I stopped being arrogant, I learn much more than I did before, and retain what I learn.
IN CASE YOU MISSED IT
HBO Max sets release dates for second slate of original series By Aric Jenkins
Endeavor: Reports of our demise are greatly exaggerated By Andrew Nusca
Box CEO talks COVID-19, activist investors, and parenting By Jonathan Vanian
Intel pledges ambitious water-use goal by 2030: to go ‘net-positive’ By David Meyer
Tesla’s lockdown lawsuit is about much more than Tesla By David Z. Morris
Restaurant owners want and need more guidance on how to reopen from government officials By Rachel King
(Some of these stories require a subscription to access. There is a 50% discount for our loyal readers if you use this link to sign up. Thank you for supporting our journalism.)
BEFORE YOU GO
In need of a little humor at the expense of a billionaire who can afford it? The New Yorker published a spoof of Jeff Bezos' advice for getting through the pandemic. It's a gut-splitter, including this bit:
Take up a new hobby. Fly your drone into a cloud and see if you can find it again. Sue someone who doesn’t have the resources to engage. Sink a yacht just to watch how the water swirls. Tell your V.P. of distribution to kill a cow and see if he’ll actually do it. If you’re still going a little stir-crazy, why not stay in a different one of your houses every night of the week?
Aaron Pressman
@ampressman
aaron.pressman@fortune.com


fortune--2020-05-14--Intel pledges ambitious water-use goal by 2030: To go ‘net-positive’

COVID-19 is forcing Coach and Kate Spade to pick up the e-commerce pace

Intel has set out a range of environmental goals for the next decade, including a shift to 100% green energy, zero landfill waste from its manufacturing operations, and a target of “net-positive water use.”
In its latest Corporate Responsibility Report, out Thursday, the chipmaker also said it would double by 2030 the number of women and underrepresented minorities in senior management.
Crucially, Intel wants to use its clout to influence trade partners to take up the same corporate-responsibility ambitions through cross-industry standards and benchmarks. For example, it wants to help set up what it calls a Global Inclusion Index, which would provide common metrics that companies can use to track progress in boosting diversity across senior and technical positions.
“The world is facing challenges that we understand better each day as we collect and analyze more data, but they go unchecked without a collective response–from climate change to deep digital divides around the world to the current pandemic that has fundamentally changed all our lives,” said Intel CEO Bob Swan in a statement.
Intel came in at No. 4 on Fortune’s Change the World Sustainability All-Stars list last year, largely for its water-restoration efforts—the company is headquartered in drought-prone California. It already had a target of 100% water restoration from its manufacturing activities by 2025, but now it wants to go even further by 2030.
The concept of net-positive water use involves not only the optimization of consumption and heavy recycling of water—no easy task in an industry such as chip manufacturing, where wastewater is usually very toxic—but also capturing water from rainfall or storms, in order to put more back into the system than is taken out.
Intel said Thursday that it would collaborate with PC manufacturers to boost energy efficiency through the use of sensors and more efficient processor architectures (which is what every new generation of processor architecture has always aimed for: Sustainability aside, this enables processors to be used in new ways, such as in wearable technology.)
Ideally, Intel said, it wants to see a PC “that eliminates carbon, water, and waste in its design and use.”
On the health front, Intel is already a major contributor in the fight to quell the COVID-19 outbreak and to prepare for future pandemics. It is now more broadly talking about applying “technology in strategic manufacturing, transportation, and health care initiatives, including accelerating cures for diseases and improving health care.”
Intel also says it will push for global safety technologies and standards in the field of autonomous vehicles.
More must-read tech coverage from Fortune :
—Remote work, online grocery shopping, cord cutting: Which coronavirus trends will stick
—No buses, no problem. Some cities provide subsidized Uber rides amid pandemic
—How to choose a video-chat app? Grade it on privacy
—Listen to Leadership Next, a Fortune podcast examining the evolving role of CEOs
—WATCH: Zoom’s ups and downs since the coronavirus crisis
Catch up with Data Sheet, Fortune’s daily digest on the business of tech.


fortune--2020-05-15--How Syndio’s CEO raised $7.5 million for pay equity software with 6 kids at home

Germany sunk into recession in the first quarter as lockdowns began , government says

Maria Colacurcio was two months into raising a Series A round for her company, the pay equity software platform Syndio, when her constant travel from her Seattle HQ to the Bay Area—home to the investors she was courting—ground to a halt. Like many CEOs, she pivoted to conducting her company’s business from home. Unlike many CEOs, she had to get the job done with six kids in the house.
Under those extraordinary circumstances, Colacurcio today announced that Syndio has closed a $7.5 million Series A funding deal with lead investors Voyager Capital and the Emerson Collective, the organization that does a mix of nonprofit and for-profit work on behalf of Laurene Powell Jobs.
Although Colacurcio was raising money for Syndio at what may have been the worst possible time—the former Starbucks executive thinks the task would likely be easier now that companies have settled into the new realities of the pandemic—the platform’s product was able to break through. Colacurcio attributes that success to two seemingly contradictory factors. First, employers’ fear of facing litigation. “The list of companies facing gender pay litigation—it’s a who’s who of the Fortune 500,” she says. And second, “More progressive thinkers want to look back and be able to say they kept fairness in mind. Progressive leaders are focused on legacy: ‘How will I be judged post-COVID? Did I allow fairness to take a backseat?’”
Syndio’s platform enables companies to perform real-time analyses of employee compensation, catching discrepancies and creating what-if scenarios that model how those gaps change with every hire, promotion, or layoff. And while the software has been marketed as a tool to evaluate pay for current employees—its biggest competition comes from the law firms that traditionally perform annual compensation analyses—it can also be used as companies make decisions about layoffs. (Syndio used its own tool for that purpose: The startup has laid off seven of its 30 or so employees since the coronavirus crisis began.)
Investor Diane Fraiman of Voyager Capital, which funds early stage B2B software companies, sees the pay equity software as a “foundational building block of future-of-workforce disruption,” she says. Fern Mandelbaum, the Emerson Collective investor involved in the deal, views the product through the lens of workplace equity. Emerson, though private about its full portfolio of investments—the best-known is Powell Jobs’ backing of The Atlantic—is known for its mission-driven tilt; Mandelbaum teaches a Stanford Graduate School of Business course called “Equity by Design: Building Diverse and Inclusive Organizations.” “What you pay people is an incredibly clear measure of how you value people,” Mandelbaum says.
Syndio’s software is in use by about 60 clients, including Adobe, Match Group, Nordstrom, Slack, and Target. A handful of startups also compete in the space, although Syndio points to the sophistication of its software platform as a differentiator.
The program is already encountering new use cases during the pandemic. Companies are using Syndio to analyze the gender and racial trends in whom they have decided to lay off—and, once layoffs have been made, to do an updated pay analysis on their newly reduced workforce. Colacurcio says that some clients have told her they’ve had employees ask to have their comp packages adjusted as the company’s stock gets hammered amid concerns over the pandemic; those employers are using the platform to analyze the pay-equity impact of adjusting select employees’ stock-based compensation.
As Colacurcio pitched the platform to investors at the peak of corporate confusion—she never met her Emerson Collective backers in person—her husband, who owns a currently closed Seattle gym, took the reins on homeschooling and childcare for their kids, ages 2 to 13. Their daily break was an eight-person family neighborhood run.
“For two weeks at home, we’d all be sitting around the table, and they would say, ‘Mommy seems really stressed,’” Colacurcio says. “Then at the end, when I got the call, we were all sitting around that same table. It was cool to share the stress with them and the win of that moment.”


fortune--2020-05-15--The most admired Fortune 500 CEO is…

The most admired Fortune 500 CEO is…

This is the web version of CEO Daily. To get it delivered to your inbox, sign up here.
Good morning.
Which Fortune 500 CEO is most admired by their peers? Each year, as part of our annual survey, we ask the CEOs of the 500 which leader—other than themselves—they most admire. The top choice this year was the same as last: JPMorgan’s Jamie Dimon, who got 23% of mentions. Dimon’s candid style, as well as his leadership of the Business Roundtable, have cemented his respect among colleagues.
Moving up from last year was Walmart CEO Doug McMillon, mentioned by 16% of the CEOs, compared to 7% last year. And slipping back was Microsoft’s Satya Nadella, mentioned by 17% last year and 7% this year—putting him on a par with Amazon’s Jeff Bezos.
Other CEOs with more than one mention: Salesforce’s Marc Benioff, GE’s Larry Culp, Mastercard’s Ajay Banga, J&J’s Alex Gorsky, Apple’s Tim Cook, and Berkshire Hathaway’s Warren Buffett. Bill Gates, who is no longer a Fortune 500 CEO, also got three mentions.
When asked which one of the 500 companies they would invest in, CEOs took a different approach. Amazon shot to the top of the list, chosen by 40%—far ahead of second place Microsoft, chosen by 9%. JPMorgan got a single nod.
Asked which 500 company they would short, the CEO’s top choice was: Tesla. But Musk still wins my vote for the CEO with the most entertaining Twitter feed.
The new Fortune 500 list is out Monday—with a surprise in the top five. More news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
TOP NEWS
German recession
Germany's GDP shrank 2.2% in Q1 (that's quarter-on-quarter; year-on-year was 2.3%). The drop was entirely in line with analyst expectations, but still the country's worst quarterly GDP drop since Q1 2009. With German's Federal Statistics Office also revising Q4 2019 down to a mild drop, that means the country is now technically in a recession. In happier news, the latest estimated virus transmission rate in Germany is back down to 0.75, indicating success in keeping the coronavirus outbreak under control even while lifting restrictions, as Germany has been doing in recent weeks. Fortune
TSMC U.S.
The world's biggest contract manufacturer of silicon chips is to spend $12 billion building a plant in Arizona, according to the Wall Street Journal. Taiwan Semiconductor Manufacturing Co., better known as TSMC, is apparently responding to concerns in the U.S. about over-dependence on Asia for chip manufacturing. WSJ
Calhoun candor
Boeing CEO David Calhoun is less than popular with his customers after predicting that a major U.S. airline would likely go bust this year. His prediction, made in an interview earlier this week, apparently irked American Airlines CEO Doug Parker, who called Calhoun to complain. Given the state of the airline industry right now, Calhoun may not have been wrong—but saying it out loud was never going to win friends. WSJ
Solvay cuts
And here's another indication of aerospace-sector misery. The Belgian chemicals firm Solvay is closing two of the plants where it manufactures cutting-edge composite materials for planemakers Boeing and Airbus—570 jobs, or around 20% of Solvay's workforce, will go. Solvay had already started cutting costs due to the Boeing 737 Max groundings, but COVID-19 will mean further drops in demand for civil aircraft. Bloomberg
AROUND THE WATER COOLER
Richard Burr
Republican Senator Richard Burr, who is being investigated for alleged insider trading, has temporarily resigned his chairmanship of the Senate Intelligence Committee after it emerged that the FBI had searched his house, seized his cellphone, and served a warrant on Apple to provide information from his iCloud account. Burr: "I believe this step is necessary to allow the committee to continue its essential work free of external distractions." Fortune
WeWork burn
WeWork's cash burn for Q1 was 60% lower than the previous quarter, clocking in at a *cough* mere $482 million. Luckily for the office-space firm, whose business has obviously been hit hard by the coronavirus pandemic, it had already initiated huge cost-cutting measures in the wake of its abortive IPO debacle last year. Financial Times
WTO chief
Roberto Azevêdo is to step down as director-general of the World Trade Organization at the end of August, more than a year before his second term was due to end. The Brazilian's departure comes during a time of partial paralysis for the WTO, due to the U.S.' blockage of judges to its appellate body—a move that essentially means the WTO can't settle trade disputes, which is sort of the point of the organization. Deutsche Welle
Clinical trials
COVID-19 could change how the pharmaceutical industry performs clinical trials. As Fortune's Erika Fry writes here, the pandemic is forcing more stripped-down trials that break with orthodox approaches, though many argue there has never been a greater need for rigorous, well-designed clinical trials. Fortune
This edition of CEO Daily was edited by David Meyer.


fortune--2020-05-15--Will COVID-19 change how Big Pharma does clinical trials?

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Sumathi Sivapalasingam, senior medical director at Regeneron, the New York–based biotech, has spent recent weeks, like many Americans, working from home. But even hunkered down in her Brooklyn apartment, Sivapalasingam, an infectious disease specialist and physician who previously worked at Bellevue Hospital and battled outbreaks around the world for the CDC, has felt very much in the thick of the fight against COVID-19.
When Fortune spoke with her in early April, she was spending nearly every waking moment on the phone, speaking with clinical trial investigators and physicians about Kevzara, a rheumatoid arthritis drug developed by Regeneron and Sanofi, the French pharmaceutical firm, that is being studied as a possible treatment for the most critically ill COVID-19 patients. The companies are actively testing the drug—an immune signal blocker that researchers hope will brake the deadly inflammation seen in the sickest patients—in a randomized, double-blind, placebo-controlled trial conducted at over 50 sites around the globe.
Such a trial has long been considered the gold standard in medicine—the design most likely to produce unbiased and meaningful results—but it’s not easy to pull off in the middle of a pandemic. Among the calls Sivapalasingam has received are heart-wrenching ones from friends, family, and physicians who find themselves treating dying colleagues and loved ones: Could Regeneron help?
Sivapalasingam is helping oversee Regeneron trials from her home in Brooklyn. RANI LEVY—REGENERON
“There’s this feeling, ‘What do we do? We’ve done everything, and they’re dying,’ ” says Sivapalasingam, who notes the personal connection trial investigators feel with some trial participants, while poignant, is just one of many challenges involved in running a rigorous, blinded clinical study in the time of COVID-19. One of the Regeneron investigators became infected and, for a time, oversaw his site’s study while quarantined. The process of getting informed consent from critically ill patients—whose relatives may well be sick or quarantined themselves—has also proved tricky. So, too, is getting robust data on the condition of study participants when there’s a global shortage of personal protective equipment (PPE).
“Even taking temperature can require burning through very, very scarce PPE,” says Sivapalasingam. For Kevzara, she adds, many of the trial assessments have been made optional. “We’ve peeled off anything but what’s most essential for us to maintain high data quality.” To assist health care workers—already overstretched by the demands of treating patients—Regeneron has sent teams to help collect data at non-research hospitals.
As enormous as those challenges are in the current moment, Sivapalasingam, her colleagues, and many of their scientific peers around the world argue that rigorous, well-designed clinical trials have never been more important—or sorely needed.
“Research was really a bit of an afterthought to dealing with the crisis,” says Martin Landray, a professor of medicine and epidemiology at Oxford. “As a consequence, certainly in Italy, lots of different drugs were used in large quantities in lots of patients, but at the end of it, nobody was any the wiser on whether any of them had done any good or done any harm.”
Indeed, as the novel coronavirus has swept around the globe with frightening speed, sickening millions and killing tens of thousands in brutal and baffling ways, the general impulse has been to try anything that might conceivably work. Up against a crush of patients on the brink of death, physicians around the world have tried a slew of old compounds—including the antimalarial drug hydroxychloroquine, which President Trump eagerly promoted—without much evidence to support them.
There have been enormous numbers of small, low-grade studies which are frankly a waste. Martin Landray, professor of medicine and epidemiology at Oxford
“People want to help [patients], and they want to be quick. They are forgetting a little bit the lessons we’ve learned in history,” says Pamela Tenaerts, executive director of the Clinical Trials Transformation Initiative, founded by the FDA and Duke University. During the 2009 H1N1 flu pandemic, an investigational drug called peramivir was made available under an emergency-use authorization. Nearly 1,300 seriously ill patients in the U.S. were given the drug, but according to a 2015 study published in The New England Journal of Medicine, “No reliable data on effectiveness were derived from this use.”
There are currently 1,476 COVID-19 clinical trials listed in the U.S.’s National Institutes of Health database, but experts say few are the sort of large, robust studies needed to tease out conclusive findings.
“There have been enormous numbers of small, low-grade studies which are frankly a waste,” says Landray. “One thinks about the number of patients who’ve gone into those studies. If I’m putting them into adequately large, robust, randomized controlled trials, then we would have answers to so many questions by now.”
It was that realization that led Landray, in early March, to design the Recovery trial, which has become the world’s largest study of COVID-19 drugs. Conducted across the U.K.’s National Health Service and open to any hospitalized COVID-19 patient, the trial, which is currently studying the effectiveness of five drugs, enrolled more than 9,000 patients.
In its straightforward approach, the Recovery study is a radical departure from the modern clinical trial, which, Tenaerts says, often suffers from a “Christmas tree effect,” ornamented with clinical questions. Says Landray of the trial’s stripped-down nature: “You have to let go of your orthodoxies, your traditions. Focus on what matters and forget the rest.” Hopefully that’s a shift in thinking that will outlast the pandemic.
Four studies to watch
Recovery (trial)
When Oxford professor Martin Landray found himself on a bus seated next to Jeremy Farrar, director of the global health charity Wellcome Trust, the two decided the U.K. needed a large, simple, and flexible trial that could quickly compare the performance of possible COVID-19 treatments. Designed in days, the trial has enrolled more than 9,000 COVID-19 patients as participants.
Solidarity (trial)
Similar to the U.K.’s Recovery trial, this WHO-run study is testing multiple drugs in the treatment of COVID-19 patients around the world. WHO estimates it will take 80% less time than the average randomized trial.
NIAID
The National Institute of Allergy and Infectious Diseases’ randomized, controlled trial of remdesivir, an antiviral developed by Gilead, made headlines after early data suggested the drug may hasten recovery from COVID-19. Remdesivir is being studied in other trials around the world, including in the WHO’s Solidarity trial (see above).
Regeneron
The biotech has one drug, Kevzara, already in trials, and expects to have another—an antibody cocktail to treat COVID-19 patients and serve as a prophylaxis to protect the most vulnerable—in June.
A version of this article appears in the June/July 2020 issue of Fortune with the headline “Trials by fire.“


fortune--2020-05-15--Why China will dominate the virus-free world

Hong Kong stock exchange boss Charles Li remembers the hardships of life in China before it opened to global trade. He grew up in northern Gansu, one of the country’s poorest provinces, during Mao Zedong’s Cultural Revolution, and toiled on oil rigs in the Bohai Sea as a teenager after the Soviet Union cut off oil exports to China.
Deng Xiaoping’s 1979 decision to welcome trade and investment from the West lifted hundreds of millions of Chinese from poverty—Li among them. He went on to earn a law degree from Columbia University and lead the China offices of Merrill Lynch and J.P. Morgan before ascending to his current perch as the highest-paid executive in Hong Kong’s financial industry. In his ten years as CEO of Hong Kong Exchanges and Clearing, Li has been an outspoken advocate of globalization, championing bold reforms that made it easier for global funds to invest in China’s stock market and Chinese companies to list in Hong Kong.
So it was something of a shock when, minutes into a conversation with Fortune’s Grady McGregor and me this week, Li mused that if China had to close its borders again, it would do just fine.
“Today, if we were closed again, we are already 100 times richer, 100 times more affluent, 100 times more resourceful” than in the Mao years, he said. “I don’t think being closed is necessarily the end of the world [for China], if it has to go that way.”
Li wasn’t urging a return to isolationism. He assured us Beijing doesn’t share Washington’s enthusiasm for “de-coupling”—the idea that the world’s two largest economies, after four decades of growing interdependence, must now pry themselves apart. “China does not want to decouple,” he said.
Rather, he seemed to be suggesting that, as a practical matter, the U.S.’s inability to contain the coronavirus leaves China no choice but to seek social—and economic—distance from the nation that has been its most important trade partner. The problem, Li said, is that the two countries have fundamentally different ideas about how to combat the virus. Li described China’s mindset as “zero-tolerance.” “They want [the virus] to be fully gone before they are ready to kick everything off.” But President Donald Trump is urging Americans back to work even as the number of new infections exceeds 25,000 per day.
China’s dilemma, Li said, is that it can’t remain virus-free “unless they permanently lock the country up, and don’t let foreigners come in.”
That dilemma may recede as other economies match China’s success in containing the virus. Time, in a recent report, notes that economies in the Asia Pacific region, which have curbed contagion faster and more effectively than counterparts in North America and Europe, already are experimenting with reopening their borders to select travellers.
Hong Kong, which has recorded only a handful of locally transmitted cases of the infection over the last several weeks, has introduced a plan to permit some business travellers and students from China’s mainland to enter the city without quarantine. Officials are discussing measures to expand quarantine-free travel to nearby Macau, the former Portuguese colony, which has reported no new cases in over a month.
China began accepting some business travellers from South Korea on May 1 on the condition that they are tested for the virus upon arrival and remain at a government facility until cleared by the results.
Australia and New Zealand are discussing plans for a “trans-Tasman bubble” allowing quarantine-free travel between the two nations.
It’s not difficult to imagine these bubbles gradually growing and joining together, reordering the world into Zones of Immunity—where people, goods, and capital resume circulation with relative freedom—and Zones of Infection, whose inhabitants are stuck within their own borders, unwelcome in any nation but their own.
China will be the dominant economy in the immune zone. In the absence of an effective COVID vaccine, the U.S. seems destined to be the last of the pandemic pariahs.
Grady has a detailed account of our conversation with Charles Li here, where you’ll also find a video excerpt.
This is the first in a series of digital dialogues we’re calling Eastworld Connect. In weeks to come, Fortune will bring you similar exchanges on matters of business, tech, and finance with executives, experts, entrepreneurs, and investors from around the region. Stay tuned!
More Eastworld news below.
Clay Chandler
clay.chandler@fortune.com
This edition of Eastworld was curated and produced by Grady McGregor. Reach him at grady.mcgregor@fortune.com.
Eastworld news
A war of escalating memos
It’s been quite a week in U.S.-China tensions. Last Saturday, the Chinese foreign ministry released an 11,000-word memo called ‘Reality Check of U.S. Allegations Against China on COVID-19,’ which, unsurprisingly, attempts to rebut 24 allegations the U.S. has made against China over the pandemic. On Wednesday, U.S. officials released a report alleging that Chinese hackers had targeted American universities and pharmaceutical companies in an attempt to steal information related to COVID-19 vaccine and treatment research. What's more, on Friday U.S. President Donald Trump said he no longer wished to speak with Chinese President Xi Jinping and suggested cutting off the whole bilateral relationship. SCMP
New outbreaks
After six people tested positive for COVID-19 in Wuhan, the city announced that it is testing its entire population of 11 million people. It looks like there may be holdups to initial plans to accomplish that feat in ten days, but authorities still seem on track to complete the monumental task not long after the initial deadline. New outbreaks in China’s northern Jilin province and South Korea have similarly been met with aggressive containment measures. Such outbreaks appear to be setbacks for countries that had largely tamed the pandemic, but scientists told Fortune this week that it was inevitable that small clusters of coronavirus would emerge as countries open up their economies. The important thing is to detect the outbreaks early and act quickly and decisively to squash them. Fortune
Spit and test
Fortune’s Naomi Xu Elegant this week wrote about her experience taking a coronavirus test in Hong Kong. Thankfully, she tested negative, but her story offers a rare look at the at-home saliva test that is widely deployed in Hong Kong but rare elsewhere in the world. “For me, the at-home test provided pain-free peace of mind that I was not infected with coronavirus,” she writes. Fortune
Listings forge ahead
On Thursday, U.S. President Donald Trump said the American government is “strongly looking at” the Chinese companies listed on U.S. exchanges. The comments follow the Luckin Coffee scandal, in which the Chinese coffeehouse chain listed on the New York Stock Exchange was found to have fabricated its financial results in early April. Chinese companies seem undeterred for the time being. Since the Luckin news broke, two Chinese companies have listed on the New York exchange. Dada, a crowd-sourced delivery platform, went forward with its New York filing on Wednesday, and is expected to raise $500 million. Kingsoft Cloud, a Beijing-based cloud computing company, raised over $500 million in its debut a week ago. Bloomberg
A looming humanitarian crisis
Bangladesh reported the first two cases of coronavirus on Thursday in the world’s largest refugee settlement that holds over 1 million Rohingya refugees. The refugees, who fled Myanmar in 2017 to avoid ethnic persecution, live near the southern Bangladesh city of Cox’s Bazar. The new cases have sparked fears of a potential humanitarian disaster, as these camps, which are some of the most densely-packed living conditions in the world, would theoretically provide ripe conditions for COVID-19 to rapidly spread. Al Jazeera
A peoples response
Hong Kong is one of the densest cities in the world, and its proximity to mainland China made it especially vulnerable to coronavirus. Yet five months after China reported the first cases of COVID-19, life in the city is largely back to normal; it's recorded just 1,000 or so cases and four deaths. In an Atlantic piece this week, University of North Carolina professor Zeynep Tufekci outlines how social organization born from the city's protest movement helped citizens mobilize to monitor virus hot spots and keep cases low. “The secret sauce of Hong Kong’s response was its people and, crucially, the movement that engulfed the city in 2019,” she writes. Atlantic
Greater Bay Area
Plans to transform southern China into a high-tech, integrated powerhouse advanced one step further on Thursday as China announced a slew of measures to enhance economic ties between Hong Kong, Macau, Guangzhou, and Shenzhen. These cities make up the heart of what China calls the 'Greater Bay Area,' a policy initiative to elevate the region to compete with the likes of Silicon Valley. The measures on Thursday are aimed at facilitating more cross-border investments and trade, and also include making Macau a more attractive destination for offshore Chinese yuan currency, setting up a futures exchange in Guangzhou, and raising more yuan-denominated funds for China's Belt and Road Initiative. Bloomberg
Coronavirus by country
Singapore was once lauded for its coronavirus response. Now, COVID-19 is exposing the city’s migrant workforce underbelly. Like other countries in Asia, Singapore had learned from its experience with SARS and initially had managed to keep case counts low with strong social controls, extensive contact-tracing, and a world-class health care system. In early April, Singapore reported just 1,000 cases of COVID-19. Yet today, Singapore has recorded over 26,000 cases and 21 deaths. The surge in cases reflects the city's narrow focus on its own citizens, which came the expense of its migrant worker dormitories, where over 1.4 million people, many from Malaysia, reside. The government only this week announced a comprehensive response: a plan to test 300,000 people living in migrant worker dormitories. CNN
Markets and movers
TSMC – Taiwan Semiconductor Manufacturing Company, one of the world’s largest chipmakers, confirmed on Thursday that it would invest $12 billion into building a chip factory in the U.S. New York Times
Gilead – The American pharmaceutical giant signed a deal with five generic pharmaceutical companies in India and Pakistan to produce remdesivir, an antiviral drug that has shown success in reducing symptoms of COVID-19. Gilead will not charge royalties on the drug until a vaccine is found or the World Health Organization declares an end to the COVID-19 public health emergency. BBC
Luckin Coffee – CEO Jenny Qian and COO Jian Liu were both terminated from their positions in another blow to the Chinese coffeehouse chain that has been spiraling downward since it came to light on April 2 that the company had been fabricating sales numbers. WSJ
Final figure
26%
On Thursday, Tencent, the Chinese social media and tech giant, posted 26% growth in revenue in the first quarter of 2020 compared to the same period in 2019. The company’s success in a quarter in which China’s economy was largely locked down is attributable to a boom in gaming that occurred as people in China were confined to their homes. Tencent is more famous for its messaging app WeChat, yet Internet gaming is the company’s most profitable division. In September, Fortune sat down with Colin Yao, the head of Tencent’s largest in-house game developer Timi Studios for his first interview with foreign media. “We’ve experienced so many transformations, from the PC gaming era, to the mobile gaming era, to 4G, with high-quality battle games, to today’s globalization era,” he said at the time. Tencent was certainly well-positioned for this latest transition—to the coronavirus era. Fortune


fortune--2020-05-15--Germany sunk into recession in the first quarter as lockdowns began, government says

How Syndio ’ s CEO raised $ 7.5 million for pay equity software with 6 kids at home

The German economy shrank 2.2% in the first quarter, the most in more than a decade, offering an early flavor of the damage from the coronavirus outbreak.
Less than two weeks of official lockdown caused slumps in consumer spending and capital investment. Government spending and construction provided some stabilization.
A 3.8% slump in the euro-area economy led to a decline in employment, the first since 2013.
A revision to Germany’s fourth-quarter performance means Europe’s largest economy is already in a recession. With restrictions to contain the pandemic only slowly being lifted, the economy is set to suffer much more in the three months through June.
The euro and German bunds barely reacted to the data. The single currency is trading little changed from the previous day.
The German government has already mobilized some 1.2 trillion euros ($1.3 trillion) to support German businesses, and is working on additional tools to kickstart the economy. More than 370,000 people lost their jobs in April alone, and a program where the state compensates large parts of wages lost when businesses cut workers’ hours has received applications for more than 10 million staff.
Finance Minister Olaf Scholz on Thursday promised a stimulus program in early June that will focus on investing in a “modern and climate friendly future.”
The Italian government passed a stimulus package worth 55 billion euros this week to try to prop up the economy, after a previous 25 billion-euro plan in March was deemed insufficient. The decline in industrial sales and orders in the country exceeded 25% in March.
Even though the situation is dire, Germany isn’t faring as poorly as much of the rest of the euro area. France, Italy and Spain have all registered first-quarter contractions of around 5%. The Dutch economy shrank 1.7%.
What Bloomberg’s Economists Say…
“Assuming restrictions are eased broadly as the government plans, and light-touch social distancing measures follow, output will be down 5.5% this year.”
— Jamie Rush, chief European economist. Read the GERMANY INSIGHT
Germany’s Economy Ministry expressed confidence on Friday that the country has already seen the worst of the coronavirus slump. “The recovery began with the cautious lifting of the lockdown at the beginning of May,” it said in an emailed statement. “But this process will take a longer time due to the continuation of the corona pandemic.”
The European Central Bank has also offered some hope that the economy start improving in the second half. At the same time, policy makers including the ECB’s vice president and the chief economist have cautioned that the speed and scope of the recovery will depend chiefly on confidence returning to consumers.
In China, industrial output increased in April for the first time since the virus outbreak, suggesting the economy is starting to recoup losses. Yet retail sales extended their decline.
In Germany, Volkswagen AG was forced to cut back production at its largest car factory this week after gradually restarting assembly lines last month, pointing to weak customer demand. Sportswear maker Puma SE forecasts the current quarter to be worse than the previous one, warning that the pandemic is crushing sales.
Restaurants and hotels probably won’t operate at full capacity as long as there’s no vaccine or treatment for the coronavirus, and supply-chain disruptions mean exporters will continue to struggle.
Hapag-Lloyd chief Rolf Habben Jansen said Friday he anticipates the pandemic will have “very significant impacts in 2020, beginning in the second quarter.” Still, the container shipping company maintained its 2020 earnings forecast, counting on a gradual recovery in the global economy in the second half.


fortune--2020-05-15--Hong Kong Stock Exchange CEO sees city as intermediary in renewed U.S.-China feud

After 10 years at the helm of the Hong Kong Stock Exchange, chief executive Charles Li made the surprising announcement last week that he is stepping down.
“I’m already the longest-serving chief executive of [HKEX], so I think it’s time to make a change. It’s time for the board to begin looking for the next generation,” Li, 59, told Fortune on Wednesday, in his first public interview since the decision.
Li’s contract runs out in October 2021, and he said he is committed to leading the exchange until either that time or until the HKEX board finds his replacement. But in the meantime, he will face one of the most challenging periods of his tenure as COVID-19 wreaks havoc on global financial markets. The HKEX is unique in that it regulates exchanges, performs clearing services, and operates as a private company whose shares trade on its own exchange. The Hang Seng Index, which measures the performance of the top companies on the HKEX, is down roughly 16% for the year, compared with 18% for the Dow Jones industrial average. HKEX revenue declined 7% in the first quarter year over year, while profit declined 13%.
In navigating this new environment, Li said that Hong Kong and China’s ability to reopen more quickly than Western peers means the global economic recovery will likely stem from Asia.
“[China] and the U.S. seem to be running on a very different clock, different logic, a whole different operating system,” Li said. “That difference is going to count a lot on how the global recovery is going to be. Because it’s not going to be universally similar, it’s going to be very different.”
But even if China leads the way, he said its long-term success will depend on foreign markets recovering from COVID-19.
“China has a huge vested interest in everybody else succeeding because otherwise [the virus] will come back to China,” given the global nature of today’s society, he said.
But that shared interest hasn’t materialized yet, at least in public forums. Rather, the virus has escalated tension between the U.S. and China, repositioning Hong Kong in the world’s business ecosystem, as the resurgent anti-Beijing protest movement threatens the city’s long-standing status as an open, free gateway to China.
“From a relative importance perspective, [Hong Kong] will probably become more important,” said Li. As China and the U.S. drift farther apart, Hong Kong’s role as a bridge—facilitating communication and business between the two powers—is more vital.
At the same time, Hong Kong is subject to China’s growing influence. In recent weeks, Hong Kong authorities have arrested 15 veteran anti-Beijing activists, and China’s government liaison office to Hong Kong said that Beijing is not bound from interfering with local affairs in the city.
As head of the HKEX, Li’s position in these matters is especially precarious. On the one hand, Hong Kong markets are trusted by international investors, owing in part to the city’s relative autonomy from Beijing and its independent legal system. On the other, the HKEX is deeply tied to China, as roughly half of its listed companies are from the mainland.
Li concedes—albeit delicately—that Hong Kong’s existence in the future will differ from how it has operated in the past. “Whether or not we are as free, we are as open, we are [politically as we were before]…Are we going to have to scale back certain things that we were used to before? Clearly, we are all going through that process,” he said. Nevertheless, he still considers Hong Kong an important intermediary.
In fact, Li embodies that role, seeing himself as a “translator of trust” between mainland China and Western markets. He’s uniquely suited for the task, given his upbringing in China and earlier career working for U.S. banks.
Who is Charles Li?
Li grew up in China’s northwestern Gansu province amid the turmoil of the Cultural Revolution and was put to work on an offshore oil rig at age 16. He later studied English literature at a Chinese university and worked as a journalist for China Daily, a state-run English-language newspaper, before heading to the U.S. for graduate school in 1986.
HKEX CEO Charles Li Xiaojia (right) shakes hands with Alibaba Group’s executive vice chairman Joe Tsai during the company’s listing ceremony at the Hong Kong Stock Exchange on Nov. 26, 2019. Zhang Wei—China News Service/VCG via Getty Images
He graduated with a master’s degree in journalism from the University of Alabama in 1988, but quickly switched paths and enrolled in Columbia University’s law school that same year. After law school, Li worked on Wall Street as an investment banker for Merrill Lynch, and eventually became head of the company’s China division in 1999. In 2003, he became chairman of J.P. Morgan China and led the bank’s China operations for six years.
Li took the job of HKEX chief executive on the heels of the Great Recession in January 2010. During his tenure, HKEX’s revenue has more than doubled to $2.1 billion in 2019. Li is the first mainland Chinese national to run the exchange, and has turned HKEX into the most attractive initial public offering market in the world; it’s been the top IPO destination for seven of the past 11 years.
Li’s success has come, in large part, from his efforts to maximize Hong Kong’s proximity and ties to China; to connect global investors with mainland companies. In 2014, Li helped launch the Shanghai–Hong Kong Stock Connect, allowing investors in each exchange to trade shares on the other’s market. In 2016, he spearheaded a similar scheme to connect HKEX with the Shenzhen stock exchange. And last November, Li helped lure Chinese tech giant Alibaba to list on the HKEX. Alibaba originally listed in New York in 2014, but chose to do a secondary listing in Hong Kong after Li spearheaded efforts to reform HKEX so companies with dual-class share structures could list on the exchange. The offering raised $11.2 billion and smashed the record for the exchange’s largest-ever listing. For his efforts, Li has earned the moniker “Mr. China.”
New challenges
Li’s ambitions, however, have not always born fruit. Last year, HKEX made a $36 billion bid to buy the London Stock Exchange, the highest-ever offer for a stock exchange. The offer was quickly rejected by LSE’s board.
Even with the failed bid and his own tenure coming to a close, Li said that future acquisition attempts are not out of the question: “When you make efforts like that, you don’t just one day say, ‘Oh, nice one,’ and it’s over.”
Still, he said, COVID-19 will likely delay any additional acquisition offers for the time being. The coronavirus crisis has shifted focus to issues like speeding up the IPO process for companies listing on HKEX. Li noted that it currently takes an average of six days between IPO pricing and trading in Hong Kong, whereas the same process in the U.S. takes one day.
He’s also confident the IPO pipeline of Chinese companies listing in Hong Kong will remain robust as China’s economy emerges from the pandemic. In fact, Hong Kong may become a more attractive option for Chinese companies as they face new pressure in the U.S., he said.
In recent weeks, American authorities have increased scrutiny of Chinese companies listed on U.S. exchanges after it came to light that Luckin Coffee, a Chinese coffeehouse chain listed on the New York Stock Exchange, recently fabricated financial results.
“Americans will be best served if Chinese companies are allowed to succeed there,” said Li. “But if in the short term, for whatever reason, they are not welcomed, we always welcome that.”
However, he isn’t encouraging companies with poor governance to list on HKEX, calling Hong Kong’s regulatory climate “robust.”
“For bad apples, we should all be collectively united to deal with it, so that there is no regulatory arbitrage that people can take advantage of,” he said. “But for good companies, everybody should welcome them.”
In an office overlooking Hong Kong harbor on the 50th floor of the HKEX office building on Wednesday, Li pointed to several statues of bulls displayed on shelves on one wall. He said the bulls, which symbolize the growth of financial markets, were gifts from various companies and investors.
The one-sidedness of the display is not lost on the executive who’s spent a decade at the fulcrum of East versus West.
“Why does everyone only give us bulls?” Li joked. “Sometimes we also need bears.”
This story and video are part of Eastword Connect, a series of conversations on matters of business, tech, and finance with executives, experts, entrepreneurs, and investors in Asia. Subscribe to Fortune’s Eastworld newsletter to get them in your inbox.


fortune--2020-05-15--Investors shake off brutal U.S. jobs data to nudge markets higher

This is the web version of the Bull Sheet, Fortune’s no-BS daily newsletter on the markets. Sign up to receive it in your inbox here.
Happy Friday, everyone. It looks as if we could end the week on a positive note. European investors are particularly bullish today after Germany GDP numbers came in roughly in line with estimates. Meanwhile, in the U.S., there are fresh warnings the recovery could be a slow one.
Let’s see what’s moving markets.
Markets update
Asia
The major indices are mixed this morning with Japan’s Nikkei leading the way higher, up 0.6% in afternoon trade. Hong Kong and Shanghai were flat.
this morning with Japan’s leading the way higher, up in afternoon trade. and were flat. The choppy performance is in line with new data showing China’s industrial production jumped well above consensus estimates, but retail sales were down last month.
jumped well above consensus estimates, but were down last month. Meanwhile, there’s fresh concerns of a second wave of COVID-19 infections in Hong Kong, mainland China and South Korea.
Europe
The European bourses jumped out of the gates. The bluechip Stoxx Europe 600 was up 0.9% at the open.
was up at the open. German GDP fell 2.2% , roughly in line with estimates. The Dax was up 1.5% .
fell , roughly in line with estimates. The Dax was up . Germany’s Lufthansa plans to quadruple its flight schedule beginning next month. International destinations include Mumbai, Toronto and Los Angeles .
plans to beginning next month. International destinations include and . Sanofi’s COVID-19 vaccine is still in development, but it’s already causing an international spat between the French, the U.S., and the rest of the EU over who would get it first.
U.S.
The Dow , S&P 500 and Nasdaq futures are trading higher, looking to extend yesterday’s gains.
, and futures are trading higher, looking to extend yesterday’s gains. Yesterday’s late-day rally was led by financial stocks as the prospect of negative rates is looking more remote. A reminder: negative rates is a tax on savers, pensioners and banks themselves. The lessons from basket-case Europe and Japan is a stark one: once you go negative, it’s extremely difficulty to climb out of that hole.
was led by as the prospect of negative rates is looking more remote. A reminder: is a tax on savers, pensioners and banks themselves. The lessons from basket-case Europe and Japan is a stark one: once you go negative, it’s extremely difficulty to climb out of that hole. “I think a V–shaped recovery is off the table.” For the second time this week, Minneapolis Fed President Neel Kashkari is warning that should Congress not act, the American recovery will be a slow, painful grind.
Elsewhere
Gold is up, as is the dollar .
is up, as is the . Crude too is finishing the week strongly with Brent back above $32/gallon.
By the Numbers
36.5 million. Yes, we lead with jobless numbers again. That’s how many workers in the United States have now filed for unemployment benefits over the past eight weeks. Yesterday’s tally of roughly 2.98 million jobless claims was another week-on-week improvement, but still came in well above analysts’ consensus. The real unemployment rate could be as high as 21.1%, well above the lagging official rate (14.7%) announced last Friday.
40 and 63. Fed Chairman Jerome Powell’s address earlier this week spotlighted just how uneven the economic fallout of the pandemic is hitting Americans. Here are two data points, best told in Tweets.
-0.32%. After yesterday’s late-afternoon run, the Nasdaq closed at 8,943.72. The tech-laden index is down for the week, bringing it back into the red for 2020. But not by much. It’s trading a mere 0.32% below its New Year’s Eve close.
Postscript
Italy is having a very uneven pandemic. Up north, in and around hard-hit Milan, the health crisis continues to smolder and flare up. Meanwhile, most points due south of there are doing just fine. In Lazio, the region that includes us here in Rome, the “R” reproduction rate stood at roughly 0.3 yesterday. Anything below 1.0 is where you want to be to flatten the curve.
The contagion is an even lower risk in Umbria, home to such medieval gems as Orvieto, Perugia and Assisi. I know this primarily because my in-laws, hailing from Umbria, are quick to point out on FaceTime calls and in WhatsApp messages all the ways they are winning la pandemia. Yesterday, they proudly sent me a Daily Telegraph article with the catchy headline touting why Umbria “should be your first holiday after lockdown.”
No place in the world (outside of Antartica) is Covid-free, but Umbria is about as close to zero-risk as you can get. And the region is already angling to capitalize on its epidemiological advantage over other sunny destinations. The region’s development agency on Wednesday put out the message (in English and Italian): Umbria is ready for tourism.
Never mind that it’s near impossible for international tourists to get in and out of land-locked Umbria these days. Airlines continue to cut summer flights as the European Union struggles to find a cohesive plan to save its $2 trillion tourism industry. It’s even off-limits for us here in Rome at the moment (that could be relaxed on Monday, however).
From the Azores to the Greek Islands, this is a dilemma facing all vacation hot spots. It’s looking like the summer of stay-cations, and that will really put the crimp on the many regional economies, like the Umbrian economy, dependent upon tourism.
But let’s imagine a day in the near future when it’s safe to travel again. If an Italian getaway is still on your bucket list, you could do worse than choosing an Umbria vacation. It’s a land rich in history, art, fabulous food and wine. And, in the summer it’s full of sagre, local festivals in hilltop towns. The whole idea is to feast on the local dish in the company of townsfolk, eating sumptuous meals on plastic plates, washed down by jugs of local wine. They’re humble affairs, but they always draw a crowd.
I can almost taste le pappardelle and the cinghiale in umido.
***
Have a nice weekend, everyone. I’ll see you here on Monday.
Bernhard Warner
@BernhardWarner
Bernhard.Warner@Fortune.com
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Today's reads
Etsy bitsy climber. The handcrafts e-commerce bazaar, Etsy, has stitched together one heck of a year. Shares edged up a mere 0.1% yesterday, but it's absolutely crushing it in 2020. It's rocketed higher by more than 150% since its March low. Fortune's Phil Wahba explains what's driving all that growth.
Intelligence Committee. Yesterday saw a major development in the Senate insider trading case. Sen. Richard Burr (R-N.C.) stepped down as chair of the Senate Intelligence Committee amid reports the FBI is moving forward with its investigation into the high-powered lawmaker over his suspicious sale of shares in February. He's not the only senator under suspicion, as Rey Mashayekhi explains.
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Market candy
Lord of the flies, revisited
A few months ago, I picked up a copy of Lord of the Flies, William Golding's classic novel, and began reading it to my girls each night before bed. We never finished. I had to put it down not long after Simon's death, one of the most eerily beautiful passages in 20th Century literature. Simon's death was the last straw for the girls. They rebelled. Enough of these stupid boys!, they demanded. Yesterday, I came across Rutger Bregman's vivid piece in the Guardian about a real-life Lord of the Flies situation that was nearly lost to history. It's a gripping tale. A good weekend read.


fortune--2020-05-15--J.C. Penney files for bankruptcy and plans to close a number of stores

Drive-in theaters are back .
These are the movies you can see , and where you can see them

J.C. Penney, an iconic retailer founded in 1902 in Wyoming, has filed for Chapter 11 bankruptcy protection, slammed by years of dwindling sales, a huge debt burden, and a pandemic that has closed stores for weeks.
The department store chain said on Friday it had landed $900 million in debtor-in-possession financing to ensure operations continue while it wields its way through bankruptcy. Penney said it would close an unspecified number of stores in its 850-store fleet—media reports have suggested that number is 200. Net losses for the company totaled $4.2 billion between 2011 and 2019.
The bankruptcy is a stunning fall from grace for a retailer that at one point was surpassed only by Sears in size and importance in American life.
The filing was voluntary and supported by lenders holding approximately 70% of J.C. Penney’s first lien debt. The bankruptcy will erase several billion dollars of Penney’s indebtedness and help it navigate the enormous hit to sales stemming from the COVID-19 pandemic. Penney’s long term debt stood at $3.6 billion as of the end of February. The case will be overseen by federal bankruptcy court in Corpus Christi, Texas.
While the company has been struggling for years—net sales in 2019 were $10.7 billion, down from $19.9 billion in 2007—and has failed to reinvent itself enough to keep shoppers despite many turnaround attempts in the last decade, chief executive Jill Soltau suggested the COVID-19 outbreak pushed it over the edge.
“The closure of our stores due to the pandemic necessitated a more fulsome review to include the elimination of outstanding debt,” said she said in a statement.
Though a few stores have reopened, with many offering curbside pickup for online deliveries, Penney’s business is still taking a big hit. Apparel and home goods, its two biggest categories, saw the biggest pullback in U.S. retail sales last month. In a sign of how hard the quarter has been, department store Dillard’s said this week its gross profit margin on merchandise had fallen by two thirds to 12.5%.
The Penney bankruptcy is the third high profile Chapter 11 filing in two weeks, following Neiman Marcus and J.Crew. Sears, its longtime rival, filed for Chapter 11 in late 2018, but its business has continued to shrivel, dampening hopes for Penney’s prospects. Green Street Advisors, a real estate research firm, said last week in a note that it expected Penney to eventually liquidate because of a business that has been adrift for years.
Penney said in its release that as part of the deal for the bankruptcy, it would explore a number of options including selling the company.
For now, as detailed in a Fortune analysis on Friday, Penney will have to figure out how to finally reconnect with customers that have long since defected to the likes of Target, T.J. Maxx, Ulta Beauty, and even Macy’s, its bigger and financially stronger though injured rival, at a time shoppers are dealing with a tough economy and are limited in ability to shop.


fortune--2020-05-15--Reddit offers cryptocurrency: Is this a game changer?

Social news site Reddit announced on Thursday it will let users earn cryptocurrency by contributing content and participating in discussions on the service. Many in the crypto world hailed the news as a major milestone, pointing to the hundreds of millions of Reddit users who could potentially embrace digital currency.
The actual impact of Reddit’s move is likely to be muted, however, owing to how the site is awarding the cryptocurrency, and the ongoing regulatory scrutiny of crypto.
As it turns out, Reddit will offer digital currency on only two of its many “sub-Reddits”—the site’s discussion forums devoted to specific topics. The first of these, unsurprisingly, is a sub-Reddit for cryptocurrency, while the other is dedicated to chatter about the online game Fortnite.
Contributors to the sites will receive one of two currencies Reddit has minted (known as Moon and Brick) and which it will track on a popular blockchain called Ethereum—a digital ledger technology similar to Bitcoin. Unlike Bitcoin, however, the new currencies can only be spent on Reddit to acquire badges and other trinkets and can’t be used as a form of money more broadly.
This may ensure Reddit stays in the good graces of financial regulators, who have looked dimly on more ambitious digital currency projects by other social media sites like Facebook and the messaging app Telegram. In the case of Telegram, the company’s CEO this week announced it was canceling plans to sell millions of dollars’ worth of tokens called Grams. Telegram’s announcement came after a judge backed the Securities and Exchange Commission’s position that the Grams sale appeared to be an unregulated investment scheme.
By contrast, Reddit’s decision to restrict the Moon and Brick currencies to its own website means they are more akin to loyalty points, or the digital “gold” users of the site have long been able to give to one another.
“It’s a form of in-app rewards points where no one is treating it as an investment—putting it on a blockchain doesn’t turn it into one,” says Preston Byrne, a cryptocurrency authority at the law firm Anderson Kill.
Byrne cautions, however, that Reddit could face scrutiny down the road if it distributes the cryptocurrencies more broadly, or if the “Moons and Bricks” begin to take on value in the real world.
In response to a query from Fortune about the future of its digital currencies, a Reddit spokesperson described them as an experiment.
“We continuously run experiments to explore features that engage our users and communities. With Community Points, we’re working exclusively with two communities to test this feature and gather feedback from our users,” said the spokesperson.
The upshot, according to Byrne, is that the Reddit initiative is not a game changer for cryptocurrency adoption. He notes it doesn’t provide a compelling new use case, or a reason for non-crypto fans to adopt it. Byrne did, though, praise the Reddit experiment as a “cool development.”
Reddit’s gambit may prove useful in the long run, providing the site with a beachhead from which to launch a broader and more versatile cryptocurrency in the future—when, and if, regulators’ attitudes change.


fortune--2020-05-15--Drive-in theaters are back. These are the movies you can see, and where you can see them

The coronavirus has now killed more Americans than the Vietnam War , Gulf War , Afghanistan War , and Iraq @ @

Close your eyes and picture a drive-in movie theater. Imagine an expansive grassy field lined with cars, each vehicle turned toward a towering screen bathed in projector light. See the couples, families, and solo adventurers munching on snacks and laughing at the antics on-screen. Hear the film’s dialogue warbling through radio sets dialed to the local station.
This panorama would seem like a dream set in the 1950s, but it’s not. It’s 2020—and the drive-in is back.
While the novel coronavirus pandemic has emptied out indoor cineplexes, concert venues, and sports arenas, the nostalgic, near-obsolete practice of parking under the stars to see the latest flick is back in business. (Though diehards would say it never disappeared.) Just over 300 drive-in movie theaters remain in the U.S.—a far cry from the more than 4,000 that were operating during their ’50s heyday—but these relics now offer one of the few viable forms of outdoor entertainment in the midst of widespread stay-at-home measures.
Outdoor cinemas have received the blessing to reopen from a number of state governors including Tony Evers of Wisconsin, Phil Murphy of New Jersey, and Andrew Cuomo of New York. The trend could very well spread across the nation as more states cautiously lift COVID-19 restrictions on businesses. Drive-ins are a natural candidate for relief given the inherent social distancing of being inside a parked personal car.
So in which states are drive-in theaters open, or planning to open soon? And exactly what kinds of movies can you expect to see? Will blockbusters from major studios make their premieres under the night sky? Read on to find out.
Which drive-in theaters are open?
Rules and guidelines for drive-ins vary by state. Some states are allowing only regions that have passed certain measures, such as a lowered percentage of new COVID-19 cases, to open businesses like drive-ins. And because of the constantly evolving nature of government response to the pandemic, any list of open businesses can change week by week or even daily.
Wannabe drive-in attendees will need to check the guidelines of their local districts before making their way to the theater. But as of May 15, drive-ins have resumed business in some capacity in the following states:
Alabama
California
Connecticut
Florida
Georgia
Idaho
Illinois
Indiana
Kansas
Missouri
New Jersey
New York
North Carolina
Ohio
Oklahoma
Pennsylvania
South Carolina
Tennessee
Texas
Utah
Wisconsin
The status of drive-ins remains less clear in other states. Take Virginia, where Family Drive-in Theatre owner Jim Kopp told the Washington Post he had the okay from Gov. Ralph Northam’s office to reopen. The paper described the permission as “apparent,” as the governor’s office did not respond to its request for comment (nor did it from Fortune).
Other states, like Washington and Michigan, remain steadfast in the decision to keep drive-ins closed despite protest from theater owners. In the case of Michigan, a drive-in owner defiantly told the local outlet Battle Creek Enquirer: “We’re open. We’ll wait and see what happens.”
John Vincent Jr., president of the United Drive-in Theatres Association of America, told CNN on April 24 that at least 8% of drive-in theaters had remained open despite restrictions on nonessential services. He later told the Post on May 2 that he expects around 150 theaters to reopen over the next three weeks as states relax their restrictions.
What movies can you see at drive-in theaters?
All sorts, depending on the theater. Some drive-ins are screening classics: Riverside Drive-In in Armstrong County, Pa., for example, returns to action this Friday with a double-feature of The Wizard of Oz and Twister. Others, like the Warwick Drive-In Theater in Warwick, N.Y., are opting for titles from the past year. Its May 15 through May 21 slate includes Bad Boys for Life, The Invisible Man, Bloodshot, Jumanji: The Next Level, Sonic the Hedgehog, and Trolls World Tour.
What about brand-new movies that haven’t been released yet? Major studios have pushed back most of their significant releases, opting to hold them for later this year or release a few titles straight-to-digital, as in the case of Trolls World Tour. Two of the earliest currently scheduled releases, Warner Bros.’ Christopher Nolan thriller Tenet and Disney’s Mulan remake, are due to open in theaters nationwide—yes, indoors—in July. Should the pandemic prevent enough standard indoor cineplexes from opening, it is unlikely the studios would premiere them solely in drive-ins.
Some notable players are getting creative with the drive-in. Amazon Studios is screening its yet-to-be-released sci-fi thriller The Vast of the Night across 34 drive-ins on May 15 and May 16. An Amazon rep tells Fortune that the film’s theatrical run could extend further, ahead of its May 29 release on the Prime Video streaming service. Because of the 1950s setting of the film, Amazon has partnered with the majority of the drive-ins to offer ’50s-era admission prices: 50¢ per car.
The indie world is turning to the drive-in as well. Distributor IFC Films has released a half-dozen films to select outdoor theaters owing to the pandemic’s impact on the theatrical release calendar. Supernatural horror film The Wretched earned nearly $70,000 from 12 drive-in theaters on its first weekend; more than $200,000 in its first two weeks. Given its indie status, the fact that it has been available to rent on digital platforms, and the current coronavirus climate, it’s considered a hit for IFC.
“The interesting thing about this moment in time is that anything is possible,” Lisa Schwartz, copresident of IFC Films and Sundance Selects, told the Associated Press. “We saw an opportunity early on to continue to entertain audiences with drive-ins and thought The Wretched had the right DNA for the big outdoor screen.”


fortune--2020-05-15--The coronavirus has now killed more Americans than the Vietnam War, Gulf War, Afghanistan War, and I

The coronavirus has now killed more Americans than the Vietnam War, Gulf War, Afghanistan War, and Iraq War combined

The coronavirus has infected nearly 1.4 million Americans, and claimed the lives of 83,947 since outbreaks spread across the nation earlier this year.
The total lives claimed by COVID-19 in the U.S. is already higher than the 67,830 troops who died in every war since the start of the Vietnam conflict in 1964. And the 27,448 deaths in New York are closing in on the 36,574 U.S. deaths in the Korean War.
Of course pandemic deaths and soldiers killed in wars are two very different types of loss. But it does help to understand the sheer magnitude of the virus and its devastating effect on U.S. lives.
While the 83,947 COVID-19 deaths are still far below the estimated 675,000 deaths attributed to the Spanish flu, it’s nearing the 100,000 U.S. deaths from the 1968 pandemic.
And the virus is still well below the leading causes of death in the country. Heart disease and cancer the leading causes of death in the country. Those two will likely still be the top two killers again this year. But COVID-19 is moving up quickly—and would likely be higher without the shutdowns and social distancing.
Despite stay-at-home orders, coronavirus deaths are projected to continue to rise. A biostatistician at the University of Massachusetts Amherst has merged various COVID-19 forecasts, and projects 110,000 deaths by June 6. That would be just shy of the 116,516 U.S. deaths in World War I.


fortune--2020-05-15--Surf’s up and so are new beach rules to prevent coronavirus spread

They arrived at the beach by car, skateboard and on bare feet. They carried Frisbees, cameras and surfboards. They wore running shorts, yoga pants and wetsuits.
Many wore masks.
That was the starkest difference this week apart from a moment in time in March that seems hard to conjure now — before beaches closed and face masks seemed like an extreme and maybe even ineffective protection from coronavirus.
No longer. Masks are now required at Los Angeles County beaches, which reopened Wednesday, to join counterparts in other states that have allowed a somewhat limited return to famed stretches of sand.
“You get some side eyes if you don’t wear a mask,” said Tom Ventura, who sported a light blue face covering with white polka dots while cooling down after his morning run Thursday in Santa Monica.
Along the California coast and in states known for silky sands, warm waters and ample sun, the surf is up along with a new set of rules posted in the time of the coronavirus pandemic.
Beachgoers in LA County have to remain active — walking, running or swimming. No sunbathing. No picnics. No volleyball. Parking lots, piers and a popular 22-mile (35.4-kilometer) bike path that strings together Santa Monica, Venice, Manhattan and Torrance beaches are also closed.
Similar rules are in place throughout the state, as well as in Florida and Hawaii, though masks are not required at many beaches. Tanning and even picnics are permitted in some places, though people are generally told to only spend time with family members and not gather in large groups.
While beaches in South Florida — Miami and Hollywood — remain closed, beaches in Pinellas County on the Gulf of Mexico allow chairs and towels in the sand but limit groups to no more than 10 people. Signs urge people who don’t live together to remain 6 feet (1.8 meters) apart.
“I think it’s a little much, especially being outside with the sun and everything,” said Britt Mask, a Georgia man on vacation with his family at Indian Rocks Beach, near Clearwater, Florida. “I understand why it’s being done.”
In Hawaii, exercise is allowed on beaches on Oahu, but Honolulu police warned people sitting on the sands of Waikiki that they needed to be in the water or moving along.
On the East Coast, New Jersey Gov. Phil Murphy issued guidance Thursday to officials in shore towns on reopening beaches, directing them to set occupancy limits and spacing requirements. Popular tourist spots like Point Pleasant and Seaside Heights, home of “Jersey Shore” fame, were opening Friday. New York Gov. Andrew Cuomo also announced that beaches will open with limits in time for Memorial Day weekend.
In Greece, with an early heat wave hitting the country over the weekend, more than 500 organized beaches — where umbrellas and lounge chairs are available for hire — were opening Saturday morning, with strict social distancing measures. Free public beaches opened a few weeks ago. Authorities issued warnings when some crowds formed, but beach-goes generally appeared to heed health guidelines.
Beaches closed in many places as stay-at-home orders got stricter after people, who were allowed to exercise, took the opportunity to escape confinement and flocked to the coast on balmy weekends. Public health officials were concerned large gatherings could allow the virus to spread.
Andrew Noymer, a public health professor at the University of California, Irvine, said it was sensible to start reopening beaches and see how it goes. People should make their own risk assessment, but he said the sun helps kill germs and the virus is less likely to spread in the ocean.
“We have to start reopening the United States slowly and smartly. We can’t just keep everyone locked inside for 12 months,” Noymer said. “If we can’t run on the beach then how on Earth can we go to a restaurant or a movie theater?”
A day into the Los Angeles reopening Thursday, turnout was lighter than the day before.
“Yesterday was like the first get-out-of-jail-free card,” said Peter Moore, who was wearing a white hospital-style mask and walking with his wife and dog. “If they open up the parking lots, we’ll see if people are sitting on top of each other. There’s a lot of sand out there.”
The biggest challenge for lifeguards was reminding people they needed to wear masks, said Pono Barnes, a spokesman for LA County Fire Department.
Surfer Lana Song, who was overjoyed to be back in the water after the closure upended her morning ritual and led to her gaining 5 pounds (2.3 kilograms), was confused about the mask rule that applies on land but not water. She didn’t know where she would put a mask while riding waves.
Mlak Sahli, a student from Saudi Arabia studying public health, said it felt liberating to return even though a police officer shooed her and a friend for sitting on the beach.
A small group of surfers were treated to a rare sight when a pod of about 20 dolphins surfaced and swam by, said Peter Lockwood.
Lockwood said he wasn’t concerned about catching the virus in the water.
“Not a chance. There was so much air moving there and no one wants to be that close,” he said. “Everyone wants their own wave.”


fortune--2020-05-15--Marking four years of this race beat journey

This is the web version of raceAhead, Fortune’s daily newsletter on race, culture, and inclusive leadership. To get it delivered daily to your inbox, sign up here.
Before we (briefly) Haiku our way into whatever passes for a weekend these days, I wanted to take a breath to express my sincere thanks to all of you: RaceAhead turns four years old today.
I’ve been looking forward to this moment for three years and 364 days. At launch, the newsletter seemed impossibly daunting. Daily content about the one thing that nobody really wants to talk about? I imagined I would default to coverage of barely-budging diversity data, profiles of inspiring chief human resource officers, and sage reminders to not be a racist jerk at Halloween. Instead, the world served up white supremacist rallies, police shootings, children in cages at the U.S. border, debates about Robert E. Lee, and a commander-in-chief who traffics in dangerous and racist rhetoric.
I went there and you went with me.
Honestly, I wouldn’t have pitched this beat. But it was my two bosses, Alan Murray and Clifton Leaf—then the head of Fortune the brand inside Time Inc., and editor-in-chief of the magazine, respectively—who saw an opportunity in the marketplace of ideas for Fortuneto lead this vital conversation and decided to take some strategic risks in digital, print, and purpose. The world affirmed their instincts, but the biggest risk they took was on me.
I am so grateful to all of you who read and share and ping me on all the socials, to the extraordinary DEI professionals who have taken the time to make sure I understand what’s at stake, and to my peerless colleagues who make me smarter and more courageous every day. A special thank you to my edit-partner Tamara El-Waylly who shares the load and patiently saves me from myself on the regular. She is a true believer.
Truth be told, I miss the pre-pandemic raceAhead, in part because building it daily had become such a big part of how I understand the world. But the fierce urgency that described life before has become a global emergency of disparate impact now. I’m struggling to get my arms around how to cover it all, but I find solace in knowing that I’m not alone.
It is always you, dear reader, who is doing the real work. My new mantra: I represent the village that raises me daily. I hope you’re taking good care.
I will end with the wisest of words from the Broadsheet’s Kristen Bellstrom. She was one of the first people I turned to before I launched this damn thing. Her advice turned out to be ideal for anyone facing an important, intimidating, and risky new adventure—like we all are now.
Don’t have an opinion before you have an opinion, she advised. Take a breath and think it through. “It’s okay to cover something the next day, it’s better to be sure you know how you feel about it.” Next, find people to advocate for you and ask for help when you need it. Then, the brass tacks: “If you survive the first three months, you know you’re going to make it.”
Now, here’s a tribute to you, in Haiku.
You do the work, you
make the way. You shine the light.
Now: Go out and play.
Wishing you a happy and (socially distant) playful weekend.
Ellen McGirt
@ellmcgirt
Ellen.McGirt@fortune.com
On point
Googlers claim the company is dialing back on its diversity initiatives And the nightmare begins, right? According to eight current and former Google employees who have been sharing their stories with NBC News, the move is designed to help the company avoid the appearance of an anti-conservative bias. One popular program called Sojourn, a racial justice program that focused on helping employees navigate bias and difficult conversations about race, has been cut completely. “It does not want to invite lawsuits or claims by right-wing white employees about Google discriminating against them,” said one employee. Melonie Parker, Google’s chief diversity officer, disputes the claims, saying that the company is "maturing our programs to make sure we’re building our capability.”
NBC News
Mastercard CEO Ajay Banga: “Inclusion is a fancy word for human decency” On our latest episode of Leadership Next, Fortune’s podcast on leadership practicing stakeholder capitalism, Ajay Banga was unflinching in his commitment to inclusion, in the workplace and across the financial world. It was a fascinating dive into how the economic recovery can and should raise people up, rather than deepen divides. “The first thing you have to do is look after your people,” Banga told Alan Murray. “That is all part of thinking through inclusion. Inclusion is a fancy word for human decency.” On the flip side, you’ll also hear me ask Blackrock global strategist Kate Moore on what the recovery might look like, which companies are poised to thrive and what is keeping her up at night. (Spoiler alert: inequality.) A must listen and share, and do us a solid and smash that like button.
Leadership Next
Breonna Taylor was an EMT worker She was 26 years old when fatally shot by police in her home in March. The outrage (rightfully) continues to grow, and her family has filed a wrongful death lawsuit. As an emergency medical technician, she formed part of the essential workers on the pandemic’s frontlines—a hero. But, as Jamil Smith writes in this Rolling Stone commentary, “[w]hat value is celebrating an ‘essential worker’ if, when the uniform comes off and she rests in her own bed, her blackness makes her disposable?” This is a must-read as Smith explores the double standard of the “‘hero’ status” and how it enables a racist system that fails to protect all.
Rolling Stone
The beautiful battles of Verzuz The premise was instantly exciting: Two musical artists with at least 20 songs appear on Instagram Live and perform head-to-head. Fans vote on the winner. It turned out to be perfect quarantine-viewing—surprising, spontaneous, unscripted, and with the production values of a garage band practice session. The idea was created by producers Swizz Beatz and Timbaland and launched in March. Now, fans like Michelle Obama, Adele, and Jay-Z are tuning in. Some battles fizzled; the latest one, starring Erykah Badu and Jill Scott, was more of a lovefest. Special mention to music executive Andre Harrell, gone too soon, who understood early on that Verzuz was less about chest-thumping swagger and more about “black musical excellence.”
Washington Post
Librarians will save us all, along with grad students and actual experts A massive grassroots coalition of volunteers, calling themselves the Librarian Reserve Corps has been sorting, curating, and categorizing the massive crush of information about COVID-19 that has been generated. The goal is to push the right information to the right people who are working on pandemic-related issues. Elaine Hicks, education, research, and public health librarian at Tulane’s Rudolph Matas Library of the Health Sciences, started the effort. “This is an organically developing organization,” she told Library Journal. “It has no ownership, no budget, no bureaucratic guidelines.”
Library Journal
Coronavirus in the community
On background
Annalise Keating, we barely knew you Kellee Terrell, a filmmaker and journalist, digs into the complex legacy of How To Get Away With Murder, a complex television series worthy of the Shonda Rhimes imprimatur, and filled with chaotic-yet-compelling characters you just can’t quit. They generate a lot of dead bodies for law school students, too. But Terrell singles out Annalise for a special mention, and the brilliant way Viola Davis used her to transform the entertainment industry. “An openly bisexual character whose struggles with alcoholism and childhood abuse, as well as her unscrupulous legal tactics (among other things), made her one of the most complicated black women in television history,” she writes.
New York Times
Come to find out, Kyrgyzstan has a big rap scene And it’s been going on long enough to have hip-hop elders who acknowledge their place in the genre's continuum. “At some point, Africa Bambaata and Grandmaster Flash laid the foundation for this shit, and today the streets are ready to give their recognition,” said one such OG named Belyi. Western hip-hop was smuggled into the country in the 1980s via illegally traded tapes, restricted by the then Soviet Union. The kids made due on their own, and hip-hop became the soundtrack of the early days of Kyrgyzstan independence, which was declared in 1991. But hold up: The country has its own millennia-long tradition of musical improvisation, and improvisational poets are known as акындар, or akyns. Akyns hooray, hey, ho.
Calvert Journal
Why the “backfire effect” makes it hard to change your mind This utterly delightful tale, told in a graphic romp, is a wonderful explainer for why, despite your best efforts, you are predisposed to believe some facts more than others. And why, despite all good sense, some new information will make you explode into a fit of rage, and other new information won’t. It has to do with your brain. Counterarguments to core beliefs are perceived as physical threats to your well-being. So, when you tell Cousin Peggy that black lives matter, her brain interprets that information like a predator just burst into the room. Don’t believe me? Click through. Just promise to read to the end.
The Oatmeal
Today's mood board
Ellen McGirt
The family business


fortune--2020-05-15--This fintech needed workers so badly it started hiring employees’ roommates and spouses

When the coronavirus pandemic struck, cryptocurrency firm Kraken found itself in an enviable position: Like a handful of other industries, such as cleaning and video streaming, crypto companies faced an influx of new business.
Investors, including new and existing customers, were coming to Kraken in droves, and the company found itself desperately short of staff to meet the new demand. At the same time, CEO Jesse Powell began hearing stories of how the pandemic was leading to massive unemployment—including among the friends and loved ones of his employees.
In response, Powell came up with an idea to address both challenges: He turned to Kraken’s staff to help him fill 100 new customer service positions. In March, the company sent out a Google Survey to all of its 800 staff members, asking them if someone in their household wanted a job with Kraken.
Over a quarter of employees replied yes, and Kraken had nearly 400 referrals. Giving priority to applicants who said they were in dire financial straits, the company quickly made 101 job offers, which led to 94 hires.
The new hires include Stella, a one-time foreign exchange trader, whose daughter directed her to the open position, and Ana, a university scientist, the significant other of a longtime Kraken employee. (Kraken declined to provide last names, citing its privacy-centered corporate culture).
“We’ve hired people’s wives, husbands, mothers, children and roommates,” said Christina Yee, Chief Brand Officer at Kraken.
The new employees hired during the pandemic include a restaurant manager, a cook, and those with backgrounds in TV, law enforcement and hotel work. In their role at Kraken, they are verifying client accounts to ensure the company complies with banking laws, and replying to customer inquiries. The initiative has been so successful that Kraken is launching a second round of hires to add 100 more people.
The new hires are located in the U.S., Europe and other countries around the world, and nearly all are starting at $15 an hour. In some cases, this amounts to less than their previous wages but, at a time of Great Depression-level unemployment, it’s at least a steady job. Each new worker also received a corporate laptop in less than two weeks—a feat of logistics of which Yee is particularly proud.
Yee adds that Kraken’s unorthodox hiring strategy has provided additional benefits. Namely, the fact the new hires already co-habitate with Kraken colleagues has resulted in accelerated training, and has made it easy for them to communicate client pain points to others in the company.
Kraken says some of the new hires are already being promoted to new positions, and that it intends to keep all of its new staff in the future provided the crypto markets remain bustling. The company’s strategy was helped by the fact that staff worked remotely to begin with. But it could also help establish a precedent as more firms contemplate ditching their offices for an online work environment, and explore new types of hiring.
“Everyone is more productive because of the ability to share insights, and because they’re less worried about their loved ones,” Yee says.


fortune--2020-05-15--What to expect on network TV during the 2020-2021 season

The 2019–20 U.S. television season saw itself shortened or revised in many cases as a result of the novel coronavirus pandemic. Upfront presentations—where networks court ad dollars while showing off their fall lineups—planned for this time of year have also been canceled (or at least reworked). But that doesn’t mean TV networks aren’t planning for the 2020–21 season (even if it’s unclear when episodes may actually be able to air).
In fact, some networks announced renewals well before the coronavirus crisis evolved into a full-blown pandemic.
Though some long-running series—including Modern Family and The Good Place—have officially said goodbye to viewers, a number of them are expected to return. Some new shows will return for a sophomore year. Though the futures of some programs remain undetermined, here’s what the networks have in mind (so far) for the next season of TV:
Midseason launches may be the safest bet against coronavirus disruptions
Many series launches will wait until midseason if recent announcements from Fox and The CW are any indication. On Thursday, The CW said it would delay 10 original series till January, while another seven could debut anywhere between April through June 2021. Supernatural, which would have seen its final episode air around this time, will be the rare show to return in the fall if production gets back on track. Acquired series like Tell Me a Story and Swamp Thing will help fill the network’s pre-January schedule.
Franchises are still king
LL Cool J (Special Agent Sam Hanna) and Chris O’Donnell (Special Agent G. Callen) on “NCIS: Los Angeles,” which was renewed by CBS for another season. CBS via Getty Images
All hail NCIS. After CBS announced what it was picking up last week, it was clear that the flagship franchise and its spinoffs still hold a lot of value at the network. The original NCIS was renewed for its 18th season, while spinoffs NCIS: Los Angeles and NCIS: New Orleans respectively got a 12th season and seventh season order. Dick Wolf’s FBI shows—FBI and FBI: Most Wanted—are also returning for new seasons.
Speaking of Dick Wolf procedurals: Over at NBC, Law & Order: Special Victims Unit, which became the longest-running prime-time live-action series last fall, is supposed to come back for another three seasons. And after years away from the show, Christopher Meloni’s Elliot Stabler is expected to appear in the show’s 22nd season premiere. (And bonus for Stabler fans: The character is also slated to be the focus of a new spinoff series, which received a 13-episode order.) Wolf’s Chicago Fire, Chicago PD, and Chicago Med are also all set to come back for three seasons each.
At Fox, 9-1-1 will get a fourth season, while spinoff series 9-1-1: Lone Star is expected to come back for a second, as per an announcement made last month, though they’re now moving to midseason amid programming shifts.
Long-running series (whatever the genre) remain safe bets
They may not be franchises along the lines of NCIS or Law & Order, but a good number of TV’s mainstays aren’t going anywhere anytime soon. At ABC, Grey’s Anatomy, which bypassed ER earlier this year as the longest-running medical drama, is supposed to come back for seasons 16 and 17. Even though coronavirus-linked production troubles have hit the network’s Bachelor series hard, The Bachelor should come back for season 25, The Bachelorette is renewed for season 16, and Bachelor in Paradise is also renewed for season seven.
Perhaps unsurprising to no one, Fox is bringing back The Simpsons, which is renewed through season 32. Family Guy, once the victim of cancellation in the early 2000s, will come back for season 19. Bob’s Burgers will also be back for an 11th season.
…but there is such a thing as too much nostalgia
All TV shows aren’t meant to live on forever, even with long-running franchises and TV revivals becoming the norm on our screens these days. Beverly Hills 90210 revival BH90210, which aired last summer on Fox, was canceled early on. And while not actually canceled, NBC’s Will & Grace revival is officially done (again) after its second series finale aired in April.
Some freshman shows make the cut
Even with uncertainty ahead, some new series from the previous TV season will get to tell more stories when production resumes. CBS legal drama All Rise, which recently closed out its first season with a virtually produced coronavirus-centric episode, will be back, as will the network’s Evil, which comes from The Good Wife and The Good Fight creators Robert and Michelle King. CBS has also ordered new seasons of Bob Hearts Abishola and The Unicorn.
Batwoman and Nancy Drew are both renewed for second seasons at The CW, which announced their fate as part of an early renewals announcement back in January.
Greg Berlanti remains on top
Like last year and years past, Greg Berlanti is staying busy. The prolific executive producer is on track to be at the helm of 10 shows over at The CW (about 21 series overall on TV, even with Arrow wrapped up and CBS’s God Friended Me canceled). New additions to his CW roster include Superman & Lois, ordered to series earlier this year, and a reboot of Kung Fu.
And yes, there should still be new shows on offer
Kung Fu and Superman & Lois aren’t the only new series expected at The CW. Republic of Sarah and Walker (a reimagined Texas Ranger) are also part of the club. Earlier this year, ABC announced a new David E. Kelley police drama, The Big Sky, while CBS had plans for Silence of the Lambs sequel Clarice, a new Chuck Lorre comedy B Positive, and a reboot of The Equalizer.
In addition to the Stabler SVU spinoff, The Kenan Show should also be part of the new season at NBC, alongside Young Rock and Mr. Mayor, which stars Ted Danson and was cocreated by Tina Fey. Fox, meanwhile, has ordered Call Me Kat, starring Mayim Bialik, and another animated series, Housebroken.