fortune--2020-04-27--Whole Foods is restricting cash payments in some stores

Amidst concerns over the ongoing spread of the coronavirus, at least one national grocery chain has begun limiting the use of cash in some stores.
Last Friday, reports began to surface on social media of Whole Foods stores restricting or even eliminating cash payments. One Twitter user posted a sign that appeared at one of the Amazon-owned grocers’ locations:
The grocers’ move comes as health experts cited by CBS warn that the disease can be transmitted on paper money, and as the Federal Reserve has decided to delay the processing of dollars repatriated from Asia.
“Starting on April 20, some Whole Foods Market regions began designating “cash accepted” and “no cash accepted” lanes as an added safety measure and to make the checkout process easier for customers,” according to a Whole Foods spokesperson. The company added: “We accept cash in all of our stores and have made no changes to our cash policies. Some stores have designated certain lanes as credit and debit EBT only, as an added safety precaution and to streamline the checkout process. The image of signage stating ‘no cash accepted’ was taken from a single register lane and is not reflective of any greater store policy. As always, any customer who wishes to pay with cash in our stores can easily do so.”
Reports from customers, however, suggest the changes may be more extensive. Attorney Daniel Nazer told Fortune that cashiers at a Whole Foods on Ocean Avenue in San Francisco told shoppers last week that stores would not accept cash at all beginning on Monday.
In an earlier tweet, Nazer also pointed out that a ban on cash could hurt those without bank accounts.
Wholefoods says they will stop accepting cash next week. Is this gonna be widespread? The unbanked can just starve, I guess. — Daniel Nazer (@danielnazer) April 24, 2020
According to the FDIC, 6.5% of Americans don’t have bank accounts while 18.7% are “underbanked,” meaning they rely on financial services outside the traditional bank systems.
Concern for these consumers as well as seniors and others who often rely on cash has led a growing number of cities—including Philadelphia and San Francisco—to pass laws in the last two years that forbid most merchants from going cashless. Meanwhile, a law in Massachusetts has long required merchants across the state to accept cash.
A spokesperson for the San Francisco Mayor’s Office didn’t immediately return a request for comment about the recent developments at Whole Foods.
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—5 lessons for the coronavirus recovery, from an expert on success and failure in crisis
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—Where investors can find income in a coronavirus-crushed market
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April 27: The first line of this story has been updated to reflect that Whole Foods is limiting the use cash in some stores.
April 28: This story has been updated with a longer statement from Whole Foods.


fortune--2020-04-27--IRS stimulus check portal: Try this trick if you are still getting ‘payment status not available’

How the U.S. should invest in public health before reopening the economy

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Could ALL CAPS be the secret to tracking your stimulus check?
After weeks of complaints about people getting the dreaded “payment status not available” error message on the IRS’s Get My Payment portal, some Twitter users think they may have found the key.
After a couple weeks of getting the "Payment Status not Available" message on the IRS "Get My Payment" site, I just saw a tip to try entering my street address in ALL CAPS and it *worked* — 💀 damned sinker 💀 (@dansinker) April 27, 2020
Yes, some users have found that by entering their street address in all caps, they are able to view the status of their payments. One Fortune editor, who had been unable to access the status of his payment for weeks, tried the trick today. He inputted his address in all caps, and was ushered through to the verification page where he was asked to submit tax information from previous years to verify it was him. Then he was asked to submit his bank account information and was informed that his money would be direct deposited into his account.
Other Twitter users have said they have found success by, for example, entering “Unit 2” rather than “#2” for their apartment. But some still voiced frustration, saying the system would only allow for so many variations before kicking them out for 24 hours.
It is possible, however, that the discovery of the all caps trick just neatly coincided with a systemwide upgrade at the IRS.
The IRS announced Sunday that it had “adjusted several items related to the online tool, which debuted on April 15. The additional changes will help millions of additional taxpayers with new or expanded information and access to adding direct deposit information.” In a press release on the agency’s website, IRS Commissioner Chuck Rettig encouraged everyone who had previously been unable to see the status of their payment to “check back in and visit Get My Payment.”
The agency says that those hoping to track their payment will need three key pieces of information:
Social Security number
Date of birth, and
Mailing address used on their tax return.
The IRS did not immediately respond to Fortune’s query about whether using all caps is recommended, or whether the users were able to get through as a result of the portal upgrades. But, in any case, for anyone desperate for their stimulus check, it’s certainly WORTH A TRY.
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—Why Goldman Sachs thinks Q1 GDP will be “worse than it looks”
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fortune--2020-04-27--How the U.S. should invest in public health before reopening the economy

IRS stimulus check portal : Try this trick if you are still getting ‘ payment status not available ’

There is mounting pressure all across the U.S. for leaders to open businesses and ease the stay-at-home orders that have helped reduce COVID-19 infection rates and prevent a complete collapse of the health care system. Already, states like Georgia are poised to begin opening up gyms, nail salons, and even tattoo parlors.
But doing so at this time is not only dangerous, it’s also potentially a catastrophic decision. The fact is, we are still a long way from being able to safely reopen the U.S. economy. And if we proceed before we’re ready, we will find ourselves in an even worse position—as cases surge and the death toll rises.
Clearly, the suffering we’ve experienced in recent months has been significant. More than 22 million Americans have filed for unemployment, shattering previous records. Over 50 million children are out of school. Frontline workers and families are plagued with mental health issues and overwhelming exhaustion. Patients with ailments unrelated to COVID-19 are avoiding hospitals and doctor’s offices, risking serious health complications and even death. And due to repeated exposure to the coronavirus, countless health care professionals have fallen ill.
What we need right now is to make major investments in public health—not only to overcome the pandemic we face today, but also to prepare for the other public health crises of tomorrow. Never again should the economy be forced to a standstill to contend with the threat of a deadly pathogen.
To that end, here’s what must be done:
First, a national plan for testing, contact tracing, and patient isolation needs to be established. The full extent of COVID-19 infections and deaths in the U.S. is still unknown. And without a better understanding of what is happening on the ground and how it is impacting people, any move to reopen nonessential businesses and lift restrictions on public gatherings risks triggering an enormous second wave of infections and bringing our health care system to its knees once again. In fact, the Centers for Disease Control (CDC) director Robert Redfield has noted that if a second wave of infections later in the year were to coincide with flu season, the scenario could prove far more dire than what we have seen already.
The CDC, in coordination with state and local public health agencies, hospital systems, universities, and the private sector, must urgently develop and scale systems for testing active COVID-19 infections, as well as for serology tests that can detect the presence of antibodies in those who were previously infected. Early studies have indicated that the percentage of the population with antibodies for the novel coronavirus is several times greater than the percentage of the population that has tested positive for an active infection—meaning the disease is likely far more widespread than is currently measured.
This national testing effort must be coupled with significant new investments in federal, state, and local public health departments and agencies. The U.S. needs a single, national technology system for tracking the results of this expanded testing. The existing ILINet system for tracking flu-like disease outbreaks, managed by the CDC with inputs from health care providers across the country, offers a strong model. Local public health departments also need adequate funding and staff to effectively monitor local outbreaks and engage in contact tracing. To safely reopen the economy, the system must be able to effectively identify, notify, and isolate those who have been potentially infected after stay-at-home orders are eased.
New technologies must also play an important role in contact tracing and isolation. For instance, smartphone GPS functions can help alert public health departments if an individual who is supposed to remain at home has broken their isolation protocol. The CDC should be actively involved in any efforts by the private sector to develop smartphone-enabled tools for monitoring COVID-19 cases to ensure that strong regulations are in place to protect personal information and promote data security.
Second, there must be an ongoing, global program of vaccine development. Dozens of vaccine candidates and potential treatments for COVID-19, including using bone marrow cells to prevent deadly immune system overreactions in coronavirus patients, are already entering initial clinical trials—that’s the good news. But the global system for developing, testing, manufacturing, and scaling distribution of vaccines remains fractured and inefficient—meaning it will take months, if not years, to produce, manufacture, and distribute a safe and widely effective vaccine.
Government agencies, university researchers, and pharmaceutical companies around the world must come together under a common framework for sharing data and information on COVID-19, lab results for potential vaccines, manufacturing needs and methods, and outcomes from animal and human vaccine trials. The data-sharing framework should also include science-driven criteria for selecting the best vaccines to produce and distribute at scale. To help, more public, philanthropic, and private investment must be dedicated to accelerate research and development and help fund upgrades in scientists’ research infrastructure. In other words, this is a time for cooperation, not competition.
Finally, cross-sector collaborations are needed in order to prevent the next pandemic before it starts. A major challenge for the U.S. public health system is that we ramp up investments in response to disease-specific fights, and then allow resources to slack off when times are good. That puts us at a critical disadvantage when crises arise. For example, when SARS emerged in 2002 to 2003, vaccine development efforts were ramped up, only to be defunded when SARS disappeared. Had those candidates been developed, we would be much closer to developing vaccines for COVID-19.
The problems with the current system begin at the lab bench. The immune system is an immensely complex apparatus. We know that as people get older, their immune systems struggle to fight off run-of-the-mill infections. We also know that many vaccines don’t work nearly as well for elderly people as they do for younger adults. But we don’t know why because we haven’t invested enough in the research.
This limited knowledge about how to generate effective human immunity is unfortunately coinciding with the present-day crisis, as evidence shows that COVID-19 is more likely to lead to severe symptoms and higher rates of mortality in the elderly—and that even for younger, healthier patients, an immune system overreaction to the coronavirus can cause them to suddenly crash. Without a more robust understanding of the immune system, doctors are flying half-blind when trying to devise treatments.
All of this speaks to the reasons why the Harvard T.H. Chan School of Public Health and the global nonprofit Human Vaccines Project recently launched the Human Immunomics Initiative, a collaboration to improve understanding of the immune system and use that knowledge to accelerate the development of vaccines and treatments. And, over time, by bringing together experts from across fields, we expect the Human Immunomics Initiative to help address many of the most pressing challenges in public health, from the precipitous rise in autoimmune diseases to understanding how inflammation contributes to cardiovascular disease.
In truth, more collaborations like this one are needed—cross-sector programs that bring together laboratory scientists, public health experts, tech engineers, and others—to reexamine the fundamental underpinnings of human health and disease, translate those findings into new treatments, and disseminate those treatments to the public.
So while we aim to avoid a potentially catastrophic decision to reopen, we must learn from this COVID-19 pandemic that investing in and maintaining a strong public health infrastructure will not only protect the economy, but also improve health and save lives everywhere.
Michelle A. Williams is dean of the faculty at Harvard T.H. Chan School of Public Health.
Wayne C. Koff is president and CEO of the Human Vaccines Project.
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fortune--2020-04-27--‘Deeply frustrated’: Tech issues and backlogs hit the SBA’s second round of PPP loans

Round 2 of the Paycheck Protection Program kicked off Monday morning, and the Small Business Administration’s systems are already experiencing problems amid a flood of backlogged applications.
The SBA’s processing site, E-Tran, reportedly experienced problems shortly after it opened back up at around 10:30 a.m. ET on Monday, although it’s unclear if the issues were widespread. Round 1 of the SBA’s program ran out of money in just 13 days when funds dried up on April 16. During Round 1 of the PPP, the E-Tran system reportedly had intermittent problems as well, going down for periods of time, banks recalled, while SBA denied the system had an outage. However, the Small Business Administration told Fortune in a comment that the “SBA notified lenders yesterday that pacing of applications into the E-Tran system would occur, meaning all lenders would be able to submit at the same rate per hour. The pacing mechanism prevents any one lender from submitting thousands of loans an hour into the E-Tran system. If a lender goes above the pacing limit they will get timed out.”
Replenished with a new $310 billion, many banks are saying the new funds will initially go directly to a hoard of backlogged applications from the first round that were unable to get funded or processed in time—leaving some to wonder if funds for this tranche will be depleted in a matter of days.
For one, Seattle-based Washington Federal bank has a backlog of nearly 1,500 applications in their system’s queue, which they will be processing “in waves,” plus an additional 2,000 applications in the bank’s waitlist. “Whether that’s 500 people or 1,000 every 10 hours, we’ll see how it goes,” Washington Federal’s CEO Brent Beardall recently told Fortune. Minnesota-based regional bank Sunrise Banks also recently told Fortune it had around 3,000 applications in its queue for round 2.
Others like fintech Square, which began approving applications in round one after obtaining SBA approval for the program, told Fortune on Monday morning that it was getting some loans through once E-Tran opened back up. Jackie Reses, head of Square Capital, told Fortune that over the weekend, the SBA set up a means to pace banks so the system wasn’t flooded at the onset (“I’m so anxious [but] our loans are getting through, so I feel so much better,” she says).
Still, lenders report that the E-Tran system was experiencing issues out of the gate amid a deluge of applications.
“We have had trouble with E-Tran this morning,” Sunrise Banks’ CEO David Reiling told Fortune in a note on Monday morning. “It has been a disappointing start to round two of the PPP authorization process. We hope the SBA can fix it soon. We currently have approximately 600 applications ready for E-Tran now and that number is targeted to be over a 1,000 shortly.”
Rob Nichols, the president and CEO of bank trade group American Bankers Association, said in a tweet Monday that banks were “deeply frustrated” with the E-Tran system on Monday morning.
Our member banks across the country are deeply frustrated at their inability to access @SBAGov's E-Tran system. We have raised these issues at the highest levels. Until they are resolved, #AmericasBanks will not be able help more struggling small businesses. — Rob Nichols (@BankersPrez) April 27, 2020
Washington Federal’s Beardall told Fortune in a note Monday that amid a “tsunami” of applications, the SBA’s infrastructure “appears to be over-whelmed.” But he doesn’t blame the SBA, who he credits with “working very hard.” Others like Frank Sorrentino, the chairman and CEO of New York and New Jersey-based regional bank ConnectOne Bank, note his bank hasn’t experienced any big outages or issues, but “it has been a slow process. It’s my view that it’s just slow for the individual institutions, but not for the entire SBA process as a whole,” he tells Fortune.
Of note, the Small Business Administration said Monday that over $2 billion in PPP loans that went to companies during the first round of funding was either declined or returned, and will be put back into the pot for round two.
Sen. Marco Rubio said in a video on his Twitter Monday that so far, the average loan size is about 50% less than in round one, based on applications from Monday morning.
Despite long queues at many banks, big and small, some lenders still suggest applying for the PPP, even if it’s for the first time during round 2. “If [you are] a small business, you get in line—pick your bank and get in line and start working through it,” Beardall suggested.
Many lenders anticipate a round 3 will be necessary to deal with the demand for the program. Republic Bank’s chairman Vernon Hill recently remarked to Fortune, “Are they all going to get funded? I don’t know.”
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Update, April 27: This article has been updated with additional comments from bank CEOs about the E-Tran system.
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fortune--2020-04-27--Michelle Obama documentary ‘Becoming’ will premiere on Netflix next week

A documentary portrait of Michelle Obama titled “Becoming” will premiere on Netflix next week, the streaming company announced Monday.
The film, described as “an intimate look into the life of former First Lady Michelle Obama” chronicles her 34-city book tour in 2018-2019 for her best-selling memoir “Becoming.” Obama’s promotional tour, managed by the concert promoter Live Nation, had the scale of a rock tour, with a string of dates at sold-out arenas.
The film will debut May 6 on Netflix. In a statement, Obama said the experience of the tour “drove home the idea that what we share in common is deep and real and can’t be messed with.”
“We processed the past and imagined a better future. In talking about the idea of ‘becoming,’ many of us dared to say our hopes out loud,” said Obama. “I treasure the memories and that sense of connection now more than ever, as we struggle together to weather this pandemic, as we care for our loved ones, tend to our communities, and try to keep up with work and school while coping with huge amounts of loss, confusion, and uncertainty.”
“Becoming” has sold more than 11 million copies and been translated into more than 20 languages. The former First Lady’s popularity has made her a potentially pivotal figure in the 2020 presidential campaign. Joe Biden, the presumptive Democratic nominee, recently said that he’d pick her as a running mate “in a heartbeat,” before adding that he didn’t think she “has any desire to live in the White House again.”
Nadia Hallgren, a veteran documentary cinematographer making her feature directorial debut in “Becoming,” trailed Obama on the book tour from city to city. “She moves quickly and I had to learn to move with her,” said Hallgren.
“Becoming” is the latest release from Higher Ground Productions, the production company created by Barack and Michelle Obama. Their exclusive multi-film deal with Netflix has already proven fruitful. Their first film, “American Factory,” by Julia Reichert and Steven Bognar, earlier this year won the Academy Award for best documentary. (The Obamas did not attend the Oscars, nor received a statuette.) Higher Ground was also behind the acclaimed recently released documentary “Crip Camp: A Disability Revolution,” by James Lebrecht and Nicole Newnham.
The former First Lady acknowledged the timing is difficult for a film about community, and that social distancing doesn’t come naturally to her: “I’m a hugger,” she said. During the pandemic, Obama has read children’s books to kids stuck at home in an online series titled “Mondays with Michelle Obama.” “I’m here for you,” she said in her statement. “And I know you are here for one another.”
“Empathy is our lifeline here. It’s what will get us to the other side,” said Obama. “Let’s use it to redirect our attention toward what matters most, reconsider our priorities, and find ways to better remake the world in the image of our hopes.”
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fortune--2020-04-27--Why Goldman Sachs thinks Q1 GDP will be ‘worse than it looks’

When first quarter GDP is released on Wednesday morning, the consensus is: It will be bad.
But economists at Goldman Sachs think it will be even worse than it looks. As Goldman Senior Economist Spencer Hill wrote in a note released Monday, “Even though the coronavirus sudden stop occurred in the final weeks of the quarter, Q1 GDP is nonetheless set to be the weakest in a decade, confirming an economy already in deep recession.” Goldman is forecasting the official numbers as follows when they are released: a 4.8% annualized decline with a 3.5% drop in consumption (consensus estimates are -3.8% for GDP and -3.5% for consumption).
But, Hill continued, “while we expect the reported decline to be large, we believe economic reality during the quarter was even worse, with a first-print bias of 3-4pp concealing a ‘true’ GDP decline closer to -8¼% (and a consumption decline of -7%).”
In the report he points to three reasons. First, all advance GDP readings “reflect assumptions for not-yet-available source data, and this can attenuate growth readings during major economic inflections.” In other words, they suspect there is more bad news lurking out there that hasn’t fully been reflected in economic readings. Interestingly, the Goldman note points out that the GDP decline during the Lehman collapse ended up being twice as large as initially reported (-8.4% vs. -3.8% in Q4 of 2008).
Second, in certain industries including airlines, ride-sharing, spectator sports and live entertainment, Goldman warns that the “advance reading relies on partial source data or judgmental trends.” Finally, the “better-than-feared March retail sales and durable goods reports” may be due to the fact that business closures “limited access to accurate information.”
All told, Goldman’s Hill advises a rosier than expected number be met with skepticism. Because, as he puts it, they expect this first reading to capture, “less than two thirds of the actual activity decline.”
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fortune--2020-04-27--‘Star Wars: The Rise of Skywalker’ is coming to Disney+ two months early

Star Wars: The Rise of Skywalker, the third installment of the latest Star Wars trilogy and the last of the “Skywalker saga,” is coming to Disney+ ahead of schedule.
The J.J. Abrams–directed finale, also known as “Episode IX,” will be available on Disney+ on May 4, two months ahead of the originally intended release date. Disney says the moved-up premiere is to commemorate the annual Star Wars Day holiday celebrated by fans, though the timing comes as the coronavirus pandemic continues to wreak havoc on Disney’s theme park and theatrical businesses.
Movie theaters around the world largely remain shuttered as social distancing measures keep audiences at home, preventing Disney from releasing tentpole films like its live-action Mulan remake and Marvel’s Black Widow. The films’ theatrical releases in the U.S. have been pushed back to July 24 and Nov. 6, respectively.
Meanwhile, Disney theme parks worldwide remained closed indefinitely, with the exception of China’s Shanghai Disneyland Resort, which has partially started to reopen. Some analysts predict the parks will remain shuttered for the rest of 2020.
Disney+ has been one of the few positives for the company, as consumers spend more time quarantining indoors and using streaming services. The platform earlier in April reached 50 million global subscribers just five months after launch.
The coronavirus pandemic prompted Disney to shift several other releases to its streaming service ahead of schedule: Frozen 2 came to Disney+ three months ahead of schedule, on March 15. Elsewhere, the sci-fi fantasy adventure Artemis Fowl, originally intended for a theatrical release, will premiere directly on Disney+ on June 12.
Our mission to help you navigate the new normal is fueled by subscribers. To enjoy unlimited access to our journalism, subscribe today.
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fortune--2020-04-27--The Coronavirus Economy: How a high school band director does his job from home

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The town of Granbury, Texas—with a population of just over 10,000—lies about a 30-minute drive southwest of Fort Worth. Mark Eastin is director of bands and instrumental music coordinator for the Granbury Independent School District (ISD). In addition to overseeing the Granbury High School wind ensemble in the spring and the marching band in the fall, he supervises two middle school feeder programs.
Granbury ISD, like all Texas school districts, has suspended on-campus classes and activities until the end of the spring semester in response to the coronavirus pandemic. As challenging as it is to hold classes on math or science remotely, Eastin says many elements of music education, such as ensemble practice, have become genuinely impossible.
But the intangibles seem to be at least as much of a loss to the music education veteran. The shutdown has meant losing a rich community of students and teachers. It has also meant canceling the annual competitions and festivities that form the culmination of students’ high school music careers. And the possibility of a Texas fall without football and marching bands is hard to even imagine.
Fortune spoke with Eastin for a new series, The Coronavirus Economy, to ask about how COVID-19 has affected his work and his outlook on the future, and to get a sense of how he has been handling this news, both emotionally and financially. The following Q&A has been condensed and lightly edited for clarity.
Mark Eastin is director of bands and instrumental music coordinator for the Granbury Independent School District. Mark Eastin
Fortune: How have you adjusted band instruction to accommodate for the campus closure and remote learning?
Eastin: Since we’re isolated, the ability to perform in an ensemble is completely gone. These mass ensemble videos you see on Facebook, they record themselves individually, then those individual videos are assembled. Because of streaming speeds, it’s just not feasible to do that live.
So everything becomes very individualistic. We’ve taken all of the material we were working on prior to dismissal, and we’re doing individual playing tests on that. Each week we assign a section of the literature we were working on for the [year-end] University Interscholastic League (UIL) competition, and we work on that individually.
I’m also incorporating some listening assignments for my students. I give them a couple of pieces each week, and give them some comparing and contrasting questions. So they’re listening not just as an audience member, but as they would as a performer in that ensemble.
Those competitions are canceled, I take it?
Some regions did go to UIL before spring break. But the vast majority are in April. So that eliminates qualification for awards for this year. Texas also has an honor band, one honor band for each high school classification, and qualifying for that also culminates at the end of the year. This year 6A, 4A, and 2A students are missing their shot.
Texas is known for having probably the best high school band programs in the country, and these competitions are a bit of a confirmation of the work that’s put in to achieve excellence. It’s a badge of honor for our students.
Seniors are also missing out on year-end band banquets, awards banquets, and performances. Every year we take them to a big venue, like the Meyerson Symphony Center in Dallas, just to give our kids an experience in a professional hall. There are just some really wonderful experiences that we get to offer our kids in the late spring that are now nonexistent.
Are those awards linked to college admissions or scholarships for your students?
A lot of people don’t know, but there’s probably more money for music scholarships than anything else at some colleges. As far as the disruption, it could be worse. The group honors, that’s more in line with, say, a football team winning a state championship. Just because you’re on a championship team doesn’t mean you’re a Division I athlete.
But the auditions for individual scholarships, a lot of that has been thrown up in the air. Some scholarship auditions were planned for after spring break. I’m working to try and coordinate those auditions, but there’s a lot of indecision. There’s not a playbook for this.
How are students taking the disruption?
There’s been a lot of tears, I can tell you that. It’s been one of those times. We in the band world develop such a relationship and such a closeness, it becomes a family. It’s missing out on being with your family.
Normally, we have three concert bands that will meet every day. We have sectionals that meet every day. Kids are at the band hall starting at 7:30 in the morning. I don’t leave the band hall until 5 p.m. or 6 p.m. every night, and there are always kids there practicing. It’s very hard for those kids not to have that time, being with their friends.
And GISD believes that one of the best deterrents of truancy, and ways to get kids to succeed, is through extracurriculars. So you’re missing those daily activities that become part of your motivation to go to school.
How bad is the coronavirus situation where you are?
We’re in an outlying county. They have seen a bit of an uptick in Tarrant County, which is our neighboring county. In Hood County, we have had 19 cases total and three deaths. All had pre-existing conditions. We had some that had been on international travel, others were commuting to Fort Worth.
So there hasn’t been a huge spike. That doesn’t mean that there’s not some nervousness about it. Our nonessential businesses are shut down, and we’re very much dependent on tourist dollars. We’re still very cautious, which I think has helped keep the spike down.
Are students resentful about the restrictions, or pushing back against them?
There’s probably some of that. With high schoolers, they do have opinions, they do read. They’re savvy enough that if they’re driving to the store and see all this activity going on, they might question the validity of why we’re having to shut everything down. The more they miss, I think those questions are probably a little bit more to the forefront.
I know that with my own daughter, she’s taking it pretty seriously, and for the vast majority of the students I’m aware of, we’ve seen the same thing. I don’t think there’s been a huge [number] of students who say, “Oh, this is nothing, and we’re going to go on about our lives.”
But being in a small town, the school is very much the center of our community, and the center of the activity our school-age kids are involved in. That’s the biggest challenge for most of them—just the dead stop.
School in Texas is now remote through the end of the semester. How are you planning for the fall—and for the football season?
Texas and football are one and the same. High school football is a driving force of most communities in the state of Texas. As it pertains to the school year itself, if school starts on time, I think football and everything will start on time. It’ll pretty much be determined by when they say school can be back in full force. And if there’s still some residual concern, I can’t see there being football without a crowd, but that may be something they look at.
But we are dealing with such an unknown. We don’t know how long this is going to affect us. So we feel like the only course of action that is going to be beneficial to us is to assume we’ll start in July as we normally do, and football is going to be on track as it normally is.
We’re in the design process of a marching show. We have a meeting with our design team every two weeks, all of our directors and arrangers. We’re still doing drum major auditions, leadership auditions, auditions with our incoming eighth graders who are going to be ninth graders, to get them seated for next year. We’re going full-bore ahead as if we were in school, as best we can, and planning for next year as if when we hit July, we’re back on a normal calendar.
How has this made you think differently about your role as a teacher?
I think this just has given credence to the fact that we as teachers are fully invested in our students. I know that this has been a challenge for a lot of people. I can tell you that as teachers, we get up every morning to be with our kids. And we have basically lost the reason that we do what we do. We still get to teach, but it’s through a computer screen.
As a band director I can tell you, I’ve had days I just had to get in my car and soak it in for a minute. We’ve all felt the sting of waking up in the morning and dealing with the silence. There’s not that cacophony of kids coming into the school. There’s not that interaction with the kids that love us, and we love them.
We spend as much or more time with our band kids as we spend with our own kids. They are our family. They’re our reason for being, in many cases. And we’re the reason they have a place of safety, a place to call home. They no longer have that.
It has left a hole in our soul. I have broken down on several occasions, and I’m not afraid to admit it. The music we create is something that is indelible, and it is gone.
I’m very close to retirement. And if this is what retirement’s like, I’m going to work up to lunch on my funeral.
More coronavirus coverage from Fortune:
—The trillion-dollar question: How far will GDP fall?
—After stocks, the housing market could be the next to plunge
—Google, Andrew Yang, and Ariana Grande back a new effort to send an extra $1,000 to 100,000 U.S. families in need
—How live-event companies pivoted to building temporary hospitals and testing sites
—5 veteran investors on how to approach the coronavirus stock market
—How Hong Kong squashed its second coronavirus wave
—The comfort economy gains momentum during the coronavirus pandemic
—PODCAST: COVID-19 might have upended the concept of the best companies of the year
—VIDEO: 401(k) withdrawal penalties waived for anyone hurt by COVID-19
Subscribe to Outbreak, a daily roundup of stories on the coronavirus pandemic and its impact on global business, delivered free to your inbox.


fortune--2020-04-27--What the law says about forcing employees back to the office

On Friday, the State of Georgia declared a variety of businesses, including hair salons and gyms, could open their doors again even as the coronavirus pandemic continues to rage. This week, other states will follow suit.
This situation poses a hard dilemma for millions of Americans asked to return to work—as well as those in essential industries who have had to work all along—about how to balance risks to their health and their livelihood.
According to legal experts, employees don’t have a blanket right to refuse to work during the pandemic, but that doesn’t mean they can’t demand protection from obvious risks. Meanwhile, lawyers are advising business owners to think carefully about worker safety as they navigate a situation fraught with legal implications.
Workers’ rights during a pandemic
As engineer Nick Wheeler watched his coworkers fall ill to the coronavirus, he couldn’t understand why his employer, Charter Communications, refused to let them work from home. Finally, on March 13, Wheeler sent what he calls a “grenade” in the form of an email blast to hundreds of managers and employees in the company’s Denver office, calling the policy “pointlessly reckless.”
Within 10 minutes, a Charter VP summoned Wheeler into a meeting where a human resources manager accused him of “spreading fear.” He was flabbergasted.
“HR accusing me of spreading fear was the most ridiculous thing I heard in that meeting. The whole staff was talking about coronavirus already, and it was in the news every day with the governor planning to shut down the state,” he says. He added that the Charter policy felt even more absurd given that everyone in his office had laptops and access to a VPN (virtual private network) that would enable them to work from home.
The company changed its policy but not before Wheeler says he felt forced to resign. Now, the engineer says he is speaking with a lawyer about a wrongful termination suit, while the attorney general of New York pursues an investigation into Charter’s actions.
A spokesperson for Charter told Fortune: “We have dramatically reduced the number of employees going into the field or into the office while maintaining the efficacy of our business operations that is so critical to fighting this pandemic.”
Wheeler’s decision to send an email blast was a bold one, and one he claims led more than a hundred colleagues to send him messages of support. But while many other employees in the U.S. may confront a similar situation, they may be reluctant to take a similar measure out of fear of reprisal.
They can, however, turn to the federal Occupational Safety and Health Administration (OSHA), which protects employees from dangerous workplaces.
According to attorney Jonathan Segal of the firm Duane Morris, the federal OSHA rules take priority over state laws. That means they could protect workers in places such as Georgia, where the decision to open venues like bowling alleys has led to criticism from health experts.
But Segal and other employment law experts also say a general fear of catching the coronavirus isn’t enough justification to refuse to work.
“You’d have to be in imminent danger. An individual has a narrow right to refuse to go work on the basis of what a reasonable person would fear,” says Jason Bent, a law professor at Stetson University.
In such cases, he says, workers can call for an OSHA inspector to decide if a workplace is unsafe, and the law protects them from retaliation if they do so. Bent adds that if a group of employees protest working conditions, federal labor law likewise forbids retaliation.
But while federal law may be a tool for some workers, it may not always be a practical one. An interior designer, who spoke on the condition her name not be used, says the manager of the Dallas company where she works insisted staff come to the office even after the state issued stay-at-home orders.
“My coworkers discussed filing a complaint with OSHA but concluded it’s pointless. There’s lots of hoops to jump through, and the law is tilted in employers’ favor,” she says, adding that the boss finally allowed her to work from home after one of her colleagues became sick with COVID-19.
Aside from workers’ skepticism about the effectiveness of the OSHA rules, it also remains to be seen how “danger” will be interpreted in the case of the pandemic. The consensus among labor experts appears to be that an employer who takes careful measures to protect workers—such as by providing masks, shields, and sanitizers and enforcing social distancing—could likely avoid liability if an employee becomes sick.
Chicago attorney Monica Khetarpal, who advises businesses at the firm Jackson Lewis, is telling her clients to evaluate worker concerns on a case-by-case basis. This should include, she says, examining whether employees have pre-existing conditions that put them at a higher risk for COVID-19. Likewise, she advises companies to be mindful of the new Families First Coronavirus Response Act, which provides special protection to those with children. The law, which is in effect until the end of this year, requires many companies to provide paid leave to those who lack childcare as a result of the pandemic. It also requires them to provide paid sick leave to those subject to government quarantine orders or who are experiencing coronavirus symptoms.
Meanwhile, some employees who have contracted coronavirus at work are filing workers’ compensation claims—but the outcome has varied based on the state. In Oklahoma, the state agency denied compensation to an EMT while, in California, authorities are changing rules to make it easier to claim compensation.
There has also been at least one wrongful death lawsuit filed as a result of a worker who died from COVID-19. It involves a Walmart employee, but Bent, the law professor, says the case is a long shot at best, since such claims require the plaintiff to show the death was intentional. In response to the lawsuit, Walmart issued a statement expressing condolences and describing additional sanitation measures the company has put in place.
A possible legal shield for employers
As the debate over health risks to workers grows louder, business groups are lobbying Congress to pass a law that would shield companies from coronavirus-related lawsuits. The idea is backed by Rep. Mike Johnson (R-La.), a member of President Trump’s economic task force who predicted it would receive “near-unanimous support” from Republicans. The Wall Street Journal’s editorial board has argued such a law is needed to protect businesses—many of which are already struggling—from opportunistic class action lawyers. But labor advocates cited by the Financial Times say such concerns are overblown, and Democrats like Sen. Tammy Baldwin (D-Wis.) are proposing legislation that would force employers to do more to protect workers.
In the short term, as the political battle plays out, there are likely to be more individual whistleblowers like Wheeler, who says his only regret is that he didn’t stand his ground more.
And even as individual disputes get resolved, Khetarpal and other attorneys predict a surge in litigation over COVID-19 in the workplace during the next few months.
Much of this litigation is expected to focus on health threats to workers. But the pandemic will also give rise to disputes over related issues such as workplace privacy, according to Finn Makela, a law professor at Sherbrooke University.
Makela notes that employers are already exploring ways to monitor the health of workers, including by taking their temperature prior to a shift. He says that doing so would not be particularly invasive, but that other proposals could cross a line, including potential plans by some companies to require workers to install an app that would help their employers use contact tracing to track their locations.
Makela warns that employees who refuse could see their hours cut or simply be let go.
“The private sector has the power to impose behaviors on aspects of our social lives. Meanwhile the private sector moves more quickly than the government, and people are slower to respond to any intrusive conditions they might impose,” says Makela.
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More must-read stories from Fortune:
—Why the IRS stimulus check portal may be saying “payment status not available”
—Bill Gates explains how to beat the coronavirus pandemic
—Which companies’ stocks will thrive after the coronavirus crash?
—Everything you need to know about furloughs and what they mean for workers
—Filing for unemployment benefits? What to know before you start your claim
—PODCAST: COVID-19 might have upended the concept of the best companies of the year
—WATCH: The U.S. Postal Service is in deep financial trouble. Here’s why
Subscribe to Outbreak, a daily roundup of stories on the coronavirus pandemic and its impact on global business, delivered free to your inbox.


fortune--2020-04-27--Where investors can find income in a coronavirus-crushed market

The strategy of diversifying your portfolio—spreading your investments across stocks, bonds, and other assets—has always been a main principle of safe, long-term investing. And income-yielding investments, including bonds and high-dividend stocks, have played a particularly big role in that strategy, because the income they generate can help inject a bit of growth into your portfolio, even when asset prices are sinking.
But the market crises prompted by the coronavirus pandemic are putting this basic tenet of investing to the test. The sheer velocity of the market’s decline—the S&P 500 fell 31% in a month’s time from late February through late March—could scarcely be mitigated by dividends. And as demand for bonds rose, U.S. Treasury yields reached all-time lows, while the Federal Reserve reduced interest rates to zero, making bonds less likely to provide much income benefit to new buyers.
While the market has stabilized in recent weeks, much remains uncertain about the long-term economic fallout—and initial forecasts aren’t exactly upbeat.
The upshot of all this is that for those seeking income from their investments, the options have become more limited. On the plus side, many of your income choices have now gone on sale, if you have an appetite for risk.
Hunting for the right dividends
Falling interest rates often go hand in hand with economic uncertainty, and that has certainly been true since the beginning of this year. And falling rates are usually good news for companies that pay hefty dividends.
In a recent study, research firm Morningstar found that large-cap stocks with stable cash flows often lag during stock-market booms. But they usually get a boost when interest rates fall, according to the report. Large firms take pride in the longevity and growth of their payouts, and they’re not likely to cut their dividend unless they’re up against a wall.
Still, in a crisis like this, not all dividend stocks are created equal. The math of an individual company’s dividend can look deceptively large when share prices plummet, since a falling share price means a higher yield (you calculate yield by dividing the dividend per share by the stock price per share). And when companies get badly pinched, they sometimes cut or suspend their dividends. (So far in 2020, more than 30 companies in the S&P 500 have either reduced or suspended their dividend payout; General Motors announced a dividend-suspension Monday morning.)
So which dividend-paying stocks appear to be stable right now? Utilities look relatively secure, and so do consumer non-durable goods—think consumer-products giants like Procter & Gamble and food and beverage makers like Kraft Heinz, Kellogg, and Molson Coors. Morningstar’s research suggests that those sectors also outperform in a falling-interest-rate environment.
If you’re moving towards safer dividend payers, make sure not to overlook the stock returns, warns Adam Grealish, director of investing for robo-advisor Betterment. Dividends have accounted for only a bit more than 20% of total returns in the market since 2011, according to research from Thornburg Investment Management. If a company’s stock price was going nowhere before the recent crash, in other words, its dividend alone may not make it worth scooping up.
Still, for dividend-hunters, there’s one upside to the recent volatility. “Prices are depressed,” says Steven Frazier, president of Frazier Investment Management. It gives you an opportunity to grab highly rated companies that were “really expensive last year,” he adds.
Frazier’s point is illustrated by the ProShares S&P 500 Dividend Aristocrats ETF (ticker: NOBL), which is down about 18% for the year to date, compared to about 13% for the S&P 500. That underperforance may reflect short-term panic rather than long-term prospects of the stocks in the ETF: NOBL tracks companies that have grown dividends every year for the past 25 years, even during downturns.
The corporate-bond balancing act
With ultrasafe Treasuries yielding ever less income, revenue seeking investors are eyeing riskier investments.
But with so many businesses’ futures in jeopardy, it’s no time to escape into the riskiest of bond groups—high-yielding “junk” bonds. Instead, Frazier is eyeing the investment-grade corporate bond space as the only risk worth taking. These bonds aren’t as safe as they’d normally be, since the coronavirus is impacting the ability of some companies to pay their debt. Still, as long as the U.S. economy survives this scare, even in diminished form, most companies in the space will continue to repay their loans.
The ICE BofAML US Corporate Master Index, which tracks investment grade corporate debt, currently sports a 3% effective yield. Various low-cost ETFs track investment-grade corporate bonds; you can find some examples here.
Safe as houses
Investors pessimistic about more liquid investments may want to consider investing in a more traditional income-generator: rental property. Real estate is a “nice diversifier” that’s relatively free of the current market issues, notes Frazier. And 30-year fixed mortgage rates, which averaged well over 4% last summer, averaged just 3.33% last week, according to Freddie Mac, close to an all-time low.
To be sure, a coronavirus lockdown is no time to shop for a property—and an economic downturn is a risky time to buy one. But if stock and bond markets remain choppy, the security of incoming rent checks may look very attractive by comparison.
More must-read finance coverage from Fortune:
—Real unemployment rate soars past 20%—and the U.S. has now lost 26.5 million jobs
—Why charging members of Congress with insider trading is so fraught
—Out of work, but not unemployed: How much Europe is paying its idled workers
—This time, the banks were ready: How the Big Four prepared to survive the coronavirus
—Furlough vs. layoff? What to know about your rights and benefits
—Listen to Leadership Next, a Fortune podcast examining the evolving role of CEO
—VIDEO: 401(k) withdrawal penalties waived for anyone hurt by COVID-19
Subscribe to Fortune’s Bull Sheet for no-nonsense finance news and analysis daily.


fortune--2020-04-27--Square to suffer a ‘steep drop’ as many customers struggle to survive, analysts say

Payment company Square is expected to take a big financial hit because of the coronavirus pandemic.
The company will collect far less from its largest group of customers, small and medium-size businesses, which pay fees based on their sales. Some of those are restaurants, bars, and shops that are either closed or in crisis, and therefore handling fewer transactions.
As a result, Square could see as much as a 61% drop in first-quarter revenue, according to Mark Palmer, an analyst with investment bank BTIG. Although the company should be able to survive the pandemic, it will be painful, he says.
“It can withstand a downturn,” Palmer says. “With that said, we are anticipating that the company is going to see a very steep drop.”
Square, led by CEO Jack Dorsey, is among the many tech companies that are largely dependent on small and medium-size businesses—the most vulnerable segment in the wake of the pandemic. For example, Yelp, which sells advertising and other services to restaurants and local service providers like electricians and plumbers, has similarly suffered, prompting it earlier this month to lay off 1,000 workers and furlough another 1,100.
Dorsey, who is also CEO of Twitter, hasn’t said whether Square will follow suit in cutting its workforce. During a recent investor call, the company said it plans to slow hiring, reduce travel, and pause on adding new real estate.
The company declined to comment for this article.
But Brett Huff, an analyst at investment bank Stephens, expects that some cost cutting is coming. “We do expect them to tighten their belt,” he says, suggesting the company could cut contractors, sales commissions, or possibly even lay off workers.
What is clear is that the losses for small and medium-size businesses are mounting. And while they’re starting to reopen in a few states, any nationwide recovery will take some time.
Square makes money by collecting fees on every sale by merchants and through subscriptions for additional software for managing functions like inventory and payroll. It also offers small-business loans through Square Capital as well as Cash App, an app that gives consumers the ability to transfer money to each other.
In February, Square said that it would collect $1.34 billion to $1.35 billion in first-quarter revenue. However, soon after, the company cut its guidance because of the epidemic to between $1.30 billion and $1.34 billion. The company’s latest outlook still represents a 36% to 40% increase in revenue, a far rosier picture than some analyst projections.
Furthermore, Square had originally predicted that it would collect $5.9 billion to $5.96 billion in revenue during full-year 2020. But it later withdrew that forecast and promised to provide more details about it when it reports first-quarter earnings on May 6.
Square’s shares are down nearly 30% from their peak in February, when the stock traded at $85.70.
A slowdown in Square’s business could let competitors gain ground, BTIG’s Palmer says. For example, mobile payments company Clover may be able to use the deeper pockets of its parent company, financial technology provider Fiserv, to push ahead during the crisis.
In 2019, Clover processed more than $100 billion in payments, growing at a clip of 40% year over year, according to Fiserv’s leadership. BTIG’s Palmer says that slightly trails Square, which last year increased its total number of transactions by about 25% to $106.2 billion.
Square may be able to counter that threat by creating additional features in its products. It introduced one that lets customers who order restaurant food online chose to pick up their meals at the curb and another that lets them get their food delivered to their doorstep without any physical contact with the delivery person.
Square is also helping its struggling business customers survive by giving them discounts. In April, it waived the fees for its products that help those customers track invoices, pay employees, and send email marketing pitches. It also refunded subscription fees it collected from them in March and delayed payments for customers that borrowed money through Square Capital.
Square also hopes to help customers by distributing small-business loans through the federal government’s emergency Paycheck Protection Program. But it’s unclear whether Square actually granted any loans before the program ran out of its first round of money.
“They want to do everything they can to keep these customers afloat,” says Jason Kupferberg, Bank of America analyst. “The problem for Square would not only be that they have a merchant whose sales are down, but what if that merchant goes out of business? That’s the worst possible outcome.”
But ultimately Square should emerge from the pandemic, albeit bloodied, three analysts agreed. Palmer pointed to Square’s cash reserves. At the end of 2019, the company had $1.05 billion in cash and cash equivalents, giving the company a relatively large safety net. Additionally, last month, the company announced plans to borrow up to $1 billion.
“Their balance sheet is actually in very good shape,” Kupferberg says. “They could comfortably endure two years of a major downturn.”
More must-read tech coverage from Fortune:
—How the coronavirus stimulus package would change gig worker benefits
—Zoom meetings keep getting hacked. How to prevent “Zoom bombing”
—Why China’s tech-based fight against the coronavirus may be unpalatable in the U.S.
—Hospitals are running low on the most critical supply of all: oxygen
—Listen to Leadership Next, a Fortune podcast examining the evolving role of CEO
—WATCH: Best earbuds in 2020: Apple AirPods Pro Vs. Sony WF-1000XM3
Catch up with Data Sheet, Fortune’s daily digest on the business of tech.


IPO 2.0?

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Maybe this time: The so-called blank check company wasn’t much of a hit with the venture capital community two years ago, when cash was still gushing from the private market spigot.
But things have changed. Large startups need cash. SoftBank isn’t pushing up valuations quite like it used to. An uncertain economy has virtually halted the IPO market. In this strange and fast-changing environment, is it time for the blank check company—a fund intended to acquire an unknown company at a later date and take it public via merger, and ultimately a bet on the holding company’s investing acumen—to shine?
Social Capital Hedosophia II, the second such company co-founded by outspoken investor Chamath Palihapitiya (and third of his to go public), is expected to price today and list on Tuesday, assuming markets stay level. Hedosophia II previously filed to raise $345 million.
Palihapitiya’s first blank check company, founded in 2017, was billed as a novel way for companies to go public. It was different than a rigid conventional IPO process that featured barriers—such as when existing investors could cash out after an offering—startups liked to gripe about. But the blank check company didn’t get the same word-of-mouth impact in the venture capital community as did direct listings, which reduce banking fees, offer an exit to existing shareholders, but raise no additional capital for the company itself. Eventually Palihapitiya’s firm acquired a headline-grabbing (but not-exactly startup) target: Virgin Galactic.
Fast forward to mid 2020 and a pandemic with an unknown end date is ravaging the globe (and the global economy). Suddenly a potential $345 million cash infusion sounds mighty attractive. Sources tell Fortune that venture capitalists are once again reaching out to ask about the blank check companies, which helped sister company Hedosophia III gain a $720 million warchest as it seeks an acquisition abroad. (Hedosophia II is expected to seek a company within the U.S.)
An acquisition isn’t guaranteed to happen. First, the Hedosophias will have to find a company in a relatively small universe that will take hundreds of millions. (Remember: the cash won’t swallow the company, but be used in exchange for a stake in it.) It will have to convince shareholders or new buyers that the deal is a good idea. It will also have to convince unicorns that being under the public eye in return for cash is a good deal. (Indeed in 2017, many unicorns were also reaching out about the process.) Perhaps the biggest risk of all is time: Blank check companies usually have up to two years to secure an acquisition target. Who knows what the world will look like in one, two, or 18 months?
Whatever the case, in this environment, unicorns are hungry for cash.
A cancelled flight: Aerospace company Boeing has abandoned plans to acquire an 80% stake in Brazil-based Embraer’s commercial jet unit for $4.2 billion.
Boeing and Embraer have been in talks for a deal since 2017—but three years later, a maelstrom has exploded onto the scene. The coronavirus has decimated the airline travel and paused manufacturing in the aerospace and defense industry, adding to Boeing’s woes following scandals around two 737 Max crashes that killed 346 people. Now, amid a financial downturn, Boeing may be seeking federal aid—which could make a multi-billion dollar acquisition look extraneous even extravagant at a time when the public is throwing stones at airlines for seeking bailouts after years of buybacks.
In a he-said-she-said that is becoming increasingly the norm in these uncertain times: Boeing says that Embraer failed to meet conditions of the deal by the April 25 deadline. Embraer meanwhile is hitting back, saying the deal was wrongfully terminated due to Boeing’s own reputational and financial issues, adding they plan to “pursue all remedies.”
In short: Don’t be surprised to find more M&A breakdowns in hard hit sectors, including energy, travel, and retail.
The Bill and Melinda Gates Foundation: As the world focuses on Covid-19, other innovations will stall. The world’s wealthiest charity with over $40 billion under management is directing its firepower toward the global pandemic, the Microsoft founder told the Financial Times. An ultimately noble and necessary effort—but it also means progress in HIV and polio-related efforts, areas of its focus, will take a backseat.
VENTURE DEALS
- Compass Pathways, a London, U..K-based mental health care company focused on psilocybin, raised $80 million in Series B funding. Investors include ATAI Life Sciences, the McQuade Center for Strategic Research and Development, Founders Fund, Able Partners, Camden Partners Nexus, Perceptive Advisors, Skyviews Life Science, and Soleus Capital.
- ROME Therapeutics, a Cambridge, Mass.-based biotechnology company targeting repeatome in drug development, raised $50 million in Series A funding. GV, ARCH Venture Partners and Partners Innovation Fund were the investors.
Airtable, a San Francisco-based maker of collaborative software is speaking with investors about raising at least $50 million in a round that would value the business at between $2.5 billion and $4 billion, per the Information. Read more.
- - Actym Therapeutics, a Berkely, Calif.-based immuno-oncology company, raised $34 million in Series A funding. Boehringer Ingelheim Venture Fund and Panacea Venture led the round, and were joined by investors including Illumina Ventures, Korea Investment Partners, and JLo Ventures.
- Templafy, a Copenhagen-based provider of enterprise document creation, raised $25 million in Series C funding. Insight Partners led the round.
- Clever Care Health Plan, a Little Saigon, Calif.-based provider of Medicare Advantage health plans fitting to cultural needs, raised $20 million in Series A funding. Norwest Venture Partners led the round, and was joined by Global Founders Capital.
- Bijak, a New Delhi, India-based B2B platform for agricultural commodities, raised $12 million in Series A funding. RTP Global led the round, and was joined by investors including Omnivore, Omidyar Network, Sequoia India’s Surge, and Better Capital. Read more.
- Auditoria.AI, a Santa Clara, Calif.-based company employing AI in finance process automation, raised $6 million in funding. Neotribe Ventures, Engineering Capital, and Firebolt Ventures led the round.
- Tinvio, a Singapore-based commerce platform, raised $5.5 million in funding. Surge, Global Founders Capital, and Partech were among the investors.
- Relish, a Westchester, N.Y.-based relationship training app for happier, healthier romantic relationships, raised $5 million in Series A funding. Bessemer Venture Partners led the round and was joined by investors including Trinity Ventures and Bullpen Capital.
- SimpliRoute, a Chile-based startup optimizing delivery routes with ML, raised $3 million in Series A funding. TheVentureCity led the round.
- Varden, a Melbourne-based company converting waste material from sugarcane into packaging product, raised $2.2 million in funding from Horizon Ventures. Read more.
PRIVATE EQUITY
- American Pacific Group in partnership with Joe Falsetti of Dana Holdings acquired SaltStick, a Malibu, Calif.-based electrolyte replenishment supplement maker. Financial terms weren't disclosed.
- Stirling Square Capital Partners acquired Assistansbolaget Försäkring Sverige, a Swedish roadside assistance provider. Read more.
- Verdane partnered to merge Conscriptor, a Swedish developer of medical journal documentation services, and Max Manus, a Scandiadvian speech recognition company. Read more.
OTHERS
- Twin River Worldwide Holdings (NYSE: TRWH) agreed to acquire Eldorado Shreveport Resort and Casino and the Mont Bleu Resort Casino & Spa, based in Shreveport, La. in Lake Tahoe, Nev. respectively, from Eldorado Resorts for $155 million. Twin River also agreed to acquire Bally's Atlantic City Hotel & Casino for $25 million in cash from Caesars Entertainment and Vici Properties.
- Speedcast International, an Australian satellite-communications company that connects cruise ships and oil rigs to the internet, filed for bankruptcy protection in the U.S.
- Cinemex Holdings USA, a Miami, Fla.-based operator of 41 CMX Cinemas locations in 12 states, filed for chapter 11 protection. Read more
- Diamond Offshore Drilling, a Houston-based contract drilling company, filed for Chapter 11 bankruptcy protection. Read more.
- Rewe, a German supermarket chain, is looking for takeover candidates. Read more.
- Imperial Brands, a U.K.-based tobacco company, is offloading parts of its premium cigar business to focus on vaping and pay down debt. The company is selling assets worth 1.23 billion euro ($1.33 billion). Read more.
IPOs
- ADC Therapeutics SA, a Switzerland-based biotech focused on antibody therapies for cancer, re-filed to raise $100 million. It posted revenue of $2.3 million and losses of $116.5 million in 2018. Auven Therapeutics (42.8% pre-offering) and AstraZeneca (7.1%) back the firm. It plans to list on the NYSE as “ADCT.” Read more.
- Ebang International, a Zhejiang, China-based maker of equipment for cryptocurrency mining, filed to raise $100 million. It posted revenue of $109.1 million and loss of $10 million in 2019. It plans to list on the NYSE or the Nasdaq as “EBON.” It previously sought to raise in Hong Kong. Read more.
EXITS
- Hg agreed to acquire a stake in smartTrade Technologies, an Aix-en-Provence, France-based multi-asset electronic trading solution, from Keensight Capital and Pléiade Venture. Financial terms weren't disclosed.
F+FS
- The Ontario Municipal Employment Retirement System raised $750 million for a venture capital fund to back early-stage technology companies in North America and Europe. Read more.
PEOPLE
- Flexstone Partners, an affiliate of Natixis Investment Managers, hired Kristof van Overloop as a Director.


fortune--2020-04-27--What stir-crazy New Yorkers are calling 311 to complain about now

New York is a city founded on an ethos of “You do your thing, I’ll do mine.” But the coronavirus lockdown is leading New Yorkers to pay closer attention to one another’s behavior, judging by new patterns in calls placed to 311.
The city, the U.S. epicenter of the pandemic, has effectively been at a standstill since March 16 when restaurants, gyms, and most stores went dark. The statewide lockdown is in effect until May 15, though, New York Gov. Andrew Cuomo said it could be be extended.
And during this shutdown, New Yorkers’ attitudes toward calling out one another’s perceived misbehaviors are changing.
The city’s 311 nonemergency hotline got its first complaint about someone purportedly not adhering to social distancing rules on March 28. Since then, it has become the fastest-growing source of complaints, according to numbers crunched by data scientists at SAP SE. From that first complaint through April 23, some 17,682 calls have come in to say a fellow New Yorker has stood too close to another.
“Our worlds have been downsized to only our apartments, and we’ve lost our baseline level of control,” said Greg Kushnick, a New York City–based psychologist. “We resort to behaviors that will give us a sense of control.”
In the period from March 1 through April 23, the social distancing complaint tally was second only to the 23,623 people reporting loud music or parties in a residential area, a standby of New York life but perhaps one people with frayed nerves are less tolerant of now.
But calls to complain can also go too far. Other cities have seen big upticks in citizens complaining about one another on social distancing: Montreal’s police department set up a web page for people to place complaints about social distancing scofflaws, but the force, required to send an officer to investigate any complaint, soon found itself telling people this was for flagrant behavior, not for snitching or acting like Big Brother.
Another soaring, though until recently rare, type of complaint emblematic of our times: the behavior of retail stores. According to SAP, complaints here rose 12-fold to 12,130 calls in March and April compared with January and February combined. That’s hardly surprising given the crackdown on price gouging as New Yorkers stocked up on hand sanitizer, disinfectant wipes, masks, and everyday food like rice and milk. And in a sign some New Yorkers might be taking to the suburban-like quiet enveloping the city these days, complaints about loud talking on the sidewalk are way up.
Across all categories, calls to 311 were down 17% during that period because so many aspects of our daily life that what would typically keep 311 operators busy fielding calls are on hold.
The biggest decline is in requests for the removal of large bulky items because of the halt on construction. There have been fewer pothole complaints, partly because people are staying home more but also likely because of a mild winter. And complaints are down for a longtime target of New Yorkers’ ire: taxis.
With the suspension of alternate-side parking rules, which limit parking to one side of the street on different days, complaints about illegal parking have evaporated. And with driving way down, fewer New Yorkers are calling to complain about a blocked parking space.
While New Yorkers have shown their softer side by largely complying with stay-at-home rules and making a daily collective racket at 7 p.m. from their apartment windows to honor health care workers, they have not been shy about telling each other to zip it and calling 311 for reinforcement. Even in quarantine, New Yorkers are New Yorkers.
Dive into stories from Fortune’s print edition:
—The trillion-dollar question: How far will GDP fall?
—How each industry is fueling the U.S. unemployment rate in one chart
—What we can learn from China’s color-coded apps for tracking the coronavirus
—The retailers that are smartest about tech will finish on top after the coronavirus pandemic has abated
—Big Pharma has the chance to come to the world’s rescue
—More surveillance and less privacy will be the new normal in the wake of the pandemic
—WATCH: Ford CEO Jim Hackett on the company’s pivot to combat the coronavirus
Subscribe to Outbreak, a daily roundup of stories on the coronavirus pandemic and its impact on global business, delivered free to your inbox.


fortune--2020-04-27--Digital currencies move from talk to action

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Last year, when hopping on a plane to discuss trending business topics was normal, the notion of a world with digital currencies was all the rage at two Fortune conferences. Last June, in Montauk, N.Y., Facebook-affiliated Libra had just released some details about its plans. It was the talk of Brainstorm Finance. Closer to the end of the year, at the Fortune Global Tech Forum in Guangzhou, a hot topic was the Chinese government’s intention to launch a digital currency.
Now that we’re all grounded, digital currencies have moved from talk to action, at least in some cases and some places. Libra has grown quieter and perhaps less ambitious, though the coalition of companies and investors Facebook assembled to work on it continues. In China, meanwhile, the People’s Bank of China has begun a limited test of an actual digital currency that couldn’t be more different than the so-called cryptocurrencies of libertarian fever dreams, like Bitcoin.
China’s experimental currency, which doesn’t have a name yet—Silicon Valley would have done better at this, at least—will be tightly controlled by the Chinese government. Right now it is noodling with using the currency for transit payments, a modest start.
But it is a start. As Jen Wieczner reports in the current issue of Fortune, “fintech” companies of all stripes are getting a boost from their role in moving money during the pandemic. And Coinbase’s Michael Casey argued in a Fortune essay that the U.S. runs the risk of letting China build a big lead if it doesn’t get its act together soon.
***
Speaking of the U.S. not having its act together, I highly recommend this lucid, important essay by Jim Yong Kim former president of the World Bank, about what’s needed to move forward to fight the pandemic. He argues that only by using five—and all five are required—tools can the pandemic be beaten: social distancing, contact tracing, testing, isolation, and treatment. It’s simple, but extremely difficult to pull off.
***
For my next Data Sheet conversation, I’ll be chatting with longtime tech analyst Gene Munster about how he sees the investing environment playing out. The call is live on Wednesday, April 29, at 10 a.m. Pacific/1 p.m. Eastern. Once again, I’ll take your questions via chat. (This call will be audio only: you have permission to multi-task.) Register here to listen and participate.
Adam Lashinsky
@adamlashinsky
adam.lashinsky@fortune.com
This edition of Data Sheet was curated by Aaron Pressman.
NEWSWORTHY
I know where you've been. As Apple and Google perfect their contact tracing system, excuse me, exposure notification system, some countries are moving ahead. Australia launched an app that uses Bluetooth to track proximity and a national database to store the data, ignoring the companies' system. Germany, however, appeared to change course and dropped plans for a central server in favor of the tech companies' approach, which stores data on individual phones. Companies including PwC are making tracing apps for their employees, as well.
My complication had a little complication. Speaking of Apple, in one of those stories that's obviously important inside the company but of unclear importance to all the rest of us, the Wall Street Journal reports that Apple has delayed the start of its annual manufacturing push for new iPhones by one month. Does that mean the new iPhones won't be introduced or go on sale in September per usual? We do not know. Apple, per usual, declined to comment.
There's gonna have to be a different man. About six months earlier than expected, AT&T CEO Randall Stephenson is stepping down. His top lieutenant and life long Bell employee John Stankey takes over on July 1. Now all three major phone companies will have switched CEOs in the past few years. Hans Vestberg took over at Verizon in August, 2018, and Mike Sievert just took the reins at T-Mobile on April 1.
Limberg gets pretty mean. Gaming giant Nintendo said Friday that hackers “obtained illegally” the personal IDs and passwords about 160,000 online accounts. Additional information like people’s names, date of birth, country, gender, and email addresses may have been exposed.
FOOD FOR THOUGHT
While the U.S. endlessly debates privacy protection, lawmakers in Europe already did something about it. Two years ago, they adopted the General Data Protection Regulation, or GDPR. But it hasn't quite worked out as well as the law's proponents had hoped, as Adam Satariano reports for the New York Times.
In a February survey of privacy regulators in 30 European countries, 21 responded that “resources are not enough” to fulfill their responsibilities. Luxembourg, which is responsible for regulating Amazon, had a budget of roughly €5.7 million last year, worth about $6.2 million, or roughly Amazon’s sales over 10 minutes.
“We have a lack of enforcement,” said Ulrich Kelber, the chairman of Germany’s data protection authority, which has the highest budget in the European Union, at roughly €85 million when including regional agencies. “Most of the European governments don’t give enough resources to the data protection authorities.”
IN CASE YOU MISSED IT
Work from home tips from the executive team that brought you Zoom By Michal Lev-Ram
Facebook debuts Zoom-like video chat feature called Messenger Rooms By Danielle Abril
A.I. will be crucial to companies outside of Silicon Valley—and they need a new playbook for it By Andrew Ng
How retailers retooled podcasts to connect with customers and staff during the coronavirus pandemic By Kate Bowers
Vending machines—the original contactless delivery systems—now deliver ramen and art to U.S. consumers By Margaret Littman
5 ways to find unadvertised job openings By Gwen Moran
(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
Not quite sure if this is real or a joke, but if it's a joke, it's pretty funny. So, game developer Jacob Janerka and animator Ivan Dixon are pitching to make a game about nothing, aka The Seinfeld Adventure Game. They lay out their hilarious if insane plan with a web site and trailer video. The idea (?) is that the pitch catches viral fire with the hashtag #seinfeldgame and the rights owners grant them a license to make the game. If not, no soup for you.
Aaron Pressman
@ampressman
aaron.pressman@fortune.com


fortune--2020-04-27--Houseparty CEO Sima Sistani meets the ‘massive technical challenge’ of coronavirus video chat demand

Good morning, Broadsheet readers! AutoNation returns almost $80 million in government coronavirus relief, black leaders push Joe Biden to put a black woman on his ticket, and the chief executive behind Houseparty works to meet unprecedented demand. Have a productive Monday.
– Sistani in the House. The vast majority of the video-chat businesses suddenly at the center of nearly all social interaction—like those of Microsoft, Google and the newly ubiquitous Zoom— are run by men. Sima Sistani is the rare female social video founder and CEO dealing with the increased demand of a global pandemic.
Sistani co-founded Houseparty, a platform that lets users chat and play games in a more informal and spontaneous setting than the usually scheduled Zoom call. Since the pandemic began, Houseparty has added 50 million users, with especially strong growth outside the U.S.
Houseparty was acquired by Fortnite maker Epic Games for an undisclosed sum last year, and Sistani says the company wouldn’t have been equipped to keep its service running over the past few weeks if it were still in startup mode. “Being able to support an influx of new signups while also being able to support higher concurrencies than ever before is a massive technical challenge,” Sistani told me in a phone interview (she wanted to talk over Houseparty, of course, but I didn’t get the desktop version set up in time). “It’s difficult even when it’s sustainable day-over-day growth, and it ended up being so much bigger than that.”
Sistani has been hesitant to speak publicly about Houseparty’s unprecedented growth for fear of appearing to capitalize on global tragedy. And at the same time as she’s navigating these significant technical challenges, she’s also leading a workforce of about 100; a longtime advocate for paid leave in Silicon Valley, she’s figuring out how to translate that commitment to the kind of resources employees need for their mental and physical health now.
“I’d hate for people to think we’re taking a victory lap on this,” she says. “But while this was happening we buckled down around the great responsibility we had to keep the app stable for those needing it to connect with each other.”
Emma Hinchliffe
emma.hinchliffe@fortune.com
@_emmahinchliffe
ALSO IN THE HEADLINES
- Alleged mastermind. A shareholder lawsuit accuses Shari Redstone of forcing through the CBS-Viacom merger to protect her financial interest in Viacom. The lawsuit paints Redstone as a "deal-making mastermind;" ViacomCBS says the complaint is "without merit." Wall Street Journal
- Which woman? Joe Biden has pledged to choose a woman as his vice president, and black leaders are pushing the presumptive Democratic nominee to put a black woman on his ticket. Those influential figures, though, are divided about whether Sen. Kamala Harris, Stacey Abrams, or someone else should get the spot. New York Times
- Dealer's choice. Car dealership network AutoNation, which was led by CEO Cheryl Miller until she took a recent health-related leave of absence, received at least $77 million in government money through the Paycheck Protection Program. The company received the payout by applying through its individual dealerships. Amid questions about why such a large company should qualify for the aid even as small businesses struggle to qualify, AutoNation's board voted to return the funding. Washington Post
- Dictatorship dynasty. With conflicting reports out this weekend about the health of North Korean leader Kim Jong Un, his sister Kim Yo Jong is getting a closer look. This New Yorker piece examines how she could lead the patriarchal and sexist regime. The New Yorker
MOVERS AND SHAKERS: The Biden campaign replaced Democratic National Committee CEO Seema Nanda with Mary Beth Cahill.
IN CASE YOU MISSED IT
- City and state. Governors and mayors have been praised for their coronavirus responses, but leaders in the two positions have often sparred with each other. From Atlanta Mayor Keisha Lance Bottoms and Georgia Gov. Brian Kemp to Las Vegas Mayor Carolyn Goodman and Nevada Gov. Steve Sisolak to Portland Mayor Ted Wheeler and Oregon Gov. Kate Brown, the disagreements run the gamut. LA Times
- Quota for quota alternatives. Female board members want greater gender representation in directorships, but many are uncomfortable with government-imposed quotas. Here, the Diligent Institute's Dottie Schindlinger argues in favor of three alternative ways to increase board diversity: Fortune
- Childcare restrictions. In Japan, children of medical professionals are being barred from daycare centers unless their parents can prove they aren't infected with the coronavirus. The lack of access to childcare is leading some nurses and doctors, especially women, to quit the workforce. Bloomberg
- The risks of Ramos. Last week's Supreme Court decision on Ramos v. Louisiana was about divided juries—but it's causing some worry about the future of Roe v. Wade. The decision showed some willingness on the court to overrule precedent, which makes it more likely that the conservative majority could do the same on abortion rights. Washington Post
ON MY RADAR
Recipe queen Alison Roman’s popularity, explained by Alison Roman Vox
FOMO is over. Give in to the Joy of Letting Go New York Times
Tory Burch is fighting for US fashion’s aid Vogue Business
PARTING WORDS
"I am, in case you haven’t noticed, an optimist. But I’m an optimist who worries a lot."
-Madeleine Albright on the future of U.S. foreign policy. Her new book is Hell and Other Destinations: A 21st Century Memoir.


fortune--2020-04-27--Airbnb hopes new cleaning guidelines will bring guests back after the pandemic

Subscribe to Outbreak, a daily roundup of stories on the coronavirus pandemic and its impact on global business, delivered free to your inbox.
Airbnb is pushing out a new set of cleanliness standards for hosts, developed with guidance from a former U.S. surgeon general in the Obama administration.
The Enhanced Cleaning Initiative boils down to two prevention measures, both of which are meant to provide assurance to guests and tools for hosts once shelter-in-place mandates owing to the spread of COVID-19 are lifted and travel can resume.
“We have seen signals that the COVID-19 pandemic will shape consumer needs and preferences and heard feedback from our host community that they care about and want more resources,” an Airbnb spokesperson tells Fortune. “We believe that enrolling in our Enhanced Cleaning Initiative, with guidance and resources provided by Airbnb, is the best way for hosts to show guests that they take cleanliness and sanitization seriously.”
An Airbnb offering in Beaufort, Victoria, Australia. Courtesy of Airbnb
The first is a cleaning protocol, outlining procedures on how to clean every room in a home, with specific information on COVID-19 prevention. Coronavirus-specific guidance includes instituting a waiting period before entering the home, use of personal protective equipment (masks and gloves), and the use of disinfectants on surfaces and hand sanitizers that are approved by regulatory authorities. Guests will be able to search for Airbnb listings that subscribe to the regulations.
The second is a new feature called Booking Buffer, enabling hosts to establish a vacancy period between stays. Hosts can commit to keeping their residences empty for a set period in between stays, with no activity other than cleaning. Reservations will be automatically blocked during that time frame, currently set at 72 hours. This concept was first conceived for Airbnb’s Frontline Stays project, through which hosts have offered over 200,000 places for medical workers and first responders around the world.
Airbnb acknowledges that the first option takes into account that some hosts may not be able to commit to certification or source necessary products. But the rental agency stresses that hosts should still observe CDC recommendations and other applicable local guidance (such as wearing a mask).
The initiative is entirely optional, but Airbnb believes most of its hosts will comply with the policies and requirements of the program—if only to stand out among the robust guest reviews that are crucial for hosts to attract guests at any point in time.
The homestay company’s cleaning standards were informed by the U.S. Centers for Disease Control and Prevention’s published standards as well as counsel from former surgeon general Dr. Vivek Murthy, who previously led U.S. responses to the Ebola and Zika outbreaks. “As a society, we need to observe the physical distancing recommendations made by public health officials while finding ways to preserve and strengthen human connection,” Murthy said in a statement.
Airbnb is encouraging hosts and guests to take all necessary precautions when hosting and traveling, including following official health and governmental guidance. Courtesy of Airbnb
Airbnb’s financial health during the pandemic has been touch and go at best, with business forecasts and interviews with company executives projecting an outlook from grim to apocalyptic. The San Francisco–based company’s bottom line had already been hurting before COVID-19 struck, and while the cleaner standards protocol suggests a hint of light at the end of the tunnel, travel of any kind—business or pleasure—is not expected to rebound in 2020.
Nevertheless, Airbnb, which operates in more than 220 countries, says it has already seen signs of upticks, including increases in local and long-term stays. “Risk in travel can never be fully eliminated, and the knowledge around COVID-19 is still evolving,” says the company spokesperson. “We’re confident that once stay-at-home orders are lifted and it is safe to travel again, people will want to travel again, but with greater awareness for health and cleanliness considerations.”
Beyond cleanliness, Airbnb has taken other steps to protect its hosts. In March, the company’s three cofounders reportedly spoke with several members of Congress to ensure at least U.S. hosts—who often file their taxes as sole proprietors—would be eligible to apply for Small Business Administration emergency loans.
More coronavirus coverage from Fortune:
—Bill Gates explains how to beat the coronavirus pandemic
—The U.S. is learning why limiting hospital beds carries a steep cost
—Instacart to hire 250,000 more workers amid soaring demand
—What to know if your small business is applying for Round 2 PPP loans from the SBA
—14% of women considered quitting their jobs because of the coronavirus pandemic
—The 3-pronged approach to defeating the coronavirus
—Why the coronavirus crisis makes moral leadership more important than ever
—PODCAST: COVID-19 might have upended the concept of the best companies of the year
—VIDEO: 401(k) withdrawal penalties waived for anyone hurt by COVID-19
Subscribe to Outbreak, a daily roundup of stories on the coronavirus pandemic and its impact on global business, delivered free to your inbox.