Uber

Handcuffed to Uber

Plenty of people would give everything to be an early employee at seven-year-old Uber. But Uber employees who’ve been with the ride-share company for at least a few years have discovered a considerable downside to their ride with the transportation juggernaut. They can’t afford to quit. Startup employees have to exercise their options within 90 days of leaving a company or else lose them and at Uber, that cost is simply too high.

A quick scan of LinkedIn for former employees underscores the point. Of Uber’s roughly 6,700 employees, only a tiny fraction have left, and in most cases, those hires weren’t around long enough to be worrying about vested options.

Employees of privately held companies have long wrestled with this issue. (We wrote about it here last summer.) With valuations of many privately held tech companies having soared so dramatically in recent years, the amount of capital needed to buy employee options has escalated at an unprecedented pace for employees at a variety of places.

Uber appears to be the most extreme example ever, however. In a completely hypothetical example, let’s say an early, top Uber engineer was given .5 percent of the company. Now let’s say this person was awarded options in 2011, when Uber raised $11 million in Series A funding at a reported $60 million valuation. His ownership stake at the time would have been $300,000. Yet today, that same stake (undiluted) would now be worth $300 million at Uber’s reported current post-money valuation of $60 billion. That’s a paper gain of $299,700,000.

It’s very hard to cry about that, it’s true. But there is bad news: at a 40 percent tax rate for short-term gains, if the engineer opted to leave Uber, he’d confront a tax bill of $119,880,000, not including that earlier $300,000 needed to exercise the options. And leaving Uber would start the clock. He’d have just 90 days to come up with the $300,000, and he’d have to come up with the rest of the money for the much larger tax bill by the next April 15.

Maybe Uber will be publicly traded by then. Maybe it won’t.

Some highly valued companies have tried to ease this issue for employees by allowing them to sell some of their sales to preapproved secondary sellers at certain points. Not so Uber, which amended its bylaws in 2013 to restrict unapproved secondary sales. Not only does it not allow employees to sell their shares to secondary buyers, it also won’t allow them to use services like those offered by 137 Ventures, which makes loans to founders and early employees, using their stock as collateral. (Snapchat, Dropbox, and Airbnb have similar policies.)

Our sense is that the company doesn’t mess around, either. Four secondary players have told us of employees who’ve tried to find ways around Uber’s regulations, only to be stymied. “We’ve been approached by big groups of early employees, and I know a lot has been written about loans or hypothetical products to get around its policies,” says one source. “But Uber’s position is that if it learns [of a sale or loan] that goes around its share-transfer restrictions, there will be consequences.”

It may seem uncharitable on some level, but it’s very much by design, according to insiders, who say Uber CEO Travis Kalanick has two primary motivations for keeping his company’s shares on lockdown.

More here.

(Photo: Bryce Durbin)

It’s Not Just Uber: Carnegie Mellon’s Computer Science Dean on the School’s Poaching Problem

Andrew Moore was a professor of computer science and robotics at Carnegie Mellon University for a dozen years when Google hired him away in 2006 to lead some of its efforts around ad targeting and fraud prevention.

CMU lured Moore back in 2014, making him the dean of its computer science school. But he still understands well what goes through his colleagues’ minds when industry comes calling, and he says the battle to keep them in academia grows fiercer by the year.

Earlier today, we talked with Moore about Uber, which famously raided the school’s robotics department a year ago, poaching 40 of its researchers and scientists. We also talked about how Moore entices people to stay, and the newest new thing his 2,000-student school is focused on right now. Our chat has been edited for length.

Sorry to start with a question you’re surely asked too often, but just how big a hit did the school take when Uber recruited away some of your professors and researchers?

This kind of thing happens from time to time, especially in fast-growing areas where academia and industry are advancing things all the time. In January 2015, Uber hired away four faculty and about 35 technical staff to start its Advanced Technologies Center in Pittsburgh. By the school’s standards, this is one of many examples where our faculty disappear for a while into industry. It happened to me. Usually, every year, between five and 15 faculty members take a leave of absence for one or two or up to four years. Some never come back. Most do.

The perception was that this was a significant wave, though.

And that public perception is what really hurts. The truth is we have about 40 faculty and four took a leave of absence for a while to work for Uber. Meanwhile, this is such a growth industry that we’ve hired 17 new faculty in the past year, about half in robotics and half in machine learning. It’s frustrating. We’re trying to find space for new robotics people, not suffering from a lack of them.

What’s the school’s relationship with Uber like today? Is there one?

More here.

Sequoia’s Alfred Lin on Why Uber’s Valuation is Twice That of Airbnb

Today, at the Post-Seed conference in San Francisco, Alfred Lin, the former COO and CFO of Zappos and now a Sequoia Capital partner, was asked a variety of on-stage questions about the current market.

Among them was whether Lin thinks it’s a good time to start a fund. “Probably not,” he said. “Valuations are high. But it doesn’t matter if you’re [thinking] long term,” he said. “If you’re building something enduring, you’re going to face lots of ups and downs anyway and you might as well start today.” As he noted, “It only gets more competitive in this world” of investing.

Lin was also asked about the changing landscape and talked about the slowdown he expects next year, prompted by rate changes that the Federal Reserve is expected to enact shortly. “With interest rates close to zero, you can’t make money in the bond market,” he said. “So the bond people now invest in stocks, and people who invest in stocks invest in private growth rounds . . . and VCs invest in seed deals.” That’ll all change when the Fed starts raising rates, which Lin anticipates it may do “maybe even once a quarter.” Once that happens, he said, “There will be less money chasing companies all the way down the spectrum.”

Lin was also asked to take a look back and address some of Sequoia’s most impactful decisions in recent years. He was asked, for example, why Sequoia invested in the accommodations marketplace Airbnb but passed on the ride-sharing company Uber.

More here.

A Third Worker Classification? Don’t Bet On It

Lately, there’s been a steady drumbeat of accusations that on-demand startups are unfairly wringing profits out of independent contractors. The concern: no one is withholding their taxable wages for them, they aren’t being given health care, and they have almost none of the same protections as full-time employees. In fact, one of the only protections independent contractors are provided under federal law is from race discrimination. In 2008, California’s Fair Housing and Employment Act was amended to give independent contractors protection against sexual discrimination, but many states don’t even go that far.

Maybe it’s no wonder that, to deflect such criticisms, a growing number of on-demand management teams and investors have begun suggesting that a third classification of worker – one poised to enjoy both flexibility and greater worker protections – is around the corner.

During a panel that StrictlyVC moderated in May, Simon Rothman of Greylock Partners, whose bets include the food-delivery startup Sprig, told attendees, “I personally think the 1099 [tax classification] framework is broken. It existed in a world of monolithic, centralized corporations, not in a world of distributed companies, so I think there needs to be a third class of worker [and that we’ll eventually have one], though it will take a while.”

Longtime employment attorneys say not to count on it.

For more of this story, read on.

Talking 1099 Workers (and More) with Redpoint’s Ryan Sarver

Last week, the California Labor Commission found that a San Francisco-based Uber driver should have been legally classified as an employee, and not a contract worker, by the company.

The ruling could be a very big deal for Uber and many other on-demand companies that argue they’re an appealing alternative to people who want to work flexible hours and to be their own bosses — even if they aren’t paying them unemployment, workers compensation or health benefits, all of which would cost such companies roughly 30 percent more per worker.

The ruling could also be a big deal for investors who’ve poured hundreds of millions of dollars into such companies, though at a dinner last week with partner Ryan Sarver of Redpoint Ventures, it was clear that Sarver isn’t concerned about Uber and its ilk losing this fight. We talked at some length about the case, as well as what types of on-demand companies Sarver wouldn’t be inclined to fund, regulatory tussles notwithstanding. Our chat has been edited for length.

You’ve invested in a number of on-demand companies, including [the peer-to-peer car buying and selling marketplace] Beepi and [home-cleaning service] Homejoy. If contract workers are reclassified as full-time workers, what happens to them?

It’s so hard to predict where things are going to go. There’s a huge new class of people who really want flexible work, and that shift is happening and it’s growing and it’s not going away. You’re then trying to match regulation to them that was written in the 1930s and hasn’t been updated since. I don’t know where we land, but we need regulation that maps to those trends.

What if we don’t get it? How big an impact would that make on, say, Luxe [an on-demand valet service that Redpoint has also backed]?

It’s hard to say until we know what the rulings are going to look like, but labor is really important and Luxe is competing for it with Uber and Beepi and other [on-demand services]; it’s competitive. And [success] will come down to who can attract and retain that labor.

Toward that end, what should these companies’ priorities be? Helping their contract workers land health care? Educating them about savings? Beyond the break room and free snacks, how do you win the labor race?

Churn on the supply side is a big problem for a lot of these on-demand companies, so many of them are focused on hiring, training, and retaining [contract workers]. I think you need more than [break rooms], I agree. What Luxe is doing is giving employees a career path. If you become a really good valet, you become a shift captain. If you become a good shift captain, you can move inside Luxe’s operations center and become a full-time employee. I think smart companies are telling these employees: maybe you want flexible schedules now, but down the road, if you want to move into a full-time position, we’re also going to offer that to you.

A new layer of companies is emerging to cater to these contract workers, providing them with shift-management software and other things. As an investor, do you think they’re interesting?

The on-demand labor market is still pretty small; even with a million or so [on-demand] drivers around the world – that’s still a small labor force. As it continues to grow, maybe it becomes more interesting over time, but I think it’s a little too early to tell [what the potential] of those services will be.

What’s the craziest business you’ve been pitched?

Well, I did see bodyguards on demand. [Laughs.]

Are you interested in telemedicine or these other on-demand startups that don’t require big city rollouts?

I’m a big Doctor on Demand user and I love it, but it’s super infrequent. You’re going to use it in the moment, not every week [because it costs $40 for a 15-minute consultation]. There’s another startup, Better, that gives users access to “personal health assistants” that you might use on a more frequent basis, like, “Hey, our little guy has a rash, what should we do?” I think eventually, there will be a blending of the two, so that you can touch a service in a lightweight way and escalate [to the doctor level] if you need to.

[Most consumer spending] goes to transportation, food, and housing, though healthcare is also an enormous one.

Housing is interesting. What do you think of OpenDoor, the on-demand online home-selling service?

We [invested in] Beepi and they’re very similar models from what I know. OpenDoor will take inventory and buy it from you and fix it up and resell it. Beepi won’t fix up your car, but they’ll send in a mechanic who has a very structured checklist and goes through the service and gives you a price to buy it that day and take it off your hands and bring it into their inventory. Then someone can buy it sight unseen because they trust that the mechanic has done the work and priced it properly.

I think OpenDoor is doing something very similar, but they’re trying to increase the value of the homes. It’s really interesting and much more complicated than what Beepi is doing. It’s a very big swing.

StrictlyVC: May 18, 2015

Hi, welcome back, everyone! Hope you had a terrific weekend.

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Top News in the A.M.

Google will reportedly launch buy buttons on its search-result pages in coming weeks, pitting it more directly against online marketplace rivals, including Amazon and eBay.

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Uber Exec Tom Fallows on the Company’s Culture, and More

At a StrictlyVC event in San Francisco last week, Tom Fallows, Director of Global Expansion Products at Uber, talked with us about what’s important to Uber right now, why Uber sees the fight for India and China as far from over, and the various ways that Uber and Google differ culturally. (Fallows was hired away from Google late last year. He’d previously spent five years with the search giant, developing, among other things, the Google Express delivery service.)

Fallows couldn’t answer questions about Uber’s funding situation or its reported bid on Nokia’s mapping business, but he was refreshingly forthcoming when answering others. Our chat, edited for length, follows.

Explain what you do.

Obviously, we have the mainline business of offering transportation to people; [my job is largely looking into] how do we expand into new opportunities. Uber for Business is one of my projects, for example, and that’s just building an enterprise version of Uber so that companies large and small can use it for their business travel.

Is that taking up the majority of your time? How many initiatives are you working on at any one time?

It is taking up the majority of my time. I have six different teams that are working on new projects all the time, and in a healthy ecosystem way, projects that aren’t working get wound down or swallowed up and resources [are] diverted.

Can you point to something that’s been shut down recently?

Nothing since I’ve been [at Uber]. But I remember while at Google, reading about Uber testing a concept [to deliver common convenience store items to select customers through a pilot project] in Washington, D.C that no longer exists.

What can you tell us about how some others of its initiatives — including delivering food and packages — are doing?

I can’t discuss any numbers, but as the press has reported, the Uber Eats [food delivery] product has expanded into several more cities and I think the market has been pretty strong. We’re doing well with Uber Rush, which is a [bike] courier service [that Uber rolled out in New York a year ago].

What do you make of the argument that not everyone wants Uber to deliver both their food and their transportation — that people want different relationships with different brands?

I don’t think consumers inherently care about how their item is getting to them so long as it’s getting to them effectively and quickly.

You founded Google Express. The service has been portrayed in the press as troubled recently, including because the head of Google’s commerce businesses, Sameer Samat, has left to join Jawbone as president. Is that fair?

I can’t speak to recent stuff, but when I left five months or so ago, but it was doing well. I think it’s the wrong conclusion to draw that [Samat’s departure] is a reflection on the commerce business. It’s a big driver of growth, and a big driver of profitability [at Google]. I don’t know anything but I suspect this was a poaching situation.

The problem we had at Google Express was that we didn’t have enough capacity. Like every single delivery and on-demand service out there, we had such product-market fit that we just couldn’t keep up with demand. At Uber, that causes surge pricing. At Shopping Express, that caused sellouts, and that was always the pain point that we were dealing with.

Can you confirm that Uber is currently raising $2 billion more from investors at a $50 billion valuation?

I read about it as you guys did [in the audience]. I have no idea.

If the company were to raise $2 billion, what would its top priorities be? Expanding domestically? Competing more aggressively in India and China?

I don’t in any way tie this to a fundraising. I literally don’t know anything about it and don’t know if or why we need more money, but the company had said in the last funding round that there are big global opportunities that we’re going after, and in our type of business, for anybody building liquidity and network effect and going into new markets, it can be very expensive.

India and China are obviously big battlegrounds. How do you compete with regional taxi app companies that have something like 99 percent of the market?

China and India are huge potential markets and places where we really want to participate and where we think we can offer great service. [And] although the alternatives in China are very big, the majority of the business is in the taxi ride hailing, which isn’t a business, it’s purely a matchmaking business. They take no fee whatsoever. They have, similar to us, black car and Uber X [type] businesses, but they aren’t nearly as big, so it’s not . . . an open-and-shut case.

One thing that’s interesting: The transportation business is truly, inherently local. At Google, of course, we could do localization, and we had sales teams in each country, but we didn’t have tech teams or custom features in that many countries, whereas at Uber, you really have to serve every single city independently — even within the U.S. We consider it a strategic advantage, our ability to operationalize at scale the management of these locations that need custom technology and custom solutions.

What are some other differences between these two powerful companies? We know you joined Uber just five months ago, but are there early impressions you can share?

Well, the first, strange [observation I made] when I walked into Uber was that one out of three people is a former Google colleague. There are also lots of people from Facebook. Top to bottom at Uber, it’s [top-notch employees].

The biggest difference at Uber is that, at heart, it’s still very much a startup with an action bias. In my first couple of weeks, we’d be talking about a new feature and inevitably in that conversation, the question would arise: How long would this take to get out? And someone would say, “I think it’ll be two to three . . .” And in my head, I’d just default, think weeks. And they’d finish, “…days.” And I think, what? [Laughs.]

It’s a combination of a couple things. It’s much younger technology stack. Also, we’ve all had that experience where something needs change and you just change it and 12 minutes later it’s in the world, and Uber is still on that continuum versus my experience at Google, which, I absolutely love the people and I have nothing but great things to say about it, but it’s not necessarily known for its nimbleness and speed. One of the challenges I had with Google Express was how do we launch and iterate in an environment where you have multi-week review cycles, and all for good reason. Everything had a justification behind it. It’s all part of being a big company. But it’s inherently slower.

You get the feeling that nearly everything trickles up to Larry Page at Google. At Uber, whose sign-off do you need?

Very explicitly, the rule inside is: nobody needs to sign off.

(For more of our interview with Fallows, click here.)

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New Fundings

Abcodia, a 4.5-year-old, U.K.-based biotech company that has developed an ovarian cancer screening test that it plans to bring to market this summer, has raised $8.2 million in new funding co-led by Cambridge Innovation Capital and Scottish Equity Partners, with participation from earlier backers Albion Ventures and UCL Business.AllSeated, a four-year-old, New York-based maker of event planning and collaboration tools, has raised an undisclosed amount of funding from Magma Venture Partners.

Aliada, a 10-month-old, Mexico City, Mexico-based marketplace that pairs consumers with housekeeping services, has raised $800,000 in seed funding from regional investment firms Capital Invent, Variv Capital, and Dila Capital. TechCrunch has more here.

Cyber adAPT, a year-old, Half Moon Bay, Ca.-based real-time network-based threat detection platform, has raised $4.1 million in Series A funding from Alvin Fund, Granite Point Capital Partners, Griffin Fund II, and Fundamental Capital Management.Decorist, a 2.5-year-old, San Francisco-based online platform that’s aiming to make interior design personal, affordable and easier, has raised $4.5 million in funding from Lowe’s Companies, the Women’s Venture Capital Fund and other angel investors.

Drizly, a three-year-old, Boston-based on-demand alcohol delivery company, has raised $13 million in Series A funding led by Polaris Partners, with participation from First Beverage Group and previous backers, including Suffolk Equity Partners. The company has now raised $17.8 million altogether.

EasyStack, year-old, Beijing, China-based OpenStack startup, has raised $16 million in Series B funding led by RuShan Capital, with participation fromYingDong and earlier backer BlueRun Ventures. The company has raised $18 million to date.

Kapost, a five-year-old, Boulder, Co.-based content marketing software company, has raised $10.25 million from investors, including Access Venture Partners, Cue Ball Capital, Iron Gate Capital and Salesforce Ventures, as well as earlier backers Lead Edge Capital and High Country Ventures. The company has now raised at least $18.45 million altogether.

Mediabong, a four-year-old, Paris, France-based video syndication network, has raised $5 million in Series B funding from Entrepreneur Venture and Conegliano Venture, among others. The company has now raised $6.3 million altogether, shows Crunchbase.

Omada, a 16-year-old, Copenhagen, Denmark-based maker of compliance management software, has raised $24 million in growth equity funding from C5 Capital, a year-old, London-based firm.

Oyo Rooms, a 2.5-year-old, Bangalore, India-based chain of tech-driven, standardized hotels, is reportedly talking with Softbank about selling a 25 percent to 30 percent stake in its business for $100 million. According to Crunchbase, the company has thus far raised $25.7 million from investors, including Lightspeed Venture Partners, Sequoia Capital, and Greenoaks Capital Management. Times of India has the story.

Rovop, a nearly four-year-old, Westhill, U.K.-based company that makes tethered, unmanned underwater vehicles used by the offshore oil and gas and renewables industries to carry out a wide range of tasks, has raised £10m ($15.7 million) in funding from the Business Growth Fund.

ScaleFT, a months-old, San Francisc-based platform for cloud administration and security, has raised $800,000 in seed funding from Rackspace and numerous angel investors. More here.

Telogis, a 14-year-old, Aliso Viejo, Ca.-based maker of fleet management software, has raised $25 million in new funding, according to an SEC filingflagged by Fortune. According to Crunchbase, the company had previously raised $95 million, including from Fontinalis Partners and Kleiner Perkins Caufield & Byers.

Tissue Analytics, a year-old, Baltimore-based wound imaging and telehealth company, has raised $750,000 in seed funding led by the Chinese Internet giantTencent Holdings. TechCrunch has more here.

Taboola, an eight-year-old, New York-based content recommendation startup, has raised an undisclosed amount of “multi-millions” of dollars from Baidu, just three months after Taboola raised $117 million in Series E funding at a reported valuation of $1 billion. More here.

TrucksFirst, a 10-month-old, Gurgaon, India-based based logistic service provider focused on improving the efficiencies of long-haul trucking in the country, has raised $10 million in Series A funding from SAIF Partners, with participation from Singapore Post and McKinsey & Co’s Germany-based travel director Thomas Netzer. (TrucksFirst founder Deepak Garg previously spent more than eight years with McKinsey.) Tech-Portal has more here.YCharts, a 5.5-year-old, Chicago and NYC-based financial software company that provides investment research tools, has raised $6 million in Series C funding led by Morningstar, with participation from Reed Elsevier, I2A,Amicus Capital Partners, Hyde Park Angels and other individuals. The company has now raised $14.5 million altogether.

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New Funds

Draper Nexus Ventures, a U.S.-Japan cross-border investment firm with offices in San Mateo, Ca., and Tokyo, Japan, has raised $80.3 million for its newest fund, according to an SEC filing that shows a $125 million target. The firm officially kicked off fundraising last September.

Insight Venture Partners, the New York-based growth-stage venture capital and private equity firm, is nearing the close of a pair of funds totaling more than $4 billion, reports VentureWire. Insight Venture Partners IX LP fund has gathered $2.9 billion in commitments, according to a document distributed to investors and viewed by VentureWire. The other fund, Insight Venture Partners Growth-Buyout Coinvestment Fund LP, has reportedly raised about $1.1 billion so far.

Mbloom, a Maui, Hawaii-based venture capital firm focused on startups in Maui and throughout the state, has raised $10 million from a private investor in China, bringing the fund to a total of $20 million, reports Pacific Business News. The fund held a first close on the fund in January 2014 with $5 million raised from Hawaii Strategic Development Corp. and $5 million from an undisclosed private investor.

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Exits

Coherent Navigation, a seven-year-old, San Mateo, Ca.-based navigation company, has been acquired by Apple, the company confirmed yesterday. Terms of the deal were not disclosed but are expected to bolster Apple’s mapping technology and services. According to the LinkedIn page of Coherent’s CEO, Paul Lego, the acquisition took place five months ago. MacRumors has the story here.

Miaxis Biometrics, a 15-year-old, Hangzhou, China-based developer of biometric software, has been acquired for $40.6 million by the point-of-sale terminal and e-payment solutions provider Xinguodu Technology, reports Reuters.

StrikeAd, a five-year-old, New York-based advertising demand side platform (DSP), has been acquired by the publicly traded ad management platform company Sizmek for undisclosed terms. According to Crunchbase, StrikeAd had raised at least $7 million from investors in a Series A round that included Wavemaker Partners, Canyon Creek Capital, SoftTech VC, and DFJ Esprit.

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People< Fan Bao, founder of 11-year-old investment bank China Renaissance, has been involved in some of the country’s biggest IPOs and mergers. Now, his bank is scouring China’s startup scene to uncover a new wave of technology giants. Bloomberg profiles him here.

Seven employees quit payment rewards startup Clinkle simultaneously Friday, reporting owing to frustration with its 24-year-old CEO Lucas Duplan. Indeed, says TechCrunch, the remaining team is “now believed to be less than a dozen, down from 70 several years ago.” The four-year-old company has raised $30 million in funding from investors, including a $25 million round that was boldly advertised at the time as the “largest seed round in Silicon Valley history.”

Longtime LP and now Hamilton College CIO Anne Dinneen on how LPs evaluate venture partnerships.

John and Ann Doerr — both of whom hold bachelor’s and master’s degrees in electrical engineering from Rice University — have donated $50 million to the school to create a leadership institute called the Doerr Institute for New Leaders. The couple has previously donated $15 million to the Rice Center for Engineering Leadership; their newest gift is the largest in the school’s history.

San Francisco attorney Christopher Dolan has agreed to represent a client who says Uber stole his business idea. The evidence is thin, though, and the lawsuit a big gamble for Dolan’s firm, observes The Recorder.

Veterans of Google‘s PR team — including Elliot Schrage,Anne Espiritu, and Rachel Whetstone — now run communications at many of Silicon Valley’s most prominent companies. Forbes takes a looks at what’s become the “farm team for the Valley’s spin machine.”Eric Nuzum, the former vice president of programming for NPR, has joined Amazon-owned Audible.com as it looks to move further into the world of podcasting, reports GeekWire. Nuzum — who developed some of NPR’s biggest shows, including “Wait, Wait, Don’t Tell Me” — is joining as senior vice president of original content.

On Friday, Snapchat CEO Evan Spiegel delivered a commencement address at USC’s Marshall School of Business. Among the many pointers he offered the school’s graduates: “You are going to make a lot of mistakes. I’ve already made a ton of them — some of them very publicly — and it will feel terrible, but it will be okay. Just apologize as quickly as you can and pray for forgiveness.” His full commencement speech is here.

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Jobs

Yale is seeking academically inclined founders and investors to teach entrepreneurship on the faculty at Yale SOM. There are two openings.

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Data

Sales on e-commerce websites increased 3.5 percent in the first three months of the year from the previous quarter, reaching a record $80 billion worth of purchases, according to Commerce Department figures released Friday and covered by Bloomberg. Year over year, online purchases were up 14.5 percent. Somewhat amazingly, the share of e-commerce as a percent of total retail sales is still just 7 percent, up from 0.6 percent in 1999.

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Essential Reads

Axact calls itself Pakistan’s largest software exporter. The New York Times calls it a “fake education empire,” that’s “obscured by proxy Internet services, combative legal tactics and a chronic lack of regulation in Pakistan.”

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Detours

David Letterman, revolutionary.

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Retail Therapy

The Chewbacca hoodie. [Takes helmet by the brim, holds it in the air.]

Uber Exec Tom Fallows on the Company’s Culture, and More