This Week: Fungible, SpaceX-plosion, and a self-inflicted wealth tax
This week, Democratic candidate debates went ahead on Wednesday and Thursday evening. In a crowded field, candidates Bernie Sanders, Kamala Harris and Elizabeth Warren had successful sessions, where previous Vice President Joe Biden faced a barrage of tricky questions from other candidates on his past voting record. Some candidates - Sanders in particular, whose 2016 campaign policies set the agenda for 2020 - firmly support increased taxation on America’s 1% and corporate structure. With all candidates though, affordable medicare is being routinely touted as a priority.
On the other side of the aisle this week, Huawei shuts down its promising solar power business in the US due to the Trump administration’s trade war; India raises tariffs on US goods, prompting Trump’s ire; and US hardware makers - including Intel and Micron - are exploiting a loophole to prevent their chips from being labeled as ‘American Made’, thus allowing them to continue selling to Huawei despite Trump’s ban.
Here are a few of the bigger stories affecting the US economy this week:
SoftBank, hard cash
Fungible, a Santa Clara-based data center technology startup announced on Thursday that it - like many other fledgling US firms - had received a visit from the Fairy Godmother across the Pacific. In May, the Softbank Vision fund distributed over $3.4bn in venture capital to startups - the lion’s share of which went to US startups Cruise and DoorDash.
This month, SoftBank’s number of investments shrank to two, with Fungible receiving $200mn in a Series C round (Brazilian fitness platform Gympass received $300mn in a Series F round two weeks ago).
Seeking to solve a growing problem for technology operators worldwide, Fungible is attempting to pivot data centers from a “compute-centric” model to a data-centric one. The company’s proprietary Data Processing Units (DPU) are being hailed as a new, essential element of data center infrastructure.
"Our vision is to provide such dramatic improvements to the performance, reliability and economics of data centers that applications previously unimaginable become possible," said Pradeep Sindhu, co-founder and CEO of Fungible. "Every significant advancement in technology is ultimately enabled by a step-function improvement in one of its fundamental building blocks; the Fungible DPU is a new essential building block that represents just such a step-function improvement."
Tax us, please!
In 2017, Donald Trump passed a series of tax cuts, 83% of the benefits from which went to the top 1% of earners in the country. However, the top 1% of the US’ earners don’t really need the money: A fact that even the country’s biggest hoarders of wealth have felt the need to point out to the US government.
In an open letter published on Medium, business leaders like George Soros, Abigail Disney, and Facebook co-founder Chris Hughes, made a request to 2020 candidates: tax the wealthy. Tax us.
The proposed tax would affect the richest 0.1% of Americans and, according to the letter, would raise money to fight climate change, boost economic growth, support investments in public health, reduce the wealth gap, strengthen American democracy, and give the ultra wealthy an opportunity to fulfill their ‘patriotic’ duty.
The letter signs off: “Those of us who have signed this letter believe it is our duty to step up and support a wealth tax that taxes us. It is a key to both addressing our climate crisis, and a more competitive, stronger economy that would better serve millions of Americans. It would make America healthier. It is a fair way of creating opportunity. And it strengthens American freedom and democracy. It is not in our interest to advocate for this tax, if our interests are quite narrowly understood. But the wealth tax is in our interest as Americans.
That’s why we’re joining the majority of Americans already supporting a moderate wealth tax. We ask that you recognize its strong merit and popular support, and advance the idea to tax us a little more.”
Ground control to Elon Musk
On Tuesday morning at 2:30am ET, a Falcon Heavy rocket belonging to Elon Musk’s SpaceX startup lifted off from Cape Canaveral, Florida. The night launch was reportedly the ‘most difficult’ so far attempted by the company.
The Falcon Heavy was used to transport 23 satellites, a NASA atomic clock and the ashes of 152 people beyond the upper atmosphere. On reentry, one of the rocket’s boosters reportedly missed its landing pad, exploding in the sea. The other two survived.
In the wake of the launch, Musk has announced that the company will be seeking to raise a further $300mn in venture capital funding over the course of 2019, in order to support its grand aim of transporting 100 passengers to Mars. If successful, SpaceX will have raised $1.33bn this year alone.
Marketing matters: from IBM to Kyndryl
Prior to joining Kyndryl as Chief Marketing Officer, Maria had a 25-year career at IBM, most recently as the tech giant’s CMO where she oversaw all marketing professionals and activities across North America, Canada and Latin America. She has held senior global marketing positions in a variety of disciplines and business units across IBM, most notably strategic initiatives in Smarter Cities and Watson Customer Engagement, as well as leading teams in services, business analytics, and mobile and industry solutions. She is known for her work with teams to leverage data, analytics and cloud technologies to build deeper engagements with customers and partners.
With a passion for marketing, business and people, and a recognized expert in data-driven marketing and brand engagement, Maria talks to Business Chief about her new role, her leadership style and what success means to her.
You've recently moved from IBM to Kyndryl, joining as CMO. Tell us about this exciting new role?
I’m Chief Marketing Officer for Kyndryl, the independent company that will be created following the separation from IBM of its Managed Infrastructure Services business, expected to occur by the end of 2021. My role is to plan, develop, and execute Kyndryl's marketing and advertising initiatives. This includes building a company culture and brand identity on which we base our marketing and advertising strategy.
We have an amazing opportunity ahead at Kyndryl to create a company brand that will stand apart in the market by leading with our people first. Once we are an independent company, each Kyndryl employee will advance the vital systems that power human progress. Our people are devoted, restless, empathetic, and anticipatory – key qualities needed as we build on existing customer relationships and cultivate new ones. Our people are at the heart of this business and I am deeply hopeful and excited for our future.
What experiences have helped prepare you for this new opportunity?
I’ve had a very rich and diverse career history at IBM that has lasted 25+ years. I started out in sales but landed explored opportunities at IBM in different roles, business units, geographies, and functions. Marketing and business are my passions and I landed on Marketing because it allowed me to utilize both my left and right brain, bringing together art and science. In college, I was no tonly a business major, but an art major. I love marketing because I can leverage my extensive knowledge of business, while also being able to think openly and creatively.
The opportunities I was given during my time at IBM and my natural curiosity have led me to the path I’m on now and there’s no better next career step than a once-in-a-lifetime-opportunity to help launch a company. The core of my role at Kyndryl is to create a culture centered on our people and growing up in my career at IBM has allowed me to see first-hand how to prioritize people and ensure they are at the heart of progress in everything Kyndryl will do.
How would you describe your leadership style?
I believe that people aren't your greatest assets, they are your only assets. My platform and background for leadership has always been grounded in authenticity to who I am and centered on diversity and inclusion. I immigrated to the US from Chile when I was 10 years old and so I know the power and beauty that comes from leaning into what makes you different from other people, and that's what I want every person in my marketing organization to feel – the value in bringing their most authentic self to work every day. The way our employees feel when they show up for themselves authentically is how they will also show up for our customers, and strong relationships drive growth.
I think this is especially true in light of a world forever changed by the pandemic. Living through such an unprecedented time has reinforced that we are all humans. We can't lead or care for one another without empathy and I think leaders everywhere have been reminded of this.
What’s the best leadership advice you’ve received?
When I was growing up as an immigrant in North Carolina, I often wanted to be just like everyone else. But my mother always told me: Be unique, be memorable – you have an authentic view and experience of the world that no one else will ever have, so don't try to be anyone else but you.
What does success look like to you?
I think the concept of success is multi-faceted. From a career perspective, being in a job where you're respected and appreciated, and where you can see how your contributions are providing value by motivating your teams to be better – that's success! From a personal perspective, there is no greater accomplishment than investing in the next generation. I love mentoring younger professionals – they are the future. I want my legacy as a leader to include providing value in work culture, but also in leaving a personal impact on the lives of professionals who will carry the workforce forward. Finding a position in life with a job and company that offers me a chance at all of that is what success looks like to me.
What advice would you give to your younger self just starting out in the industry?
I've always been a naturally curious person and it's easy for me to over-commit to projects that pique my interest. I've learned over years of practice how to manage that, so to my younger self I’d say… prioritize the things that are most important, and then become amazing at those things.