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Weekend Briefing No. 270
Welcome to the weekend. Thanks for everyone that came out to the event on Thursday night, we had a full house and a great conversation about race in America. If you missed it, here’s the presentation.
6.6 MM – Intuit and H&R Block spent a combined $6.6 million last year lobbying congress to advance the tax prep industry’s long-held goal of barring the IRS from creating a free electronic tax filing system.
20,000 – Your organic cotton tote bag is pretty much the worst replacement for single-use plastic bags. Organic cotton bags have to be reused 20,000 times have same cumulative environmental impact (water use, energy use, etc.) as a classic plastic bag.
34.8 – According a recent study Tesla drivers use Autopilot for 34.8% of their driven miles, and yet appear to maintain a relatively high degree of functional vigilance.
State of Social Entrepreneurship
One of my favorite reports every year is the Echoing Green State of Social Entrepreneurship report because it’s probably the most comprehensive view of early stage social enterprise. In the 2019 application cycle, Echoing Green received 2,574 applications—a 6.4 percent increase from last year—representing 3,006 individuals operating in 161 countries across the world. Let’s talk about bias in funding. 51% of applicants had received no funding, 33% had raised up to $100,000, 16% had raised $100,000 or more. The median funds raised by black applicants is $0, compared to $12,245 of their white counterparts. When funds have been raised, organizations led by African, African-American, or black applicants report median funding $25,000 lower than their Caucasian, European, or white counterparts. Along gender lines, Caucasian, European, and white female applicants have a median funds raised $25,000 less than their male counterparts—though the effects of race and ethnicity on funding are evident, as well, with African, African-American, and black women applicants raising a median $47,400 less than Caucasian, European, and white men. In the United States alone, the disparities in funding that these social entrepreneurs report individually add up to a $20 million funding gap: the 492 organizations led by black applicants raised $40 million overall, compared to $61 million raised by the 396 organizations led by white applicants. Echoing Green (15 minutes)
How come at a start-up you can participate in the equity upside? But at a charity, you’re helping all these people, and you can’t participate in the monetary upside? That is a quandy that my friends at charity: water are trying do something about it. Under a new program, start-up founders will be able to share their wealth not just with impoverished families in the developing world but also with a rather more comfortable demographic — charity: water employees. Here’s how it works: Entrepreneurs who own sizable stakes in private companies can donate some of their equity to Charity: water. When their company goes public or is sold, some of the proceeds will be paid out as bonuses to staff, which charity: water is calling The Pool. That all but guarantees that the organization’s 78 employees will share in the spoils from some of the most hotly anticipated initial public offerings in the history of Wall Street. New York Times (11 minutes)
Startup Stock Options
Much has changed about the economics of startups in the last two decades, but the employee equity scheme hasn’t. Are stock options still a good deal for early employees of startups? There are four problems: 1) As the company raises more money, the value of your initial stock option grant gets diluted by the new money in. So, while the VCs gain the upside from keeping a startup private, employees get the downside. 2) When IPO’s no longer happen within the near-time horizon of an employee’s tenure, the original rationale of stock options has disappeared. Now there’s little financial reason to stay longer than the initial grant vesting. 3) As the fair market value of the stock rises (to what the growth investors are paying), the high exercise price isn’t attractive for hiring new employees. 4) In many high-valued startups, today’s founders get to sell parts of their vested shares at each round of funding, but this isn’t usually the case for employees with stock options. Harvard Business Review (13 minutes)
We’re all familiar with solid, liquid and gas. Now, a team has used a type of artificial intelligence to confirm the existence of a bizarre new state of matter, one in which potassium atoms exhibit properties of both a solid and a liquid at the same time. Between about 20,000 and 40,000 times atmospheric pressure and 400 to 800 Kelvin (260 to 980 degrees Fahrenheit), the potassium entered what’s called a chain-melted state, in which the chains dissolved into liquid while the remaining potassium crystals stayed solid. This is the first time scientists have shown that such a state is thermodynamically stable for any element. If you were somehow able to pull out a chunk of such material, it would probably look like a solid block leaking molten potassium that eventually all dissolved away. It would be like holding a sponge filled with water that starts dripping out, except the sponge is also made of water. National Geographic (6 minutes)
Seeing the Unseeable
A picture of a black hole is one of those great, self-negating concepts, like the sound of silence, the presence of absence or the lives of the dead. The nature of one refutes the other. But a picture of a black hole has arrived nonetheless. What the picture reveals is the black hole’s so-called event horizon, the swirl of gas and dust and stars and light itself, circling the gravitational drain, before they’re sucked inside never, ever to reemerge. The black hole at the center of our galaxy goes by the name Sagittarius A*. It has a mass equivalent to about 4.1 million of our suns. While that earns it the sobriquet “supermassive black hole”. It measures perhaps 24 million miles across, or about a 50 billionth the size of the galaxy. Trying to take an image of that from the 26,000 light year distance at which the Earth sits from the center of the Milky Way is like trying to spot an orange on the surface of the moon—with the naked eye. TIME (5 minutes)
Save the Amazon
This week, more than 4,200 Amazon employees called on the company to rethink how it addresses and contributes to a warming planet. The action is the largest employee-driven movement on climate change to take place in the influential tech industry. The workers say the company needs to make firm commitments to reduce its carbon footprint across its vast operations, not make piecemeal or vague announcements. And they say that Amazon should stop offering custom cloud-computing services that help the oil and gas industry find and extract more fossil fuels. The goal for Amazon’s leaders and employees is that climate change is something they think about whenever a business decision is being made. New York Times (7 minutes)
The poet, essayist, and playwright Claudia Rankine says every conversation about race doesn’t need to be about racism. But she says all of us — and especially white people — need to find a way to talk about it, even when it gets uncomfortable. Her bestselling book, Citizen: An American Lyric, catalogued the painful daily experiences of lived racism for people of color. Claudia models how it’s possible to bring that reality into the open — not to fight, but to draw closer. And she shows how we can do this with everyone, from our intimate friends to strangers on airplanes. In this interview I hear echoes of W.E.B. Du Bois, who wrote of similar experiences of feeling “othered” over a century ago in his book The Souls of Black Folk… which is conveniently on the bookshelf this week. On Being (51 minutes)
The Souls of Black Folk by W.E.B. Du Bois. This landmark book is a founding work in the literature of black protest. W. E. B. Du Bois (1868–1963) played a key role in developing the strategy and program that dominated early 20th-century black protest in America. In this collection of essays, first published together in 1903, he eloquently affirms that it is beneath the dignity of a human being to beg for those rights that belong inherently to all mankind. He also charges that the strategy of accommodation to white supremacy advanced by Booker T. Washington, then the most influential black leader in America, would only serve to perpetuate black oppression. Publication of The Souls of Black Folk was a dramatic event that helped to polarize black leaders into two groups: the more conservative followers of Washington and the more radical supporters of aggressive protest. Its influence cannot be overstated. It is essential reading for everyone interested in African-American history and the struggle for civil rights in America. Amazon
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I love language because when it succeeds, for me, it doesn't just tell me something. It enacts something. It creates something. And it goes both ways. Sometimes it's violent. Sometimes it hurts you. And sometimes it saves you. – Claudia Rankine