Hello Monday’s experts
Here’s some of what’s going down.
1. Wirecard’s missing billions
German payment processor and financial services provider Wirecard AG may or may not be missing €1.9 billion (A$3.1bn) in a bank somewhere in Asia, but that doesn’t really matter, because investors have already wiped more than €6 billion in value from the scandal-plagued fintech (which was value at €24bn just two years ago).
The hunt for the money amid fraud claims has been underway for several months, with the Financial Times first raising questions about the DAX-listed venture in February 2019,. The company’s auditors, EY said no to signing off on the Wirecard account because it couldn’t confirm the funds existed, amid a six-month investigation by KPMG that said it didn’t find any incriminating evidence of balance sheet manipulation.
But Wirecard’s money couldn’t be found and CEO Markus Braun claimed late last week that the company might be a victim of fraud before he promptly resigned on Friday, with the two Philippine banks supposedly holding the $3bn in trust said they’d never had it.
Today Wirecard’s board said that “on the basis of further examination that there is a prevailing likelihood that the bank trust account balances in the amount of 1.9 billion EUR do not exist”.
The money was supposed to be for risk management.
Considered one of Europe’s fintech stars, Wirecard’s share price has plunged 75% and the company has withdrawn its 2019 and Q1 2020 results plus forecasts
The company has withdrawn its results for 2019 and the first quarter of 2020, as well as its financial forecasts. It’s now in crisis talks with its bankers and is looking at “restructuring, disposal or termination of business units and products segments.”
2. Google Founder Sergey Brin’s GSD
After Hurricane Dorian hit the Bahamas last year, a US disaster assistance response team arrived onboard a high-speed super-yacht to help with urgent medical relief and clearing the wreckage. As a childhood fan of Gerry Anderson’s Thunderbirds, we loved the sound of this and The Daily Beast has the incredible story of how it all came about – Google co-founder Sergey Brin has put together a secretive disaster charity called Global Support and Development (GSD), run by Brin’s former bodyguards and stacked with ex military.
“For the past five years, GSD has been quietly using high-tech systems to rapidly deliver humanitarian assistance during high-profile disasters, including the COVID-19 pandemic. These range from drones and super-yachts to a gigantic new airship that the outfit apparently hopes will make it easier to get aid supplies into disaster zones,” The Daily Beast story says.
We liked Atlassian co-founder Mike Cannon-Brookes’ take on it all, noting that GSD also stands for “Get Shit Done”.
Read all about it here.
3. Victoria’s digital economy minister
Amid dealing with an increase in covid-19 cases, and some old-school faceless ministers in the ALP, Victorian Premier Daniel Andrews also found time to announce his new ministry today in the wake of few following the branch-stacking revelations on 60 Minutes last week.
And there was good news for the tech sector. Along with being small business and employment minister, Jaala Pulford takes up a new role overseeing innovation and the digital economy.
“Highlighting the importance of research and discovery to our economic recovery, she will also serve as Minister for Innovation, Medical Research and the Digital Economy, ” Andrews said announcing Pulford’s appointment
Innovation, the digital economy and medical research are our future, no matter what we do or where we live; the creativity and ingenuity of these sectors is central to Victoria’s future prosperity.
— Jaala Pulford MP (@JaalaPulford) June 22, 2020
4. ACCC’s Fitbit worries
Australia’s competition watchdog is worried about Google’s proposed acquisition of Fitbit, with chair Rod Sims arguing the tech giant’s access to consumer health data may raise entry barriers, further entrench its dominant position and adversely affect competition in several digital advertising and health markets.
“The ACCC’s Digital Platforms Inquiry found that Google’s substantial market power is built on its concentration of search and location data, and data collected via third-party websites and apps,” he said.
“Past acquisitions by Google, of both startups and mature companies like Fitbit, have further entrenched Google’s position. The access to user data available to Google has made it so valuable to advertisers that it faces only limited competition.”
The ACCC has astatement of issues that also ponders whether Google is likely to favour its own wearables devices over competitors’ when supplying important related services such as WearOS, Google Maps, Google Play Store or Android smartphone interoperability.
“This is a rapidly evolving sector and, while there is inherent uncertainty about how digital markets will develop, it does not mean as a competition regulator we can conclude there will be no lessening of competition simply because the future is unclear,” Mr Sims said.
“Our position is where there is uncertainty, especially surrounding such important markets, the ACCC must thoroughly investigate the potential for an acquisition to stymie future competition. As a competition regulator it is our job to weigh carefully the potential issues concerning data and advertising that may follow transactions such as these.”
“We will work very closely with other competition authorities in other jurisdictions that are also reviewing this transaction.”
Feedback on the ACCC’s statement of issues is due by July 10, with a final decision due on August 13.
5. WeWork Labs moves online
A year on from launching in Australian, WeWork’s equity-free Labs program has gone virtual, having welcomed 28 members through its doors in Sydney and Melbourne. The programming on the member portal was quickly dialled up virtually when COVID-19 hit, giving founders access to a professional support network and connection without restriction and globally Labs has hosted more than 500 virtual events, 60 webinars and five mental health awareness events, which can be accessed by anyone globally as part of the program.
Sydney WeWork Labs Manager Monica Wulff said: “As startups continue to navigate through uncharted territories, being able to access valuable resources like mentors and training from a global community like ours can make all the difference.”
Learn more at wework.com/labs
BONUS ITEM: Jobs on jobs
It’s nearly nine years since Steve Jobs stood before the Apple team for the last time to talk about what the company was up to, but we thought of the late humanities student drop out last week when the Australian government announced it planned to more than double the cost of an arts degree in a move only Martin Shkreli could applaud. It was all about jobs, education minister Dan Tehan said, with also cutting funding for maths and engineering and hoping no-one would notice.
“Technology alone is not enough. It’s technology married with the liberal arts… with humanities… that makes the heart sing,” Jobs said in 2011.
We’ll leave this here.