Office Hours Podcast: All Voices Allows Employees To Share Feedback Anonymously
Spencer Rascoff
Spencer Rascoff is an entrepreneur and company leader who co-founded Zillow, Hotwire and dot.LA, and who served as Zillow's CEO for a decade. He is currently executive chairman of dot.LA and a board member at Zillow and TripAdvisor. In fall 2019, Spencer was a Visiting Executive Professor at Harvard Business School where he co-taught the "Managing Tech Ventures" course. In 2015, Spencer co-wrote and published his first book, the New York Times' Best Seller "Zillow Talk: Rewriting the Rules of Real Estate." Spencer is the host of "Office Hours," a monthly podcast on dot.LA featuring candid conversations between prominent executives on leadership, diversity and inclusion, and startups.
It can be plain scary to speak up about work issues while on the job.
That's why All Voices came to be. It's a platform that allows employees to anonymously share negative feedback and concerns with company administration. Inspired in the midst of the MeToo awakening, founder and CEO Claire Schmidt says the goal is to give voice to all potential work conflicts, "whether it's a culture issue or something more serious, like harassment or bias or mistreatment. And it's a way to give everyone basically an equal voice in their company."
I love what All Voices is doing. In fact, I'm a seed investor. On this episode of Office Hours, hear Claire share the problems All Voices is trying to solve, how the communication process works — and an early lesson learned that forced All Voices to quickly make a radical pivot.
All Voices founder and CEO Claire Schmidt
Photo by Liam Satre Meloy
Founded in 2017, the Santa Monica-based company has seen usage of its tool double since COVID-19 struck in March, Schmidt says. From June-August, 17 new companies have signed up for the service.
The striking uptick has to do with the strain of working during a pandemic, Schmidt says. It's not easy to have direct conversations. Gone are the "spontaneous chats with people in the kitchen or walking through the office" says Schmidt. In their place, All Voices offers surveys and real-time reporting of employees' sensitive issues.
These days, the issues Schmidt is hearing about similar themes across various companies: challenges that come with working from home, concerns about mask compliance and physical distancing for those at the workplace, worries about job security and ideas for how companies can do more to make their workforces more inclusive.
When it comes to Los Angeles as the company's headquarters, Schmidt says she loves the lower-key vibe than what exists in the Bay Area, access to top-notch talent and a diverse economy.
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Palantir Technologies' stock rose more than 30% after the enigmatic, big data analytics company officially went public with a direct listing on the New York Stock Exchange Wednesday.
The stock under the ticker symbol PLTR ended the day at $9.50 per share or $2.25 above its $7.25 reference price.
<p>Direct listings are less common than IPOs which rely on investment bankers to underwrite an offering, but companies including Slack Technologies and Spotify have moved forward, betting on their broad brand name recognition, and to avoid incurring extra fees. Under the arrangement, employees and other early investors directly sell their shares upon the company's Wall Street debut. </p><p>But, Palantir's direct listing is unique in that it includes a lockup period that prevents employees and legacy investors from selling the stock. Analysts say this provides new shareholders the opportunity to participate in the listing without substantial risk of short-term decline in price.</p><p>Palantir's software offerings, including Gotham and Foundry, are used by 125 customers across more than 150 countries and in 36 industries. It has touted its government work as "central to defense and intelligence operations in the United States and its allies abroad," according to its Securities and Exchange Commission filing.</p><p>Industry analysts expressed concern that the company's overall customer count is low. Palantir Chief Financial Officer David Glazer declined to discuss how many of its clients are government versus enterprise in an interview Wednesday. Though it has increased its focus on the commercial market, Palantir's government portfolio has increased to 54% in the first half of 2020, wrote analyst Rohit Kulkarni, executive director of MKM Partners, in a note.</p><p>Glazer said that due to the company's 17-year history, "there's a real moat" that competitors have to overcome to match their software abilities. Glazer said that the company essentially "turned off our growth machine" to build out Foundry.</p><p>"You're really going to see us be able to scale" to more customers faster and at lower cost," Glazer said. "No one else is going to be able to do that without a huge amount of resources, huge amount of engineering talent against it, and so I think we have a very strong moat."</p><h2>Analysts ask: Does it Scale?
</h2><p>Because many of Palantir's largest and legacy customers are governments, Brendan Burke, a senior emerging tech analyst with PitchBook, said the overall low customer count "suggests that the platform has not scaled rapidly across new customers" and that Palantir "earns a relatively small percentage of its revenue from (those) recently won customers." He added that the company "will be challenged to maintain its expected 2020 revenue growth of 42% year-over-year given its reliance on new government contract wins and the long sales cycle of its data integration platform Foundry."</p><p>In its filings, Palantir estimates its total addressable market to be roughly $119 billion over both commercial and government sectors. And it has provided its software to commercial industries, including energy, transportation, financial services and healthcare. Burke said he found the addressable market in terms of actual end-user spending for data analytics is in the range of $24 billion, multiple times below Palantir's assessment.</p><p>For now, the company remains far from profitable. In its SEC filing, it warned investors that it has "incurred losses each year since its inception" and "may never achieve or maintain profitability."</p><p>While the company reported $742.6 million in revenue in 2019, it saw a loss of $579.6 million. Similarly, in 2018, the company recorded a $580 million loss on $595.4 million revenue. So far, in the first half of 2020, Palantir has reported a $164.7 million loss on $481.2 million in revenue.</p><p>Palantir employs more than 2,390 people globally, said it's in the process of entering new and emerging markets, including its newer foray into COVID-19 response efforts as well as defense, law enforcement, national security, and government agencies.</p><p>As of the first half of 2020, it reported its total remaining deal value of contracts awarded by government agencies was $1.2 billion.</p><p>Formerly based in Palo Alto, Calif., Palantir co-founder and chief executive Alexander Karp wrote a scathing rejection of Silicon Valley culture in his introduction to the company's S-1 filing, and the company moved its headquarters to Denver, Colorado this summer. </p><p>Founded in 2003, Palantir has always been accused of secrecy because of its government-related work, but it does have legit U.S. intelligence roots. The company's only early outside investment came from the Central Intelligence Agency's venture capital arm, In-Q-Tel, which helped develop its software to analyze reams of siloed data. Their tech was particularly well-suited to intelligence agency uses and has been primarily used for counterterrorism as well as law enforcement since its early days. Today it's used by the U.S. military, including the U.S. Special Operations Command, the Centers for Disease Control, the Department of Homeland Security and Securities and Exchange Commission, among others.</p><p>The use of its software by DHS has led to accusations that its software is being used by ICE to help it find and deport immigrants under the Trump administration. And the company has seen activists protest outside of its now former Palo Alto offices as a result. Co-founder and billionaire investor Peter Thiel is a prominent supporter of President Donald Trump.</p><p>Glazer said "the problem set that our software is deployed against is complex, it's nuanced, and we welcome the internal discussion." He added that "transparency is a great thing for the company" and that by going public "we'll be able to share more over time about our customers" though that will be more difficult for customers in the intelligence and government sector.</p><p>Kulkarni, the executive director of MKM Partners, wrote that "Palantir's products look extremely robust and truly 'battle tested'" — its software can be installed on a submarine and a tablet with no internet connectivity, for example — but that it is still early days with direct sales.</p><p>In addition to lack of profitability, investment risks include the company's many shareholders — and likely sellers once the lockup period ends after the company announces fourth quarter earnings. Its top three customers make up 33% of its revenue in 2018 and in 2019, those customers made up 28% and had been with the company on average for eight years.</p><p>Kulkarni criticized Palantir for providing a "very limited disclosure" even though it has more than 15 years of operating history.</p><p>"We found Palantir's S-1 filing fairly light on customer trends, SaaS metrics," Kulkarni wrote. "Also, the company has disclosed only six trailing quarters worth of financials and has not provided any guidance."</p><p>Still, Kulkarni wrote that he expected significant investor appetite given the company's "enigmatic" history and ongoing IPO pricing trends. He added that the company would trade at a slight discount to its relative growth rate, given its customer concentration, unclear visibility and customer size.<span></span></p>
<p>Such efforts are "the exception but not that rare," and he noted that the Ford family set up a similar structure to ensure their control of Ford Motor company as did Comcast. The variable structure allows the founders to control up to 49.999999% of the total voting power of the stock.<br/></p><p>Burke, a senior emerging tech analyst with PitchBook, said that while it's common for founder-led startups to remain controlled by the founder, Palantir has further pushed the envelope with this new share class structure.</p><p>"The broader impact is limiting the ability of shareholders to influence the company's strategy," Burke said. "This share class structure prevents common shareholders from making activist decisions for the company's future."</p><p>Kulkarni wrote that the structure gives the company's three founders "unilateral voting control over the company in perpetuity."</p><p>Burke said this is a continuing trend in the market, especially because there hasn't been significant pushback from investors.</p><p>Other concerns include worries about the "growing ethical orientation of investors" that could lead to backlash over Palantir's involvement with government agencies "shown to violate human rights," Burke said. "We haven't seen the company adapt to these concerns yet."</p><p>Perhaps to assuage this concern, Palantir pointed to its privacy and civil liberties safeguards, its focus on supporting "Western liberal democracy and its strategic allies" and it also took a stand on the Chinese Communist Party, assuring investors perhaps wary of another ByteDance Ltd.-related debacle that it doesn't work with the party or host its platforms in China because it is "inconsistent with our culture and mission."</p><p><em>*Editor's Note: Spencer Rascoff, the executive chairman and cofounder of dot.LA and Zillow, has been a member of Palantir's board of directors since July 2020 and is also an investor in the company.</em></p><p>___</p><p><em>Do you have a story that needs to be told? My DMs are open on </em><a href="https://twitter.com/latams" target="_blank"><em>Twitter @latams</em></a><em>. You can also email me at tami(at)dot.la, or ask for my Signal.</em></p>
Palantir's Unconventional Voting Structure
<img lazy-loadable="true" src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNDQ1MTQyOC9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTYzNjQxODYzMX0.Hyi0HYB_4Uq1Knn1ZPZ7YRlUvy-jXxtNtEPirbw8WCI/img.png?width=980" id="29110" class="rm-shortcode" data-rm-shortcode-id="50a1e07f92e7f750629d4e2456763bb1" data-rm-shortcode-name="rebelmouse-image" />'Transparency is a Great Thing': Secretive Big Data Firm Palantir Goes Public<p>The company's voting and governance structure has given many industry analysts pause. Michael Weisbach, the Ralph W. Kurtz finance chair at Ohio State University's Fisher College of Business, said it creates an extra class of stock that gives founders effective control of the company no matter how much stock they actually own.</p>
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Musicians are facing a tough road and the pandemic hasn't made life any easier. But changes are afoot that could help.
A flurry of deals between music copyright owners and a grab bag of online video purveyors may be just the first step in a process that could see "the most important copyright reform since the U.S. passed the Digital Millennium Copyright Act (DMCA) 22 years ago," according to one industry observer.
With it, artists and rights holders should be better positioned to benefit from the growing relevance of music across social media platforms, gaming consoles, virtual gyms and much more.
<p>"There clearly has been a frenzy of activity," David Israelite, president and chief executive of the National Music Publishers' Association (NMPA), a trade association representing American music publishers and songwriters, told dot.LA. </p><p>The changes afoot stem from a battle that has been playing out in Europe that has pitted the creative community against some of tech's giants such as YouTube and Facebook. Those companies depend on content created by artists. </p><p>Last year, the EU adopted tough new copyright laws set to take effect by next June. Though the regulations are facing a slew of challenges, global digital companies are looking to come into compliance to get ahead of the curve, and possibly gain an edge over competitors. </p><p>In August, Santa Monica-based Snap <a href="https://www.bloomberg.com/news/articles/2020-08-03/snap-lands-deals-with-top-music-companies-to-add-songs-to-videos?sref=QjdS4d5U" rel="noopener noreferrer" target="_blank">struck a deal</a> with several big music companies for rights to their music. L.A.-based Triller <a href="https://musically.com/2020/08/13/triller-signs-new-18-month-contract-with-b2b-firm-7digital/" rel="noopener noreferrer" target="_blank">signed a deal</a> with digital music firm 7digital for back-end support on its licensing management. </p><p>In July, <a href="https://musically.com/2020/07/23/tiktok-licensing-us-publishing-nmpa/" rel="noopener noreferrer" target="_blank">TikTok agreed to terms with NMPA</a>, which included a settlement for past violations and an agreement for the future. The Culver City-based company also recently signed deals with indie digital rights managers <a href="https://www.musicbusinessworldwide.com/tiktok-signs-global-licensing-deal-with-indie-label-agency-merlin/" rel="noopener noreferrer" target="_blank">Merlin</a> and <a href="https://www.musicbusinessworldwide.com/tiktok-inks-new-global-deal-with-believe-one-of-the-worlds-biggest-independent-music-companies/" rel="noopener noreferrer" target="_blank">Believe</a>. </p><p>The Believe agreement could be particularly beneficial. It allows the independent artists affiliated with Believe-owned TuneCore to upload tracks onto TikTok, <a href="https://www.musicbusinessworldwide.com/tunecore-offers-free-distribution-to-tiktok/" rel="noopener noreferrer" target="_blank">the company announced last week</a>, potentially bringing them a massive new global audience. </p><p>And in-home fitness, much of which relies on music, is becoming more popular. Apple, for instance, <a href="https://www.apple.com/newsroom/2020/09/apple-fitness-plus-a-personalized-fitness-experience-comes-to-life-with-apple-watch/" rel="noopener noreferrer" target="_blank">recently announced a new subscription fitness program</a> that will involve music. </p><p>The company is "doing it the right way – licensing from the very start," Israelite said. NMPA will undoubtedly be watching other competitors in the fitness space closely.</p><p class="shortcode-media shortcode-media-rebelmouse-image">
<a href="https://images.unsplash.com/photo-1594810205183-18a8b0ce6c13?ixlib=rb-1.2.1&q=80&fm=jpg&crop=entropy&cs=tinysrgb&w=400&fit=max&ixid=eyJhcHBfaWQiOjEzMzIxMn0" target="_blank"><img type="lazy-image" data-runner-src="https://dot.la/media-library/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNDQ0MjY2NC9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYxMjA0MTMyNH0.u9Jw-CUCzI1EEbsUATH9Zlc7u-6jeSKd47QHOKyofjg/image.jpg?width=980" id="57a2e" class="rm-shortcode" data-rm-shortcode-id="4c78ff84a9cd9b9c9061bfb94b7aefd0" data-rm-shortcode-name="rebelmouse-image" /></a>
<small class="image-media media-caption" placeholder="Add Photo Caption..."> European Union member countries will begin enforcing Article 17 by June 2021 that require platforms to make an upfront effort to avoid copyright violation. </small>
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Photo by <a href="https://unsplash.com/@guillaumeperigois?utm_source=RebelMouse&utm_medium=referral">Guillaume Périgois</a> on <a href="https://unsplash.com/?utm_source=RebelMouse&utm_medium=referral">Unsplash</a>
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</p><h2>Why Are All These Deals Happening Now?</h2><p>In the U.S., the current legal framework – which emerged with the DMCA, before social media existed – requires platforms to respond to takedown notices, but not to proactively ensure that songs that show up in user feeds are properly licensed. </p><p>When a song's rights holder issues a takedown notice, it leaves the platform with the choice of obtaining a license, removing the song from the platform (and potentially upsetting users) or possibly getting sued. </p><p>Songs have two kinds of copyright: one for the sound recording, and one for the underlying composition. If a platform is making money in part thanks to a song, both copyrights are relevant. </p><p>Since the performer is the face of the music, the songwriter can sometimes be forgotten. </p><p>"You often see (platforms) start with labels then move on to publishers. Sometimes they won't, though, or sometimes they won't get to the smaller, independent publishers," Israelite added. </p><p>Platforms can also take "Safe Harbor," meaning "what they don't know is on their platform, they're not liable for," said Wilson Hays of L.A.-based <a href="https://pex.com/" target="_blank">Pex</a>, a tech company that monitors audio and visual assets across the web. But by June of next year, <a href="https://www.termsfeed.com/blog/eu-copyright-directive-article-17/" rel="noopener noreferrer" target="_blank">the EU will begin enforcing</a> reforms that require platforms to make an upfront effort to avoid copyright violation. The new E.U. laws won't apply directly to content posted in the U.S., but companies with international operations may find it easier to roll out compliance changes across their global operations rather than taking a piecemeal approach. </p><p>Hays believes that many are already trying to get ahead of Article 17's requirements before the new legislation takes effect. It may behoove them to do so, since <a href="https://www.ipwatchdog.com/2020/06/02/senate-ip-subcommittee-hearing-dmca-reform-grand-bargain-no-longer-working/id=122124/" rel="noopener noreferrer" target="_blank">the U.S. is looking at its own copyright reforms</a>. </p><p>This is a big deal, Hays said. </p><p>"Life will get better come 2021 for independent rights holders because they will have tools at their disposal that will allow them to have more control over their content — on top of generating more revenue," he added. "This attribution will happen prior to upload, allowing any creator to participate in whatever revenue is generated from the get-go."</p><p>Indian social media companies, too, are facing a tougher regime of music copyright enforcement. Several short-form video companies that have gained popularity in the wake of TikTok's ban in the country, including Triller, are <a href="https://musically.com/2020/09/08/t-series-takes-on-indian-short-video-apps-over-music-usage/" rel="noopener noreferrer" target="_blank">facing lawsuits</a>.</p><p class="shortcode-media shortcode-media-rebelmouse-image image-crop-16x9">
<a href="https://images.unsplash.com/photo-1527334919515-b8dee906a34b?ixlib=rb-1.2.1&q=80&fm=jpg&crop=entropy&cs=tinysrgb&w=400&fit=max&ixid=eyJhcHBfaWQiOjEzMzIxMn0" target="_blank"><img type="lazy-image" data-runner-src="https://dot.la/media-library/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNDQ0MjY2NS9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYzNjQzMDU5NX0.vDamg-65AmkrOVrmYwlAZ8S7Bs8xOEo-6WK7OEk3O2k/image.jpg?width=1245&coordinates=200%2C726%2C274%2C80&height=700" id="fc235" class="rm-shortcode" data-rm-shortcode-id="9c457d1c550e785bd9f69581160fa173" data-rm-shortcode-name="rebelmouse-image" /></a>
<small class="image-media media-caption" placeholder="Add Photo Caption...">Amazon-owned streaming video company Twitch also relies heavily on music.</small>
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Photo by <a href="https://unsplash.com/@casparrubin?utm_source=RebelMouse&utm_medium=referral">Caspar Camille Rubin</a> on <a href="https://unsplash.com/?utm_source=RebelMouse&utm_medium=referral">Unsplash</a>
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</p><h2>Music Has Become a Core Component of Social Media
</h2><p>On YouTube, for example, there are at least 10 seconds of music on 84% of the platform's videos, and over half of all videos on Instagram contain music, according to Hays. Getting their licenses in order allows platforms to let their users include music in their videos without needing to worry they will be taken down.</p><p>Amazon-owned streaming video company Twitch also relies heavily on music. <a href="https://www.billboard.com/articles/business/9431760/jeff-bezos-twitch-music-royalties-artist-rights-alliance-letter" rel="noopener noreferrer" target="_blank">The company has taken heat</a> for Jeff Bezos' <a href="https://www.billboard.com/articles/business/9429423/jeff-bezos-stumped-twitch-royalties-congressional-hearing" rel="noopener noreferrer" target="_blank">poor performance before Congress in July, when representatives asked him</a> if the company pays out royalties. He couldn't say, but the answer is… rarely. </p><p>Platforms that delay getting their licensing deals in order can save themselves cash. They can also avoid navigating the complex copyright landscape. But as they grow, that strategy can come back to bite them. </p><p>"Once they begin generating substantial revenue, then they'll draw the attention of rights holders," said Hays.</p><p>At least part of the change has to do with a growing intolerance by the creative community of extremely wealthy companies using their music without proper licensing. Another driver is the successful, high-profile legal disputes that Israelite said have "sent a message to other companies." </p><p>Peloton, for example, faced a protracted legal battle before <a href="https://www.prnewswire.com/news-releases/nmpa-and-peloton-announce-settlement-of-litigation-joint-collaboration-agreement-301012233.html" rel="noopener noreferrer" target="_blank">agreeing to terms</a> that, as with TikTok, accounted for past violations and set new terms for artists featured on its platform. Such cases, Israelite noted, have "accelerated the choice these companies have to make": Either license properly, or be a copyright infringer, and bear the consequences of receiving takedown notices or getting sued. </p><p>In the wake of Jeff Bezos's embarrassing admission to Congress, Twitch is "starting to become more of a focus for the need for proper licenses," said Israelite. </p><p>As has already been seen in India, TikTok competitors in the short-form video space can't just focus on having the right algorithm and attracting a big user base. Israelite pointed to Triller as an example of a startup that has deals with record labels (for the recordings) and some publishing deals but may soon have to play catch up. </p><p>"I think they'll have to deal with a pretty large problem for a significant number of songs being used without proper permission from publishers." </p><p>Israelite also noted that Twitter has no publishing licenses yet. </p><p>More ripples are likely to emerge wherever music can be found in the digital landscape, from social media to gaming, fitness and beyond. Whether that change comes in the form of lawsuits or licensing agreements remains to be seen. </p>
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