Coronavirus Updates: Jack Dorsey Donates $10M to Sean Penn COVID Fund; Cord Cutting Hits Peak; L.A.'s Reopening

Coronavirus Updates: Jack Dorsey Donates $10M to Sean Penn COVID Fund; Cord Cutting Hits Peak; L.A.'s Reopening

Here are the latest headlines regarding how the novel coronavirus is impacting the Los Angeles startup and tech communities. Sign up for our newsletter and follow dot.LA on Twitter for the latest updates.

  • Twitter CEO Jack Dorsey donates $10 million to COVID-19 fund launched by Sean Penn
  • Americans slash costs with record unemployment, chief among them cutting the cord
  • L.A. County retailers open doors; as people head to trails and golf course this weekend

    L.A. County retailers open doors; as people head to trails and golf course this weekend

    Retailers across the region opened up their doors for the first time in weeks on Friday as Los Angeles County readied to open up trails, golf courses and parks over the weekend. Traffic trickled into downtown early in the morning after weeks of empty streets as Gov. Gavin Newsom eased stay-at-home orders. Retailers including clothing, toy, book and music stores can now operate with curbside services and with Mother's Day around the corner, the city's downtown flower district pulled in brisk business not seen for weeks.

    "I am already feeling a renewed sense of hope and excitement," said county Supervisor Kathryn Barger during a mid-day briefing. The first phase of easing stay at home orders came as the Los Angeles County's public health department logged 883 new cases and 51 deaths. So far, 30,296 people in the county have tested positive and 1,468 have died.

    And the region is far from returning to normal. On Friday, Gov. Gavin Newsom signed an executive order to send every registered voter in California a mail-in ballot for the November presidential election. Although the election is not set to be a vote-by-mail only, those that want to vote in-person can. Guidelines on how in-person voting will work have yet to be hammered out.

    Dining establishments remained pickup or delivery only.

    Twitter CEO Jack Dorsey donates $10 million to COVID-19 fund launched by Sean Penn

    Sean Penn is co-founder of CORE

    live.staticflickr.com

    Twitter Chief Executive Jack Dorsey donated $10 million to the Community Organized Relief Effort (CORE), the non-profit disaster relief group co-founded by actor Sean Penn a decade ago to provide relief to hurricane-ravaged Haiti. The donation came via Dorsey's Start Small initiative, which is bankrolling more COVID-19 testing across the U.S. and Navajo Nation. CORE stated it has set up a dozen COVID-19 test sites across California over the past five weeks and completed 100,000 tests for free through its partnerships.

    "CORE is an inspiring force for good. Not only in what they're doing by increasing our testing capacity, but also by how they're doing it," Dorsey said in a statement. "The open-source approach and work to be a model for others is exactly what this country and world needs right now." Co-founded by CORE CEO Ann Lee, the nonprofit's testing sites have launched in Atlanta, Detroit and will soon serve New Orleans and the Navajo Nation, focused on serving underserved communities, as well as first responders and essential workers, the nonprofit stated.

    Americans slash costs with record unemployment, chief among them cutting the cord

    live.staticflickr.com

    With unemployment on the rise due to the economic fallout of COVID-19, American consumers are slashing costs -- and that starts with cutting the cord. The pandemic has led to a new quarterly record when it comes to pay-TV subscriber losses, according to research firm MoffettNathanson in a report released Friday.

    "In the context of over 30 million unemployment claims and estimates for minus 40 percent gross domestic product, it would be unseemly to resort to hyperbole to describe the carnage in pay TV in the first quarter," analysts Craig Moffett and Michael Nathanson wrote in the report. "Better that we simply report the numbers. Traditional pay TV subscriptions fell by a record 1.8 million in the first quarter, the worst quarterly result on record, bringing the annual rate of decline to 7.6 percent, also a record."

    What's worse, the numbers are expected to drop off steadily in the coming months as sports programming is likely to all but vanish from television screens. Professional and college sports have been sidelined with most states not allowing stadiums full of fans, and leagues considering teams playing in front of empty seats. The report said the "tsunami of unemployment just beginning to hit as the quarter ended, all these numbers will get worse in the second quarter." The U.S. Department of Labor reported earlier in the day that unemployment is now at a record since being tracked in 1948, with payrolls plunging 20.5 million due to the pandemic.

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    🎬 Paramount and Skydance Are Back On
    Image Source: Paramount

    Happy Friday Los Angeles! Hope you all had a fantastic Fourth!!

    🔦 Spotlight

    Paramount and Skydance Media have rekindled talks to merge after negotiations abruptly halted in June. The proposed deal, contingent on approval from Paramount’s board, aims to combine Paramount’s extensive media holdings—including CBS, MTV, and Nickelodeon—with Skydance’s film expertise showcased in hits like "Top Gun: Maverick." This merger signals a potential transformation in the media landscape, positioning the new entity to compete more effectively amid challenges from streaming services and the decline of traditional cable TV.

    Led by Shari Redstone, Paramount’s controlling shareholder via National Amusements, the deal represents a pivot towards revitalizing Paramount’s strategic direction amidst financial struggles and shareholder concerns. The involvement of major investors like RedBird Capital Partners and David Ellison underscores the financial backing aimed at stabilizing Paramount’s operations and addressing its $14 billion debt burden. Importantly, the agreement includes provisions to protect National Amusements from potential legal challenges, addressing previous hurdles that stalled earlier negotiations.

    The deal also includes a 45-day period for Paramount to explore alternative offers, highlighting continued interest from other potential buyers like Barry Diller’s IAC and media executive Edgar Bronfman Jr. This flurry of activity underscores the significant stakeholders’ interest in Paramount’s future and its potential as a key player in a rapidly evolving media industry.


    🤝 Venture Deals

    LA Companies

    • Sidecar Health, a startup that offers personalized health insurance plans to businesses that allow members to see any doctor and pay directly at the time of service, raised a $165M Series D led by Koch Disruptive Technologies. - learn more

    LA Venture Funds


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    😊🚘 Rivian's $5 Billion Lifeline

    🔦 Spotlight

    Volkswagen announced on Tuesday a significant investment of up to $5 billion in Rivian, a struggling electric truck manufacturer known for its vehicles' distinctive smiley-face design reminiscent of Volkswagen's iconic Beetle. This partnership marks a unique collaboration between the world's second-largest automaker and a startup grappling with profitability challenges akin to those faced by Tesla. Volkswagen's infusion of $1 billion initially, potentially rising to $5 billion pending regulatory approval, underscores its strategic pivot towards enhancing its electric vehicle (EV) software capabilities, an area where analysts believe the company has lagged.

    For Rivian, which has received acclaim for its electric trucks and SUVs but struggles with production ramp-up and financial losses, the investment offers crucial financial backing. The company plans to utilize Volkswagen's expertise in manufacturing, leveraging the German automaker's annual production of nearly 10 million vehicles. This alliance aims to bolster Rivian's efforts to launch new models like the R2 midsize SUV and complete its Georgia factory, paused earlier this year to conserve funds. Rivian's stock surged upwards of 40% following the announcement, reflecting investor optimism in the company's future prospects.

    Despite their differing corporate cultures—Volkswagen's traditional, structured approach contrasted with Rivian's agile tech startup ethos—the CEOs of both companies expressed mutual admiration and shared goals during the partnership announcement. The collaboration is expected to yield EV software solutions benefiting Volkswagen's various brands, potentially including Audi and Porsche, while allowing Rivian to maintain its brand identity and separate vehicle marketing strategies. This strategic partnership between Volkswagen and Rivian not only promises to revolutionize the electric vehicle market but also highlights the potential for collaboration between established automakers and innovative startups in Southern California, where Rivian is based. Here’s to hoping these smiling cars will balance out some of the inevitable LA road rage.

    🤝 Venture Deals

    LA Companies

    • HeyGen, a startup that allows users to generate videos with AI-created avatars that can lip-sync to provided audio, making it easier for businesses to create engaging video content, raised a $60M Funding Round at a $500M post-money valuation. The deal was led by Benchmark, with Conviction, Thrive Capital, and Bond Capital also stepping up. - learn more
    • Pomerium, a startup that provides a secure access platform that dynamically verifies user identities to ensure authorized access to applications and services, raised a $13.8M Series A round led by Benchmark and including previous investors Bain Capital, Haystack, and SNR. - learn more
    • Etched, a maker of transformer-specialized AI chips, raised a $120M Funding Round. - learn more
    • Rocketlane, a customer onboarding platform, raised a $24M Series B co-led by 8VC, Matrix Partners India, and Nexus Venture Partners. - learn more
    • Sift, a developer of unified observability solutions for hardware sensor data, raised a $17.5M Series A led by GV. - learn more
    • LOST iN, a travel media brand, raised a $4M Seed Round led by MaC Venture Capital. - learn more

    LA Venture Funds


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