In a wide-ranging speech, Xi said that the G20 group “needs to discuss developing standards and principles for central bank digital currencies.”
Read more If implemented the declaration would require crypto firms in South Africa to register as a financial services provider.
Read more Coinbase is now measuring new capital coming in for bitcoin in the billions, according to the firm’s head of institutional coverage.
Read more Recapping a wild week in bitcoin price action that has drawn out numerous previously-quiet HODLers.
Read more Twitter is the latest social media site to allow users to experiment with posting disappearing content. Fleets, as Twitter calls them, allows its mobile users post short stories, like photos or videos with overlaying text, that are set to vanish after 24 hours.
But a bug meant that fleets weren’t deleting properly and could still be accessed long after 24 hours had expired. Details of the bug were posted in a series of tweets on Saturday, less than a week after the feature launched.
The bug effectively allowed anyone to access and download a user’s fleets without triggering a notification that the user’s fleet had been read and by whom. The implication is that this bug could be abused to archive a user’s fleets after they expire.
Using an app that’s designed to interact with Twitter’s back-end systems via its developer API. What returned was a list of fleets from the server. Each fleet had its own direct URL, which when opened in a browser would load the fleet as an image or a video. But even after the 24 hours elapsed, the server would still return links to fleets that had already disappeared from view in the Twitter app.
When reached, a Twitter spokesperson said a fix was on the way. “We’re aware of a bug accessible through a technical workaround where some Fleets media URLs may be accessible after 24 hours. We are working on a fix that should be rolled out shortly.”
Twitter acknowledged that the fix means that fleets should now expire properly, it said it won’t delete the fleet from its servers for up to 30 days — and that it may hold onto fleets for longer if they violate its rules. We checked that we could still load fleets from their direct URLs even after they expire.
Fleet with caution.
This is The TechCrunch Exchange, a newsletter that goes out on Saturdays, based on the column of the same name. You can sign up for the email here.
I had a neat look into the world of mental health startup fundraising planned for this week, but after being slow-motion carpet-bombed by S-1s, that is now shoved off to Monday and we have to pause and talk about COVID-19.
The pandemic has been the most animating force for startups and venture capital in 2020, discounting the slow movement of global business into the digital realm. But COVID did more than that, as we all know. It crashed some companies as assuredly as it gave others a boost. For every Peloton there is probably a Toast, in other words.
Such is the case with this week’s crop of unicorn IPO candidates, though they are unsurprisingly weighted far more toward the COVID-accelerated cohort of startups instead of the group of startups that the pandemic cut off at the knees.
More simply, COVID-19 gave most of our recent IPOs a polite shove in the back, helping them jog a bit faster toward the public-offering finish line. Let’s talk about it.
Roblox, the gaming company that targets kids, has been a beneficiary during the COVID-19 pandemic, as folks stayed home and, it appears, gave their kids money to buy in-game currency so that their parents could have some peace. Great business, even if Roblox warned that growth could slow sharply next year, when compared to its epic 2020 gains.
But Roblox is hardly the only company taking advantage of COVID-19’s impacts on the market to get public while their numbers are stellar. We saw DoorDash file last week, crowing from atop a mountain of revenue growth that came in part from you and I trying to stay home since March. As it turns out you order more delivery when you can’t leave your house.
Affirm got a COVID-19 boost as well, with not only e-commerce spend growing — Affirm provides point-of-sale loans to consumers during online shopping — but also because Peloton took off, and lots of folks chose to finance their new exercise bike with the payment service. Call it a double-boost.
The IPO is well-timed. Wish falls into the same bucket, though it did hit some supply-chain and delivery issues due to the pandemic, so you could argue it either way.
Regardless, as we have seen from global numbers, COVID-19 is very much not done wreaking havoc on our health, happiness, and ability to go about normal life. So the trends that this week’s S-1s have shown us still have some room to run.
Which is irksome for Airbnb, a unicorn that was supposed to have debuted already via a direct listing, but instead had to hit pause, borrow money, lay off staff, and now jog to the startup finish line with less revenue in this Q3 than the last. In time, Airbnb will get back to full-speed, but among our new IPO candidates it’s the only company net-harmed by COVID-19. That makes it special.
There are other trends to keep tabs on, regarding the pandemic. Not every software company that you might expect to be thriving at the moment actually is; Workday shares are off 8% today as I write to you, because the company said that COVID-19 is harming its ability to land new customers. Here’s its CFO Robynne Sisco from its earnings call
Keep in mind, however, that while we have seen some recent stability in the underlying environment, headwinds due to COVID remains particularly to net new bookings. And given our subscription model, these headwinds that have impacted us all year will be more fully evident in next year’s subscription revenue weighing on our growth in the near-term.
Yeesh. So don’t look at recent IPOs and think that all things are good for all companies, or even all software companies. (To be clear, the pandemic is a human crisis, but my job is to talk about its business impacts so here we are. Hugs, and please stay as safe as you can.)
Market Notes
There was so much news this week that we have to be annoyingly summary.
I caught up with Brex CEO Henrique Dubugras the other day, giving The Exchange a chance to parse what happened to the company during the early COVID days when the company decided to cut staff. The short answer from the CEO is that the company went from growing 10% to 15% each month, to seeing negative growth — not a sin, Airbnb saw negative gross bookings for a few months earlier this year — and as the company had hired for a big year, it had to make cuts. Dubugras talked about how hard of a choice that was to make.
Brex’s business rebounded faster than the company expected, however, driven in part by strong new business formation — some data here — and companies rapidly moving into the digital realm and moving to finance systems like Brex’s.
Looking forward, Dubugras wants to expand the pool of companies that Brex can underwrite, which makes sense as that would open up its market size quite a lot. And the company is as remote as companies are now, with its CEO opening up during our chat about the pros and cons of the move. Happily for the business fintech unicorn, Dubugras said that some of the negatives of companies working more remotely haven’t been as tough as expected.
Next up: Growth metric. Verbit, a startup that uses AI to transcribe and caption videos, raised a $60 million Series C this week led by Sapphire Ventures. I couldn’t get to the round, but the company did note in its release that it has seen 400% year-over-year revenue growth, and that its “revenue run-rate [has] grown five-fold since 2019.” Nice.
Jai Das led the round for Verbit, and, in a quirk of good timing, I’m hosting an Extra Crunch Live with him in a few weeks. (Extra Crunch sub required for that, head here if you need one. The discount code ‘EQUITY’ should still be working if it helps.)
Telos, a Virginia-based cybersecurity and identity company went public this week. It fell under our radar because there is more news than we have hands to type it up. Such is the rapid-fire news cycle of late 2020. But, to catch us both up, Telos priced midrange but with an upsized offering, valuing it around $1 billion, according to MarketWatch.
After going public, Telos shares have performed well. Cybersecurity is having one hell of a year.
Turning back to our favorite topic in the world, SaaS, ProfitWell’s Patrick Campbell dropped a grip of data on the impact of COVID-19 on the B2B SaaS market. Mostly it’s positive. There was a hit early on, but then growth seems to have accelerated. Just keep in mind the Workday example from earlier; not everyone is in software growth paradise as 2020 comes to a close.
And, finally, after Affirm released its S-1 filing, competing service Klarna decided it was a good time to drop some performance data of its own. First of all, Klarna — thanks. We like data. Second of all, just go public. Klarna said that it grew from 10 million customers in the United States to 11 million in three weeks, and that the second statistic was up 106% compared to its year-ago tally.
Affirm, you are now required by honor to update your S-1 with even more data as an arch-nerd clapback. Sorry, I don’t make the rules.
Various and Sundry
- Robinhood is no longer going to have no CEO two CEOs, it will now have one CEO. Good, The TechCrunch Exchange approves of all things IPO-prep.
- And speaking of Robinhood, this week The Exchange tried to figure out how much it grew in Q3. The answer? Not as much as it grew in Q2.
- Lime is profitable now? Mostly. What a turnaround.
- Bird wants to take flight via a SPAC. We have our doubts.
- Thank you, Google Chrome team.
- SaaS VCs are still super bullish on software growth, as Bessemer’s Byron Deeter made clear this week.
- This is what I look like when I am asleep.
Alright, that’s enough of all that. Chat to you soon, and I hope that you are safe and well and good.
Welcome back to Human Capital, where I break down the latest in diversity, equity and inclusion, and labor in tech.
TL;DR: This week, Apple announced its third head of diversity and inclusion in four years, Uber’s Black employee base shrunk despite the company committing to anti-racism and Reddit brought on its second Black board member this year.
Meanwhile, Facebook’s content moderators spoke out against the company for forcing some of them to work in the office during a pandemic and a new report from Silicon Valley Rising showed 63% of blue-collar tech workers are Black or Latinx.
Sign up here to get this as a newsletter in your inbox every Fridays at 1 p.m. PT. However, I’m taking next week off so you won’t be hearing from me until December 4.
Facebook content moderators demand better protections and benefits
A group of more than 200 Facebook content moderators, as well as some full-time employees, demanded the tech company “stop needlessly risking moderators’ lives,” they wrote in an open letter to Facebook and the company’s contractors that manage content moderators, Accenture and Covalen. The demands came after The Intercept reported how some Facebook content moderators — who deal with things like sexual abuse and graphic violence — were required to come back into the office during the pandemic. Shortly after they returned to the office, a Facebook content moderator reportedly tested positive for COVID-19.
Facebook later defended its decision to bring some content moderators into the office, saying it’s “not able to route some of the most sensitive and graphic content to outsourced reviewers at home,” its VP of Integrity Guy Rosen said on a press call. “This is really sensitive content. This is not something you want people reviewing from home with their family around.”
Turo commits $1 million to addressing wealth inequality
Car-sharing marketplace Turo teamed up with Kiva to offer interest-free loans to Black people and folks from traditionally underserved communities to buy cars and then share them on Turo. The $1 million commitment aims to address the issue of wealth inequality in the United States.
Called the Turo Seed Initiative, those who are eligible can raise up to $15,000 via crowdfunding and Turo’s matching program. In order to raise money on Kiva, folks must use the funding for business purposes, which includes car sharing on Turo. Through Kiva, they can raise up to $7,500 and Turo will then match up to $7,500. From there, they can buy a car and list it on Turo.
Tech’s cafeteria workers, security officers, etc. are predominantly Black or Latinx
A Silicon Valley Rising report recently showed about 63% of blue-collar tech workers are Black or Latinx. These are the workers who cook and serve food in tech company cafeterias, drive tech shuttles or work as security officers or custodians.
Also this week, a group of cafeteria workers who formerly worked inside Verizon Media’s offices protested outside its CEO’s home in San Francisco. These workers were laid off by Verizon Media contractor Compass in September. Meanwhile, LinkedIn stopped paying more than 260 food service workers at the end of June and Tesla laid off 280 janitors and bus drivers in April.
Transitioning from Trump to Biden: Now is not the time for complacency
On this week’s episode of TC Mixtape, we spoke with Y-Vonne Hutchinson of Ready Set about DEI and what a new administration means for the work she and so many others are doing. Here’s an excerpt from our conversation:
While I’m optimistic and so thrilled at the prospect that we’re not going to see harm like we did under the Trump administration, I also remember the Obama administration. This isn’t like these structures that got spun up — this didn’t happen out of the blue.
I hope that we have learned some really valuable lessons when it comes to the impact that not just like lack of diversity inclusion, because that feels so milk toast to say, but like these exclusionary and harmful organizations, platforms, powerful people in our industry, like I hope we’ve learned from our mistakes there. But I think that there’s always going to be a temptation to say, ‘well, we got Trump out and the work is done’ [or] feel a little bit complacent. I worry about that complacency. Because, you know, the dirty, nasty undercurrents, all of that stuff that got us to where we are today — all of that’s still there, all that festering toxicity.
We still have work to do, and I’m not saying that everybody’s a bad actor and you know, get rid of it. But I think that we really need to be critical and think about what accountability looks like for our industry and make sure that we’re not falling into the same bad habits that we did that got us here in the first place. So I’m kind of waiting to see how that plays out.
Apple announces a new head of D&I
Apple recently announced Barbara Whye, former head of D&I at Intel, will be joining them as its VP of inclusion and diversity in early 2021. The announcement came after its former head of D&I, Christie Smith, left the company in June “to spend time with her family,” an Apple spokesperson said at the time. Smith had been in the role since late 2017, after Denise Young Smith, the company’s first-ever VP of diversity and inclusion, left after only being in the role for six months.
Uber’s D&I efforts fall short this year
Uber recently released its latest diversity report, showing a decline in the overall representation of Black employees in the U.S. despite an increased focus on racial justice this year in the wake of the police killing of George Floyd. In 2019, Uber was 9.3% Black while this year, only 7.5% of its employees are Black.
Uber attributes the decline in Black employees to its layoffs earlier this year, where about 40% of its employees in community operations were laid off, Uber Chief Diversity Officer Bo Young Lee told TechCrunch.
“As a company that has so publicly stated its stance on anti-racism, that’s not acceptable,” she said.
That unintentional decline in the Black population at Uber “led to a lot of soul searching,” she said. “Dara was certainly upset by it. Every leader was. It reinforced how easy it is to lose some ground after all the work you’ve done.”
Reddit adds another Black director to the board
Reddit has appointed Paula Price, who has served on the board of six public companies, including Accenture and Deutsche Bank, to its board of directors. Price’s appointment makes her one of two Black directors on the company’s board.
“Paula’s vast experience as a world-class financial leader and strategic advisor will be a tremendous asset to us in the years ahead,” Reddit CEO Steve Huffman said in a statement. “Best of all, she embodies the two qualities most important to us for this Board seat: expertise leading companies through periods of transformative growth and real passion for Reddit’s mission.”
Before Reddit co-founder Alexis Ohanian stepped down from the board and urged the company to appoint a Black director to take his place, Reddit had zero Black board members. Reddit took Ohanian’s advice and appointed Y Combinator Michael Seibel to the board.
LAPD bans commercial facial recognition
Following an inquiry from Buzzfeed regarding officers’ use of Clearview, the LAPD has banned the use of commercial facial recognition programs. That’s not to say LAPD won’t continue using facial recognition that compares images to suspect booking records but it will no longer use facial recognition tools that rely on social media and other websites.
Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7 a.m. PT). Subscribe here.
The wait was long but this week the time was right: Airbnb finally filed its S-1 and so did Affirm, C3.ai, Roblox, and Wish. We are likely to see these five price on public markets before the end of an already superlative year for tech IPOs. The ongoing pandemic and political turmoil were not scary enough, apparently.
This coming decade, you have to think that we’ll see a more even spread of tech companies going public. Many of the companies above have been bottled up for years behind privately funded growth strategies. Today, however, the industry has a better grasp of SPACs and direct listings, and various funding routes. Companies have more options from their founding for how they might grow and exit one day. Public investors in 2020 also seem to have a deeper appreciation for the current revenue numbers and future growth opportunities for tech companies. Why, I can still remember all the geniuses who bragged about shorting the Facebook IPO not so long ago.
Will we see a more even spread of where IPOs come from? While all of this week’s filers are headquartered in San Francisco or environs, that now feels almost like a coincidental reference to the years when these companies were founded. More states have been minting their own unicorns, with Ohio-based Root Insurance recently going public and Utah-based Qualtrics heading (back) that way. Tech startups are now global, meanwhile, and plenty of countries are working to keep their unicorns closer to home than New York.
On to the headlines from TechCrunch and Extra Crunch:
If you didn’t make $1B this week, you are not doing VC right (EC)
Inside Affirm’s IPO filing: A look at its economics, profits and revenue concentration (EC)
5 questions from Airbnb’s IPO filing (EC)
The VC and founder winners in Airbnb’s IPO (EC)
Wish files to go public with 100M monthly actives, $1.75B in 2020 revenue thus far
Unpacking the C3.ai IPO filing (EC)
With a 2021 IPO in the cards, what do we know about Robinhood’s Q3 performance? (EC)
(Photo by Win McNamee/Getty Images)
What does a Biden administration mean for tech?
What does Joe Biden intend as president around technology policy? On the one hand, tech companies might not be returning to the White House too fast. “All told, we’re seeing some familiar names in the mix, but 2020 isn’t 2008,” Taylor Hatmaker explains about potential presidential appointments from the industry. “Tech companies that emerged as golden children over the last 10 years are radioactive now. Regulation looms on the horizon in every direction. Whatever policy priorities emerge out of the Biden administration, Obama’s technocratic gilded age is over and we’re in for something new.”
However, tech industries and companies focused on shared goals might find support. In a review of Biden’s climate-change policies, Jon Shieber looks at major green infrastructure plans that could be on the way.
Any policies that a Biden administration enacts would have to focus on economic opportunity broadly, and much of the proposed plan from the campaign fulfills that need. One of its key propositions was that it would be “creating good, union, middle-class jobs in communities left behind, righting wrongs in communities that bear the brunt of pollution, and lifting up the best ideas from across our great nation — rural, urban and tribal,” according to the transition website. An early emphasis on grid and utility infrastructure could create significant opportunities for job creation across America — and be a boost for technology companies. “Our electric power infrastructure is old, aging and not secure,” said Abe Yokell, co-founder of the energy and climate-focused venture capital firm Congruent Ventures. “From an infrastructure standpoint, transmission distribution really should be upgraded and has been underinvested over the years. And it is in direct alignment with providing renewable energy deployment across the U.S. and the electrification of everything.”
Image Credits: Steve Proehl (opens in a new window) / Getty Images
The future of construction tech
A skilled labor shortage is piling on top of the construction industry’s traditional challenges this year. The result is that tech adoption is getting a big push into the real world, Allison Xu of Bain Capital Ventures writes in a guest column for Extra Crunch this week. She maps out six main construction categories where tech startups are emerging, including project conception, design and engineering, pre-construction, construction execution, post construction and construction management. Here’s an excerpt from the article about that last item:
- How it works today: Construction management and operations teams manage the end-to-end project, with functions such as document management, data and insights, accounting, financing, HR/payroll, etc.
- Key challenges: The complexity of the job site translates to highly complex and burdensome paperwork associated with each project. Managing the process requires communication and alignment across many stakeholders.
- How technology can address challenges: The nuances of the multistakeholder construction process merit value in a verticalized approach to managing the project. Construction management tools like Procore, Hyphen Solutions and IngeniousIO have created ways for contractors to coordinate and track the end-to-end process more seamlessly. Other players like Levelset have taken a construction-specific approach to functions like invoice management and payments.
Virtual HQs after the pandemic?
Pandemic-era work solutions like online team meeting spaces are heading towards a less certain, vaccine-based reality. Have we all gone remote-first enough that they will have a real market, still? Natasha Mascarenhas checks in with some of the top companies to see how it’s looking, here’s more:
With the goal of making remote work more spontaneous, there are dozens of new startups working to create virtual HQs for distributed teams. The three that have risen to the top include Branch, built by Gen Z gamers; Gather, created by engineers building a gamified Zoom; and Huddle, which is still in stealth.
The platforms are all racing to prove that the world is ready to be a part of virtual workspaces. By drawing on multiplayer gaming culture, the startups are using spatial technology, animations and productivity tools to create a metaverse dedicated to work.
The biggest challenge ahead? The startups need to convince venture capitalists and users alike that they’re more than Sims for Enterprise or an always-on Zoom call. The potential success could signal how the future of work will blend gaming and socialization for distributed teams.
Around TechCrunch
Head of the US Space Force, Gen. John W. ‘Jay’ Raymond, joins us at TechCrunch Sessions: Space
Amazon’s Project Kuiper chief David Limp is coming to TC Sessions: Space
Across the week
TechCrunch
Against all odds: The sheer force of immigrant startup founders
S16 Angel Fund launches a community of founders to invest in other founders
Why are telehealth companies treating healthcare like the gig economy?
A court decision in favor of startup UpCodes may help shape open access to the law
Extra Crunch
Will Zoom Apps be the next hot startup platform?
Is the internet advertising economy about to implode?
Surging homegrown talent and VC spark Italy’s tech renaissance
Why some VCs prefer to work with first-time founders
3 growth tactics that helped us surpass Noom and Weight Watchers
A report card for the SEC’s new equity crowdfunding rules
#EquityPod
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast (now on Twitter!), where we unpack the numbers behind the headlines.
This week wound up being incredibly busy. What else, with a week that included both the Airbnb and Affirm IPO filings, a host of mega-rounds for new unicorns, some fascinating smaller funding events and some new funds?
So we had a lot to get through, but with Chris and Danny and Natasha and your humble servant, we dove in headfirst:
- Affirm has filed to go public! The fintech unicorn is big, growing and losing less money over time. We were pretty impressed in our first look. Then, with a bit more time, we dug deeper and found a weakness or two. Still, Affirm is heading public and not in poor shape.
- Airbnb filed, and we jumped into an Equity Shot as fast as we could on Tuesday to get our minds around the news. Since then, Danny dug through the venture capital winners circle — a surprisingly small subset of firms! — and we also got into some questions that I had about the company’s finances.
- Robinhood is said to have an IPO in the books, so we talked a bit about what we know concerning its Q3 growth.
- And then there was edtech, as always. This week we talked about Tencent backing Udemy, Duolingo raising again and Transfr picking up a Series A that we thought was super interesting.
- Danny wanted to talk about the Trust & Will Series A. We tried to not make that many jokes.
- ZenBusiness raised $55 million as well, in an outsized Series B.
- Financial Venture Studio put together a new fund to cut small checks into seed-stage fintech startups. We think that’s great. Especially given what we know about what is going on in the fintech venture world.
- And Natasha walked us through her latest deep-dive, a look into the world of virtual headquarters. This led to the worst joke of the show.
What a week! Three episodes, some new records, and a very tired us after all the action. More on Monday!
Equity drops every Monday at 7:00 a.m. PDT and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.
Hulu is the first major streaming platform to offer a social watching experience. And with most major league sports now being allowed to resume behind closed doors, Hulu’s combined proposition with ESPN will likely help entertain the service’s 30+ million users over the winter months.
But users have a surplus in choice of streaming services right now, so how will Hulu stay competitive?
With the help of UX expert Peter Ramsey from Built for Mars, we’re going to give Hulu an Extra Crunch UX teardown, demonstrating five ways it could improve its overall user experience. These include easy product comparisons, consistent widths, proportionate progress bars and other suggestions.
Comparing features inside packages
If your product/service has different tiers/versions, ensure that the differences between these options are obvious and easy to compare.
The fail: Hulu has four different packages, but the listed features are inconsistent between options, making it incredibly difficult to compare. Instead of using bullet points, they’ve buried the benefits within paragraphs.
The fix: Break the paragraphs down into bullet points. Then, make sure that the bullet points are worded consistently between options.
Steve O’Hear: I’m really surprised this one got past the marketing department. Not a lot to say except that I would argue that when UX, including layout and copywriting decisions, become decoupled from business goals and customer wants, a company is in trouble. Would you agree that’s what has happened here?
Peter Ramsey: Honestly, this happens all the time. I think it’s just a symptom of the designers building things that look nice, not things that work nicely. I probably raise this issue on about one-third of the private audits I do — it’s that common.
Keep a consistent width
Try to maintain a consistent page width throughout a single journey — unless there’s a major benefit to changing the width.
The fail: During the Hulu sign-up process, the page width doubles at a totally unnecessary point. This is disorienting for the user, with no obvious rationale.
The fix: Hulu has a pretty consistent first-half of their journey and then it drops the ball. I’d redesign these “extra-wide” pages to be the default width.
On Tuesday night, President Donald Trump fired Chris Krebs, who was one of the government’s most senior cybersecurity officials. Trump fired him—by tweet—because Krebs had thoroughly debunked election disinformation, much of which came from the White House itself.
Trump had appointed Krebs director of the Cybersecurity and Infrastructure Security Agency (CISA) in 2017. CISA is charged with protecting American critical infrastructure, a vast domain ranging from elections technology to vaccine manufacturing and government systems. Many of the United States’ most sensitive networks fall under CISA’s purview. With Krebs out and Trump’s presidency ending, where does that leave one of America’s most important cybersecurity agencies?
A years-long bipartisan effort to remake the way the US government works in cyberspace could soon push CISA into an elevated role as the nation’s lead cybersecurity agency with a bigger budget, a strengthened position, and louder White House support. The future role of CISA will be key as the transitioning American government tries to sort out its strategy in increasingly combative cyberspace.
“I think CISA is in a very strong position,” says Suzanne Spaulding, Krebs’s predecessor and a person whose name has been floated as a potential secretary of homeland security in a Biden administration. “Chris Krebs’s principled stand and departure adds to CISA’s stature and reputation. There is strong bipartisan support for strengthening CISA’s role.”
The agency’s new acting director, Brandon Wales, is a career civil servant who can’t easily be fired by the president—though he could be moved to another position. Wales, a 15-year Department of Homeland Security veteran, has been widely praised by current and former colleagues.
In an interview last month with MIT Technology Review, Wales spoke about CISA’s important role in debunking domestic disinformation. Employees at CISA say that so far, work has continued on as normal, exactly as Wales promised—except with a decrease in morale. Trump has also said he will move another official, Sean Plankey, to a senior post at CISA, a move that is reportedly “imminent.”
But as Trump’s presidency comes to a close, eyes are turning to CISA’s long-term future.
Spaulding worked on the Cyberspace Solarium Commission, a bipartisan congressional project established in 2019 to chart the future of American strategy in cyberspace. The commission made enhancing and empowering CISA one of its top priorities.
Chaired by the independent senator Angus King and the Republican congressman Mike Gallagher, Solarium aims to make the CISA the lead cybersecurity agency for the federal government and private companies in the US. King is reportedly a leading candidate for Biden’s director of national intelligence.
The Solarium recommendations include bolstering CISA’s resources, facilities, and authorities. The commission wants CISA to lead the government response to major cyber incidents in both the public and private sectors and to have the authority to hunt cyber threats across the entire government outside of the military—which, they note, boasts a much larger cybersecurity budget at about $9.6 billion and growing, compared with approximately $2 billion for CISA.
“Significant breaches that we’ve seen in the past in government could have been mitigated and more rapidly dealt with” with a fully-realized CISA, says Mark Montgomery, Solarium’s executive director. “And we haven’t had, for example, a significant attack on the electric grid or water system yet—the kind of attack that would make us wish for a stronger CISA. We’re hoping we can get CISA ready before those happen.”
As Biden’s presidency approaches, members of both parties are hoping for a bigger budget for the agency and a strong signal from the new White House that CISA is the primary way the US government protects critical infrastructure that’s mostly run by private companies, whether in the domain of elections, finance, or energy. CISA’s mandate includes managing cybersecurity issues but also defending against other kinds of threats, like terrorism, weather disasters, and sabotage. To support that expansive mission, Spaulding says, the agency needs significantly more funding.
The Biden-Harris transition team did not respond to questions about CISA’s future.
The irony of Trump’s sudden interest in CISA is that his White House has done little or nothing to help the agency and its partners at the National Security Agency and the Federal Bureau of Investigation in their work of securing elections. To an unprecedented extent, the White House abdicated its responsibility for coordinating the work of different agencies on this major national security issue.
“What’s interesting is that somehow these departments and agencies have found a way to coordinate among themselves without the traditional coordination function at the White House,” says Tom Bossert, Trump’s former homeland security advisor, whose office would normally have taken the lead on that task. “Krebs, [cyber command and NSA director] Paul Nakasone, [FBI director] Chris Wray, and the director of national intelligence have found a way to integrate their operations without somebody sitting in the head chair at the table. There’s no precedent for this in the modern presidency.”
While the agency’s long-term trajectory is increasingly clear, the short-term future of CISA remains an open question. Krebs was fired in large part for creating a Rumor Control web page that combated disinformation in real time. So far, the page has stayed up and unchanged. Brandon Wales is well respected but could theoretically be moved out of the agency, so his fate continues to be tied to the president’s whims.
“He’s a brilliant analyst,” says Spaulding, who was Wales’s boss during the Obama administration. Wales “should help keep things on track at CISA as long as he’s allowed to stay in that position,” she says. “The challenge, of course, is that they are likely to continue to find themselves saying things that the White House doesn’t like.”