In early November, gale-force winds whipped a brush fire into an inferno that nearly consumed the town of Paradise, California, and killed at least 86 people.
By the second morning, I could smell the fire from one foot outside my door in Berkeley, some 130 miles from the flames. Within a week, my eyes and throat stung even when I was indoors.
Air quality maps warned that the soot-filled air blanketing the Bay Area had reached “very unhealthy” levels. For days, nearly everyone wore masks as they walked their dogs, rode the train, and carried out errands. Most of those thin-paper respirators were of dubious value. Stores quickly ran out of the good ones—the “N-95s” that block 95% of fine particles—and sold out of air purifiers, too.
People traded tips about where they could be found, and rushed to stores rumored to have a new supply. Others packed up and drove hours away in search of a safe place to wait it out. By the time my masks arrived by mail, I was in Ohio, having decided to move up my Thanksgiving travel to escape the smoke.
Climate change doesn’t ignite wildfires, but it’s intensifying the hot, dry summer conditions that have helped fuel some of California’s deadliest and most destructive fires in recent years.
I’ve long understood that the dangers of global warming are real and rising. I’ve seen its power firsthand in the form of receding glaciers, dried lake beds, and Sierra tree stands taken down by bark beetles.
This is the first time, though, that I smelled and tasted it in my home.
Obviously, a sore throat and a flight change are trivial compared with the lives and homes lost in the Camp Fire. But after I spent a week living under a haze of smoke, it did resonate on a deeper level that we’re really going to let this happen.
Thousands if not millions of people are going to starve, drown, burn to death, or live out lives of misery because we’ve failed to pull together in the face of the ultimate tragedy of the commons. Many more will find themselves scrambling for basic survival goods and fretting over the prospect of more fires, more ferocious hurricanes, and summer days of blistering heat.
There’s no solving climate change any longer. There’s only living with it and doing everything in our power to limit the damage.
And seeing an entire community near one of the world’s richest regions all but wiped out, while retailers failed to meet critical public needs in the aftermath, left me with a dimmer view of our ability to grapple with the far greater challenges to come.
Some observers believe that once the world endures enough climate catastrophes, we’ll finally come to our collective senses and make some last-minute push to address the problem. But for many, that will be too late.
Carbon dioxide takes years to reach its full warming effect and persists for millennia. We may well have already emitted enough to sail past a dangerous 1.5 ˚C of warming. And at the rate we’re going, it could take hundreds of years to shift to a global energy system that doesn’t pump out far more climate pollution—every ton of which only makes the problem worse.
President Barack Obama’s top science advisor, John Holdren, once said that our options for dealing with climate change are cutting emissions, adapting (building, say, higher seawalls or city cooling centers), and suffering.
Since we’re utterly failing in the first category, far more of the job will inevitably come down to the latter two. By choosing not to deal with the root cause, we’ve opted to deal with the problem in the most expensive, shortsighted, destructive, and cruel way possible.
We could have overhauled the energy system. Instead we’ll have to overhaul almost every aspect of life: expanding emergency response, building more hospitals, fortifying our shorelines, upgrading our building materials, reengineering the way we grow and distribute food, and much more.
And even if we pay the high price to do all that, we’ll still have worse outcomes than if we had tackled the core problem in the first place. We’ve decided to forever diminish our quality of life, sense of security, and collective odds of living out happy and healthy lives. And we’ve done it not just for ourselves, but for our children and foreseeable future generations.
Uneven and unfair
The devastation from climate change will manifest in different ways in different places, in highly uneven and unfair ways: severe drought and famine across much of Africa and Australia, shrinking water supplies for the billions who rely on the glaciers of the Tibetan Plateau, and the threat of forced displacement for at least tens of millions exposed to rising sea levels in South Asia.
In California, higher temperatures, declining snowpack, and shifting precipitation patterns mean more people already live under the threat of droughts and fires.
I’ve smelled or spotted four major blazes in the last two years. This July, a close friend and her pregnant sister sped down Interstate 580, through the Altamont Pass, as flames raged on both sides. Another friend raced into Paradise to evacuate her father on the morning that the Camp Fire tore through the town. Still another sifted ashes in the remnants of homes a few days later, looking for bone fragments and other human remains as part of a local search and rescue team.
Global warming has already doubled the area scorched by forest fires during the last three decades across the American West, according to an earlier study in Proceedings of the National Academy of Sciences. By midcentury, that footprint could swell again by a multiple of two to six, according to the recent US National Climate Assessment (see “Cutting emissions could prevent tens of thousands of heat deaths annually”).
None of this is a defense for throwing up our hands—it’s an argument for redoubling our efforts. Even if we’re not going to “solve” climate change, we’re going to have to work feverishly to manage it, like a chronic disease. We need to learn to live with the symptoms while finding ways to keep them from getting worse.
Every additional gigaton of greenhouse gas we put into the atmosphere from this point forward only increases the economic costs, ecosystem devastation, and human suffering.
So the question is: What’s it going to take to finally bring about the public policies, accelerated innovation, and collective will needed to force rapid change?
One hopes that as climate change becomes increasingly undeniable, and its effects come to feel like real and immediate threats to our well-being, people will demand that our leaders and industries take aggressive action.
Research has found that experiencing higher temperatures and extreme weather events is correlated with greater belief in or concern about climate change. And younger people, who are staring at a much grimmer future, are considerably more likely to believe that climate change is real and action is required—even among millennial Republicans in the US.
But as I watched the death count rise from simultaneous infernos across California last month, it struck me that another possibility was just as plausible: the destruction of climate change will overwhelm society in ways that make us less likely to undertake the sacrifices necessary for a safer future.
We’re likely to face a shrinking economy, skyrocketing emergency response costs, and a staggering price tag for adaptions measures like seawalls—all while we still need to race to zero emissions as quickly as possible.
People may dig deep for certain adaptions that promise to improve their security immediately—but the perceived return on investments into cutting emissions could shrink as extreme weather becomes more common and costly. That’s because, again, carbon dioxide works on a time delay, and the problem only stops getting worse—doesn’t disappear—once we’ve reached zero emissions (unless we figure out how to suck massive amounts of it from the atmosphere as well).
As more of our money, time, and energy gets sucked up by the immediate demands of overlapping tragedies, I fear people may become less willing to invest increasingly limited resources in the long-term common good.
Put another way, one paradoxical impact of climate change is that it could make many even more reluctant to take it on.
Worse to come
When I started writing seriously about climate change a little more than five years ago, the dangers largely seemed distant and abstract. Without realizing it, most of this time I’ve carried along an assumption that we will somehow, eventually, confront the problem in a meaningful way. We don’t have a choice. So sooner or later, we’ll do the right thing.
But after two years closely reporting and writing on clean energy technologies here, it has slowly dawned on me that, well, maybe not. While we absolutely could accomplish much of the necessary transformation with existing or emerging technologies, the sheer scale of the overhaul required and the depth of the entrenched interests may add up to insurmountable levels of inertia.
So the Camp Fire and its aftermath didn’t singlehandedly push me from optimism to pessimism. The more I’ve come to understand the true parameters of the problem, the more I’ve tilted toward the dire side of the spectrum.
But the surreal scene of high-paid workers walking through the murky yellow air of downtown San Francisco, masks inadvertently color-coordinated with their earbuds in the capital of techno-utopianism, certainly widened my frame of the possible—and felt like a taste of things to come.
These ten enterprise M&A deals totaled over $40B in 2019
It would be hard to top the 2018 enterprise M&A total of a whopping $87 billion, and predictably this year didn’t come close. In fact, the top 10 enterprise M&A deals in 2019 were less than half last year’s, totaling $40.6 billion. This year’s biggest purchase was Salesforce buying Tableau for $15.7 billion, which would…
It would be hard to top the 2018 enterprise M&A total of a whopping $87 billion, and predictably this year didn’t come close. In fact, the top 10 enterprise M&A deals in 2019 were less than half last year’s, totaling $40.6 billion.
This year’s biggest purchase was Salesforce buying Tableau for $15.7 billion, which would have been good for third place last year behind IBM’s mega deal plucking Red Hat for $34 billion and Broadcom grabbing CA Technologies for $18.8 billion.
Contributing to this year’s quieter activity was the fact that several typically acquisitive companies — Adobe, Oracle and IBM — stayed mostly on the sidelines after big investments last year. It’s not unusual for companies to take a go-slow approach after a big expenditure year. Adobe and Oracle bought just two companies each with neither revealing the prices. IBM didn’t buy any.
Microsoft didn’t show up on this year’s list either, but still managed to pick up eight new companies. It was just that none was large enough to make the list (or even for them to publicly reveal the prices). When a publicly traded company doesn’t reveal the price, it usually means that it didn’t reach the threshold of being material to the company’s results.
As always, just because you buy it doesn’t mean it’s always going to integrate smoothly or well, and we won’t know about the success or failure of these transactions for some years to come. For now, we can only look at the deals themselves.
Jumia, DHL, and Alibaba will face off in African ecommerce 2.0
The business of selling consumer goods and services online is a relatively young endeavor across Africa, but ecommerce is set to boom. Over the last eight years, the sector has seen its first phase of big VC fundings, startup duels and attrition. To date, scaling e-commerce in Africa has straddled the line of challenge and…
The business of selling consumer goods and services online is a relatively young endeavor across Africa, but ecommerce is set to boom.
Over the last eight years, the sector has seen its first phase of big VC fundings, startup duels and attrition.
To date, scaling e-commerce in Africa has straddled the line of challenge and opportunity, perhaps more than any other market in the world. Across major African economies, many of the requisites for online retail — internet access, digital payment adoption, and 3PL delivery options — have been severely lacking.
Still, startups jumped into this market for the chance to digitize a share of Africa’s fast growing consumer spending, expected to top $2 billion by 2025.
African e-commerce 2.0 will include some old and new players, play out across more countries, place more priority on internet services, and see the entry of China.
But before highlighting several things to look out for in the future of digital-retail on the continent, a look back is beneficial.
Jumia vs. Konga
The early years for development of African online shopping largely played out in Nigeria (and to some extent South Africa). Anyone who visited Nigeria from 2012 to 2016 likely saw evidence of one of the continent’s early e-commerce showdowns. Nigeria had its own Coke vs. Pepsi-like duel — a race between ventures Konga and Jumia to out-advertise and out-discount each other in a quest to scale online shopping in Africa’s largest economy and most populous nation.
Traveling in Lagos traffic, large billboards for each startup faced off across the skyline, as their delivery motorcycles buzzed between stopped cars.
Covering each company early on, it appeared a battle of VC attrition. The challenge: who could continue to raise enough capital to absorb the losses of simultaneously capturing and creating an e-commerce market in notoriously difficult conditions.
In addition to the aforementioned challenges, Nigeria also had (and continues to have) shoddy electricity.
Both Konga — founded by Nigerian Sim Shagaya — and Jumia — originally founded by two Nigerians and two Frenchman — were forced to burn capital building fulfillment operations most e-commerce startups source to third parties.
That included their own delivery and payment services (KongaPay and JumiaPay). In addition to sales of goods from mobile-phones to diapers, both startups also began experimenting with verticals for internet based services, such as food-delivery and classifieds.
While Jumia and Konga were competing in Nigeria, there was another VC driven race for e-commerce playing out in South Africa — the continent’s second largest and most advanced economy.
E-tailers Takealot and Kalahari had been jockeying for market share since 2011 after raising capital in the hundreds of millions of dollars from investors Naspers and U.S. fund Tiger Global Management.
So how did things turn out in West and Southern Africa? In 2014, the lead investor of a flailing Kalahari — Naspers — facilitated a merger with Takealot (that was more of an acquisition). They nixed the Kalahari brand in 2016 and bought out Takelot’s largest investor, Tiger Global, in 2018. Takealot is now South Africa’s leading e-commerce site by market share, but only operates in one country.
In Nigeria, by 2016 Jumia had outpaced its rival Konga in Alexa ratings (6 vs 14), while out-raising Konga (with backing of Goldman Sachs) to become Africa’s first VC backed, startup unicorn. By early 2018, Konga was purchased in a distressed acquisition and faded away as a competitor to Jumia.
Jumia went on to expand online goods and services verticals into 14 Africa countries (though it recently exited a few) and in April 2019 raised over $200 million in an NYSE IPO — the first on a major exchange for a VC-backed startup operating in Africa.
Jumia’s had bumpy road since going public — losing significant share-value after a short-sell attack earlier in 2019 — but the continent’s leading e-commerce company still has heap of capital and generates $100 million in revenues (even with losses).
Airbnb’s New Year’s Eve guest volume shows its falling growth rate
Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between. It’s finally 2020, the year that should bring us a direct listing from home-sharing giant Airbnb, a technology company valued at tens of billions of dollars. The company’s flotation will be a key event in…
Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.
It’s finally 2020, the year that should bring us a direct listing from home-sharing giant Airbnb, a technology company valued at tens of billions of dollars. The company’s flotation will be a key event in this coming year’s technology exit market. Expect the NYSE and Nasdaq to compete for the listing, bankers to queue to take part, and endless media coverage.
Given that that’s ahead, we’re going to take periodic looks at Airbnb as we tick closer to its eventual public market debut. And that means that this morning we’re looking back through time to see how fast the company has grown by using a quirky data point.
Airbnb releases a regular tally of its expected “guest stays” for New Year’s Eve each year, including 2019. We can therefore look back in time, tracking how quickly (or not) Airbnb’s New Year Eve guest tally has risen. This exercise will provide a loose, but fun proxy for the company’s growth as a whole.
Before we look into the figures themselves, keep in mind that we are looking at a guest figure which is at best a proxy for revenue. We don’t know the revenue mix of the guest stays, for example, meaning that Airbnb could have seen a 10% drop in per-guest revenue this New Year’s Eve — even with more guest stays — and we’d have no idea.
So, the cliche about grains of salt and taking, please.
But as more guests tends to mean more rentals which points towards more revenue, the New Year’s Eve figures are useful as we work to understand how quickly Airbnb is growing now compared to how fast it grew in the past. The faster the company is expanding today, the more it’s worth. And given recent news that the company has ditched profitability in favor of boosting its sales and marketing spend (leading to sharp, regular deficits in its quarterly results), how fast Airbnb can grow through higher spend is a key question for the highly-backed, San Francisco-based private company.
- 2009: 1,400
- 2010: 6,000 (+329%)
- 2011: 3,1000 (+417%)
- 2012: 108,000 (248%)
- 2013: 250,000 (+131%)
- 2014: 540,000 (+116%)
- 2015: 1,100,000 (+104%)
- 2016: 2,000,000 (+82%)
- 2017: 3,000,000 (+50%)
- 2018: 3,700,000 (+23%)
- 2019: 4,500,000 (+22%)
In chart form, that looks like this:
Let’s talk about a few things that stand out. First is that the company’s growth rate managed to stay over 100% for as long as it did. In case you’re a SaaS fan, what Airbnb pulled off in its early years (again, using this fun proxy for revenue growth) was far better than a triple-triple-double-double-double.
Next, the company’s growth rate in percentage terms has slowed dramatically, including in 2019. At the same time the firm managed to re-accelerate its gross guest growth in 2019. In numerical terms, Airbnb added 1,000,000 New Year’s Eve guest stays in 2017, 700,000 in 2018, and 800,000 in 2019. So 2019’s gross adds was not a record, but it was a better result than its year-ago tally.
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