Update on plans for New York City headquarters

After much thought and deliberation, we’ve decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens. For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term. While polls show that 70% of New Yorkers support our plans and investment, a number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project we and many others envisioned in Long Island City.

We are disappointed to have reached this conclusion—we love New York, its incomparable dynamism, people, and culture—and particularly the community of Long Island City, where we have gotten to know so many optimistic, forward-leaning community leaders, small business owners, and residents. There are currently over 5,000 Amazon employees in Brooklyn, Manhattan, and Staten Island, and we plan to continue growing these teams.

We are deeply grateful to Governor Cuomo, Mayor de Blasio, and their staffs, who so enthusiastically and graciously invited us to build in New York City and supported us during the process. Governor Cuomo and Mayor de Blasio have worked tirelessly on behalf of New Yorkers to encourage local investment and job creation, and we can’t speak positively enough about all their efforts. The steadfast commitment and dedication that these leaders have demonstrated to the communities they represent inspired us from the very beginning and is one of the big reasons our decision was so difficult.

We do not intend to reopen the HQ2 search at this time. We will proceed as planned in Northern Virginia and Nashville, and we will continue to hire and grow across our 17 corporate offices and tech hubs in the U.S. and Canada.

Thank you again to Governor Cuomo, Mayor de Blasio, and the many other community leaders and residents who welcomed our plans and supported us along the way. We hope to have future chances to collaborate as we continue to build our presence in New York over time.

Today in Philly Tech History 2/14/2012: Capital One's $9 billion acquisition of Wilmington-based ING Direct USA gets Fed approval

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Five years ago, on February 14, 2012, Capital One's $9 billion acquisition of Wilmington-based Internet bank ING Direct USA won approval from the Federal Reserve, clearing the way for the deal to close within a few days.

The deal, announced in June 2011, featured a Wilmington-bred success story although its parent, Netherlands-based ING Groep NV, had to auction it off to satisfy European banking regulators. ING Direct USA added $80 billion in deposits and 7 million customers to Capital One.

ING Diect's loyal customer base was concerned about how Capital One would change its newly acquired bank. Indeed, some of those changes were just implemented, as ING Direct has been renamed Capital One 360, and ING Direct's famous orange logo was taken down early this month and driven away and replaced with a spiffy new Capital One sign on the headquarters building in downtown Wilmington.




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ADT acquires Langhorne-based LifeShield

Tom Paine


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ADT has acquired LifeShield, the Langhorne-based DIY home security systems company, for about $25 million.

LifeShield, founded in 2004 and a pioneer in DIY home security, has been passed around frequently recently. It was acquired by DirecTV in 2013, and went with DirecTV to AT&T after that acquisition in 2015. At&T had no plan for it, and it floundered there, I understand.

It was sold back to former CEO Michael Hagan (also ex-Verticalnet, Nutrisystem) and his Hawk Capital Partners in 2017.

“As more consumers look for real protection solutions that only ADT can provide, we look for companies that share our passion for security, customer service, and innovation,” said ADT President and CEO Jim DeVries, in a press release . “We are confident that LifeShield’s capabilities and approach, combined with the brand and scale of ADT, will create an opportunity for us to offer our services to a broader cross-section of U.S. households. Together with LifeShield we will be positioned to offer more solutions to a broader base of customers and create increased value for our shareholders as we seek to grow profitability through expanded, yet focused offerings.”

LifeShield recently introduced a video doorbell, and a Google Assistant toolkit.

John Owens will continue to lead LifeShield, and Hagan will serve as an advisor.

Radnor-based Avantor files for IPO. #avantor #vwr

Tom Paine


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Radnor-based Avantor, a chemical producer and distributor patched together through acquisitions, filed an S-1 registration statement for an IPO today . Avantor is a portfolio company of PE firm New Mountain Capital, and its executive chairman is former Rohm & Haas CEO Rajiv L. Gupta. Gupta, now Senior Advisor to New Mountain, also served as interim CEO of Avantor.

New Mountain acquired specialty chemical maker Mallinckrodt Baker, based in the Lehigh Valley, in 2010, and that became the original basis of Avantor.

Then, in November 2017, Avantor acquired Radnor-based VWR, a distributor of chemical and scientific supplies for Life Sciences amd other segments, for $6.5 billion. That business far outweighed the former Mallinckrodt business in size and scope. It also left Avantor with an enormous long-term debt load of $7.2 billion. IPO proceeds, which Avantor has bookmarked on the S-! as $100 million but could be as high as $1.5 billion, will be used primarily to reduce New Mountain's debt obligations.

But VWR is an exciting business, with an industrial ecommerce model that can be a market leader. Its a consolidation play on the small batch specialty chemical and supplies market.

I haven't had enough time to digest numbers and analysis yet, but wanted to get this out first.

California hospitality platform Zingle raises $11 million, acquires Philly AI startup

Tom Paine


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California-based hospitality platform Zingle announced $11 million in venture capital funding last week , from PeakSpan Capital.

At the same time, the company said it had acquired a Philadelphia AI startup, Presto (sometimes referred to as Presto AI), apparently late last year.

From Presto's LinkedIn page, this description:


Acquired in 2018, Presto developed predictive NLP models that perform the world's best classification, similarity analysis, and entity recognition in the hospitality domain. We set out to improve the quality and efficiency of text based guest interactions in hotels. Presto's mission is to create experiences better than humanly possible.

Presto was started by a team at the University of Pennsylvania passionate about hospitality, computational linguistics, and data science.

According to Zingle's press release:

With the acquisition of Philadelphia-based Presto AI, a hospitality-focused, computational linguistics, and data science team, the Zingle platform has evolved significantly. By analyzing and learning from millions of monthly messages exchanged between guests and hotels, the solution is able to categorize over 150 different intents, making responses smarter and more personalized. Message data is also stored in Zingle’s analytics and can be used to inform data-driven decisions, i.e., using message volume trends to make smarter staffing decisions.

"Through the acquisition of the Presto AI team, the Zingle platform has taken a significant step forward,” continued Blakely. “Zingle is now uniquely positioned to provide hotels an AI-equipped solution that meets growing consumer demand for both digital engagement and automated onsite convenience while improving guest engagement intelligence from booking to check-out."

There was a similarly targeted startup in Philly a few years ago (can't remember name) that didn't quite take off.

Today in Philly Tech History 2/10/1998: CDNow completes IPO

Tom Paine

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On February 10, 1998, CDNow, started in 1994 by twin brothers Jason and Matthew Olim out of their parent's basement in Ambler, completed its initial public offering. The online music retailer, which sparked a revolution in music distribution, closed the day up 37.5% at $22, from its opening price of $16. CDNow raised $65.6 million, and had a market capitalization of $342 million at day's end. Based in Jenkintown at the time it went public, it later moved to Fort Washington.

When it went public, its prior year revenue was $17.4 million, with a net loss of $10.7 million. Shortly afterwards, CDNow acquired its largest competitor, another Philadelphia area company named N2K. Revenue grew rapidly to a $150 million run rate, and CDNow was an early innovator in ecommerce and web marketing techniques.

However, as the crisis in the Internet economy materialized in 2000, investors lacked confidence in CDNow's financial performance and future outlook. The company slashed its workforce and soon sold itself (after a prospective merger with Columbia House fell through) to German media giant Bertelsmann in the summer of 2000 for $117 million. The brand later ended up with Amazon, and gradually faded away.

Mike Krupit, currently COO at startup Real Food Works, was serving in a CIO/CTO role for CDNow at the time of the IPO. He soon afterwards became COO and later CEO after Bertelsmann took over. He had already seen a couple of companies he had been with go public, including Infonautics. I asked him by email what things were like for CDNow at the time of its IPO. His response:

"CDNow was one of the first dotcom and ecommerce companies to go public. Obviously, we were thrilled to be able to put the money in the bank and have [it] to invest in our growth. But we also knew it didn't guarantee our success. It was tremendously exciting for the team, [though] as you'd imagine, the honeymoon doesn't last too long."

"Culturally, it's a double-edged sword. The expectations of the IPO isn't always met by the reality. The dream of the value of our equity is now something easily calculated. When the stock is up - great; when not, demotivating. We also had to stop sharing lots of information with the team. A lot of healthy chatter had to stop by being a publicly-traded company, which was a big change to CDNOW's startup culture."

Krupit told Technically Philly last summer that what ultimately killed the company was the planned merger with Columbia House; CDNow focused much of its resources on that and when it fell through there wasn't much of a backup plan.




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From 2011: More on USA Technologies CEO George Jensen's suspension: Message Board Wars

Ed note:
Reposting just to point out USA Technologies' past indiscretion, when founder and CEO George P.Jenkins resigned in 2011 over his  repeatedly pumping USAT shares on the Yahoo Finance message board for USAT.,  under a screen name that didn't reveal his name or position. Not sure what the correlation is between 2011 and today's problems, if any. One constant is current CEO Stephen Herbert, who was President/COO in 2011 before succeeding Jensen, also serving as chairman. A new outside chairman, Albin Moschner, took that position in January 2019 after being on the board since 2012, replacing Herbert, who remains CEO.

"Pressure to achieve sales targets gave rise to the premature and/or inappropriate recognition of revenues and reporting of connections [to USAT’s payment network] associated with certain of the examined transactions, typically occurring at or near the end of financial reporting periods,” the company said in a recent filing with the Securities and Exchange Commission.

I have used the product, and it works well. One thought is that the vending business is controlled by shady operators in some areas of the country.

See USA Technologies gets dumped by auditor, loses half its value today"> #USAT">


Tom Paine


The announcement by Malvern-based USA Technologies on Wednesday that its chairman & CEO George Jensen has been suspended and is expected to resign from the company "in the near future" for posts he made to an internet message board naturally raises the questions: what did he post, and to which message board did he post it?

No further definitive information has come out about this that I've been able to find, although some posters at the Yahoo Finance message board for USA Technologies (USAT) have speculated about whether Jensen was one of the posters there. Yahoo Finance message boards are well known, particularly in the case of thinly traded stocks, for having some participants who might "pump the stock", perhaps having a personal interest in it or representing someone else's interest, or others who might try to depress a stock (although there is nothing at this time to suggest that was the case here, nor am I implying it). They are not good places to go for investment advice in general, although there may be some nuggets of truth. These boards can also evolve into platforms for bitter, sometimes personal attacks on company management, as was the case with Mr. Jensen.

Last year USA Technologies became so upset with some critical posters on the Yahoo board that it filed suit in Pennsylvania against two of them, claiming defamation and securities fraud, and alleging they had financial interests in denigrating the company. The company speculated that the posters may have had ties to a dissident shareholder group that was trying to initiate a proxy fight around that time. One of them, who posted under the name "Stokklerk", went to Federal Court in California to quash a subpoena requiring Yahoo to reveal his (or her) true identity. Stokklerk had called Jensen on the board a"known liar" who believes "humanity exists to be fleeced", among other things. A District Judge in San Francisco rejected the company's request, saying that a target of anonymous online attacks must have evidence that the postings violated its rights and caused serious harm before enforcing a subpoena. Stokklerk still posts on the Yahoo board.

Although USA Technologies has made some financial progress in recent years, it has a long history of losses and doubts remain about how it will fare against competing technologies. In its fiscal year ending June 30, USA Technologies lost about $6.5 million on revenue of just under $23 million.



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Today in Philly Tech History 1/29: Thomas Paine Day

Tom Paine

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Wonder what Paine would have thought of  skateboarding?

Today is Thomas Paine Day, also known as Freethinkers Day. It also might be his birthday, though there's some question about that.

Thomas Paine (1737-1809) arrived in America in 1774 at Benjamin Franklin's urging. He was not a politician but a polemicist whose writings lit a fire under the revolution. He later went to France during its revolution, and according to accounts was once marked for the guillotine. (He had a hard time staying out of trouble.)

He was forward thinking in so many regards. Paine was a passionate advocate against slavery, and promoted the concept of trade guilds in Philadelphia, a forerunner to unions.

He had trouble obtaining and keeping money, and if I remember correctly he invested in a bad venture deal; too bad First Round Capital wasn't around then. He lived his later years in New Rochelle, and died in Greenwich Village. When his body was returned to New Rochelle for burial, the Quakers (the faith of his family) wouldn't bury him because of his anti-religious writings (he was, gasp!, a deist), so he was buried on his farm.

There are questions to this daya as to where various parts of his body are located.

When you look at the historical record, Paine didn't really live in Philly for that long.

But his 'free thinking' set an example for what Philadelphia has become today.

Actually, I think his remarkable and crazy life would provide better gist for a musical then, say, Hamilton's.

USA Technologies gets dumped by auditor, loses half its value today #USAT

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USA Technologies (NASDAQ: USAT) lost half its value today when its external audit firm, RSM US LLP, informed its board's audit committee that it was resigning from the account:

"RSM indicated in its letter to the audit committee that, based on the totality of the information, it had concluded in its professional judgment that it can no longer rely on management representations in connection with the audit of the Company’s 2017 internal control over financial reporting and consolidated financial statements," USAT said in an SEC filing .

"The Company anticipates that it will file the restated financial statements for the affected fiscal periods as soon as practicable. The Company is also working diligently to complete and file the Annual Report on Form 10-K for the fiscal year ended June 30, 2018 and the Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2018 as soon as practicable."

USAT shares, which had already been knocked down by news of the accounting issues, fell another 50% today, leaving the company with a market cap of $204 million.

The board claims that RSM had not previously notified the audit committee of its concerns:

"During the last two fiscal years of the Company, and the subsequent period through February 1, 2019, and except as stated in the letter from RSM to the Audit Committee, there were no disagreements with RSM on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of RSM, would have caused RSM to make reference to the subject matter of the disagreements in their reports."

Leading area tech firm EPAM joins up with Ben Franklin on new regional investment fund

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This morning, Ben Franklin Technology Partners (BFTP) of Southeastern Pennsylvania announced it has formed a regional venture fund that allows private investors to invest in a broad variety of early-stage technology-focused enterprises located in the Greater Philadelphia region.

The Global Opportunity Philadelphia Fund's (GO Philly Fund) first investor is Newtown-based EPAM Systems (NYSE: EPAM), a global supplier of IT services to enterprises. EPAM has raised $15 million in its first close and seeks to provide up to $50 million of capital alongside Ben Franklin’s investments. The GO Philly Fund will primarily operate as a co-investment fund with Ben Franklin. It will invest alongside Ben Franklin in early-stage investments that complete and satisfy Ben Franklin’s due diligence process. The fund will seek to make initial investments of between $50,000 and $500,000, and follow-on investments up to $3 million, well beyond BFTP's usual range.

Other accredited investors have already committed to participation in the fund including Provco Group, Fulton Bank, and SRI Capital. KPMG, Bridge Bank and Securitize will support the fund’s operations, while Pepper Hamilton and White and Williams will provide legal support.

Following its initial close, the GO Philly Fund will seek to leverage blockchain technology as part of its fund raising and capital management strategy, with a goal being to facilitate investment from others spread around the globe.

EPAM has been a remarkable success story. Co-founded by one-time SAP employee Arkadiy Dobkin in Princeton (his apartment) and Minsk, EPAM has grown to have revenue of more than $1.8 billion, a market cap of almost $8 billion, and over 25,000 employees. Traditionally, the bulk of its developers are based in eastern Europe. While most of the Asian systems integrators have hit a growth wall, EPAM has moved ahead with consistent growth by generally developing higher value-added enterprise relationships.

“For over 25 years, EPAM has helped established, technology-driven enterprises and startups build software products and platforms, including many which have become globally recognized leaders in their respective markets. With our participation in the GO Philly Fund, we hope to reach regional startups in their earliest stages, working together with Ben Franklin to help them become the next wave of innovators and disruptors,” explained Arkadiy Dobkin, CEO at EPAM, in a release.


This is a great move by EPAM and BFTP for the region.

Commvault Gets New Leadership: Hammer And Bunte Out, Former Puppet Ceo Mirchandani In

Esther Surden
Publisher & Editor, NJTechWeekly.com

Tinton Falls-based Commvault, a public tech giant that employs more than 2,800 people, announced the appointment of Sanjay Mirchandani as president, CEO and member of the board, effective immediately.

Mirchandani, previously the CEO of Puppet, an Oregon-based IT automation company, replaces Bob Hammer, the retiring president and CEO. Hammer has led the company for more than two decades, growing it to a $3.1 billion market cap.

Al Bunte, who has served alongside Hammer for more than two decades, is stepping down from his role as COO while maintaining his position as a member of the board. Both Hammer and Bunte will remain with the company through the transitional period, with Hammer stepping away on March 31.

Also announced was the appointment of Nick Adamo as chairman of the board, replacing Hammer, who will remain on the board as chairman emeritus; both changes will become effective on April 18.

Adamo became a board member in August last year, following the involvement of activist investor Elliott Management (New York) with Commvault, according to an article by Chris Mellor at BlocksandFiles.com. It was Elliott’s influence that caused Commvault to initiate a restructuring project and agree to Hammer’s resignation last May.

Commvault had planned for this transition for many months, conducting an exhaustive global search for the right person to lead the company. In fact, the search had taken so long, it led some observers to wonder why.

Mirchandani has held senior leadership positions at VMware (Palo Alto, Calif.), Dell EMC (Hopkinton, Mass.) and Microsoft (in Singapore), and has significant expertise in the transformation of IT. At Puppet, he grew the user base of that company’s open-source and commercial solutions to more than 40,000, including 75 percent of the Fortune 100.

In the BlocksandFiles article, Mellor asked Mirchandani why he was interested in Commvault. The answer revealed that the new CEO has ties to New Jersey. “It was time for a change at Puppet, and he wanted to move back to the East coast of the USA; he has family in the New Jersey area, where Commvault is head-quartered,” the article stated.

“Commvault is attractive to Mirchandani because it is a bigger company and in good shape. We asked if it could become a billion dollar company: ‘The space is growing really rapidly. I’m not going to put a number on it just yet. I’m very excited about this space. Infrastructure and applications are coming together’ and ‘data is paramount. We’re in a great position to define that to our customers.’”

In the Asbury Park Press, Michael Diamond noted that Mirchandani isn’t new to the Garden State. He graduated in 1986 from Drew University, in Madison, with a bachelor’s degree in mathematics. He was named to the school’s board of trustees in 2017.

The impact of the change on Commvault’s plans to help transform Fort Monmouth, where it is housed, is unknown. Two years ago, at the company’s 20th anniversary celebration, which we reported on here, Hammer discussed the company’s growth.

Asked if the company had enough space at its headquarters to accommodate the planned growth, Hammer noted that there wasn’t enough space in the building, but that there was enough space on the 55-acre campus.

“We’re not moving. When we built this campus, we built it to triple the size [of our company] on this property.”

Also see: Fort Monmouth tech giant Commvault names new CEO to replace long-time leader Bob Hammer

Commvault announces Mirchandani, a leading IT executive, will replace retiring CEO Hammer



Esther Surden is Publisher and Editor of NJTechWeekly, and a contributor to Philly Tech News. This article originally appeared in NJTechWeekly , and is republished here with her permission.