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Luxury department store Barneys is opening a Beverly Hills head shop with high-end marijuana products, including a $1,500 grinder

Mon, 02/11/2019 - 5:57pm  |  Clusterstock

  • Barneys New York is entering the cannabis industry with the opening of a head shop called The High End in its Beverly Hills store, according to The New York Times.
  • The High End will offer luxe cannabis products, marijuana-inspired jewelry, CBD infused beauty products, and paraphernalia, including a $1,475 pot grinder.
  • The move caters to Barneys' customers who have made cannabis part of their lifestyle, a Barneys executive said in a press release.

Barneys New York is taking its product offerings one step higher. 

The luxury department store is making headway in the cannabis world with the upcoming March debut of its head shop, The High End, in its Beverly Hills location, reported Alex Williams of The New York Times.

"Barneys New York has always been at the forefront of shifts in culture and lifestyle, and cannabis is no exception," said Daniella Vitale, Chief Executive Officer & President of Barneys New York, said in a press release. "Many of our customers have made cannabis a part of their lifestyle, and The High End caters to their needs with extraordinary products and service they experience in every facet of Barneys New York."

That includes a sterling silver $1,475 pot grinder, both organic and gold rolling papers, leather ashtrays and lighters by high-end Italian designer GioBagnara, and a $950 bong, according to Williams and the press release. The Head Shop will also sell jewelry, like grinder necklaces, and CBD-infused beauty and wellness products.

It will also offer luxe cannabis products such as silver vape pens as part of an exclusive collaboration with Beboe, an upscale cannabis company dubbed the "Hermés of marijuana," according to Williams.

Barneys plans to roll out head shops in its other California locations and possibly in New York if recreational cannabis is legalized there, Williams reported. But if you don't live in either state, you can also buy The Head Shop's offerings at Barneys.com, according to the press release.

The Head Shop's aesthetics are supposed to be as elevated as its offerings, more "Malibu home than gritty Venice Beach dispensary, with plenty of glass, patinated brass, and raw marble," as part of its "move to court chillaxed influencers," Williams wrote.

Read more: These execs are leaving behind careers at companies like Coke and Victoria's Secret to tap into the $194 billion marijuana industry

The move comes at a time when the cannabis industry is growing — legal marijuana is set to hit $75 billion in sales by 2030, according to a note from analysts at investment bank Cowen, and could eventually become a bigger market than soda, Business Insider's Jeremey Berke previously reported

And it's not just retailers like Barney's getting involved — executives are stepping down from big retail brands and consumer-packaged-goods companies to tap into the industry, which could become worth $194 billion globally if more countries legalize the drug, Berke reported.

According to Chris Burggraeve, a former executive who founded upscale marijuana brand Toast, strategically crafting a weed store can be a multi-billion dollar opportunity

Read the full New York Times article here »

SEE ALSO: California's recreational cannabis industry is booming — but regulations are posing a unique threat

DON'T MISS: Coca-Cola is reportedly eyeing the legal marijuana industry, and it could soon be a bigger market than soda

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Amazon is acquiring Wi-Fi router company Eero, which helps blanket your entire home with a strong wireless-internet signal (AMZN)

Mon, 02/11/2019 - 5:02pm  |  Clusterstock

  • Amazon is acquiring Eero, the pioneering Wi-Fi router company. Terms of the deal were not disclosed.
  • Eero makes "mesh" Wi-Fi routers, which help blanket even the largest spaces with a strong wireless-internet signal. 
  • It's Amazon's latest big-ticket smart-home acquisition, following home-security companies Blink and Ring.
  • Eero continues to face strong competition from the likes of Netgear, Linksys, and even Google.

Amazon is acquiring the home "mesh" Wi-Fi router company Eero, the companies announced in a press release on Monday.

The deal is the latest indication of Amazon's expansive effort to control the electronic "plumbing" of modern homes and lifestyles, adding to a lineup of Amazon products that includes smart speakers and internet-connected doorbell cameras.

Amazon did not disclose the financial terms of the deal, though it said the deal was subject to "customary closing conditions."

Eero was last valued at $215 million in a Series D funding round in 2017, according to PitchBook. It's backed by firms such as Qualcomm and Shasta Ventures.

The 5-year-old company was one of the pioneers of mesh networking: Rather than relying on one Wi-Fi router to cover an entire home or office, Eero provides customers with several smaller routers. Each Eero Beacon added to the system improves the Wi-Fi coverage by 1,000 square feet, the company said, bringing a strong Wi-Fi signal to all corners of an area — even in the largest of spaces. 

"We are incredibly impressed with the eero team and how quickly they invented a Wi-Fi solution that makes connected devices just work," Dave Limp, senior vice president of Amazon devices and services, said in a statement. "We have a shared vision that the smart home experience can get even easier, and we're committed to continue innovating on behalf of customers."

One Eero router retails at $199, and each range-extending Eero Beacon costs $149. In addition to the routers, Eero offers the Eero Plus cybersecurity service for $99 a year. The service offers customers access to premium tools for password management, secure web browsing, and other perks. 

A spokesperson for Amazon says that Eero will continue to support the routers after the acquisition, as before. The company also says that it has no plans to track customer web usage via the Eero router. 

It's easy to see where this might fit in with Amazon's larger plans. Amazon's flagship line of Echo smart speakers relies on Wi-Fi to function, and Ring and Blink, which the company recently acquired, both make a wide range of Wi-Fi-connected home-security gear. By acquiring Eero, Amazon gets to add another layer to its line of smart-home products. 

At the same time, Eero continues to face stiff competition in the router market. Heavyweights such as Netgear and Linksys have followed in Eero's footsteps by releasing their own mesh routers, and even Google has its own Google Wi-Fi mesh-networking product. 

Eero has encountered some turbulence, as well. In January 2018, TechCrunch reported that Eero laid off 30 employees, representing about 20% of its workforce at the time. 

SEE ALSO: Here's the complete timeline of the feud between Jeff Bezos and the National Enquirer, including the ties to President Trump

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NOW WATCH: I quit texting for a week and it was harder than I expected

An NYSE exec who spent a week resisting email for 7 hours a day quickly caved to her inbox, but took away a productivity strategy she uses to this day

Mon, 02/11/2019 - 4:33pm  |  Clusterstock

  • Betty Liu, an executive at the New York Stock Exchange, once tried an experiment in which she didn't check her email from 10 a.m. to 5 p.m.
  • The experiment caused her to stay up late responding to the huge backlog of emails, and she abandoned it after one week.
  • She did pick up one good habit from the productivity experiment: keeping a to-do list of emails to send and writing them all at once.

The average office worker receives more than 100 emails a day, and replying to every one of them could easily waste hours of your day.

But when one entrepreneur tried a radical trick to reduce her email time and increase her productivity, she found it was just too hard of a habit to keep up.

Betty Liu, the executive vice chairman of the New York Stock Exchange, said that for one week in 2016, she refrained from checking her email between the hours of 10 a.m. and 5 p.m.

"It definitely helped, but it wasn't as much the resounding success as I thought it would be," Liu told Business Insider. "I think I felt there were moments if I wasn't on email, something would have just turned out very bad. So I think the aspiration was better than the reality of it."

Read more: A New York Stock Exchange exec uses the '1-3-5 rule' to eliminate lingering guilt over an unfinished to-do list

Liu said she got the idea from Tom Patterson, the founder and CEO of the underwear company Tommy John, whom she had recently interviewed for her company Radiate, an online library of educational videos about leadership and management. At the time, Liu was also an anchor for Bloomberg TV.

Patterson told Liu that when people email him during work hours, he simply doesn't read them. Instead, they get an automated response that says, "I am currently checking email before 9 a.m. and after 5 p.m. EST so there will be a delayed response. If this is urgent please call or text."

"It's been great for people who know that I won't respond for a certain period of time," Patterson told Liu, she said in an article for Inc. "It makes people more comfortable. They stop wondering 'Did he get the email?' or 'Did it go to spam?' There's more certainty."

But when Liu tried the experiment herself, she encountered trouble right off the bat.

On the first day, although she did manage to go the full seven hours without checking her inbox, she discovered a "daunting" number of messages waiting for her when the clock struck 5 p.m. She wrote in a LinkedIn post that she didn't finishing replying to them all until 10:48 p.m.

Worse yet, to outside observers, her absence from email chains made it look like she was slacking off.

"One of my colleagues asks if I’m enjoying my 'mani-pedi' time. It’s funny how people equate not answering your emails with goofing off all day," she wrote.

On another day, once the 5 p.m. moratorium was lifted, she got so caught up responding to the backlog of messages that she missed a phone call she had scheduled. Later, after she went to dinner, she said she felt too tired to respond to more emails, so she had to put them off until the following day, adding to growing pileup.

Another day that week was "a total fail," she said, as she had to "put out fires" all morning via email. Things only snowballed from there.

"Once I started to check email, I started to check social media," she wrote on LinkedIn. "It's as if my fingers automatically open up these apps once I touch my phone."

That morning underscored one of the downsides to the experiment: Even though her automated email response told people to call or text her if the situation was urgent, very few of them did. In one case, an employee who sent an email didn't realize the seriousness of their problem. It taught Liu that "urgency is subjective," she said.

Although not checking her email during work hours was too hard of a habit to keep up, Liu did come out of the experiment with a helpful practice. Whenever Liu thinks to email someone, instead of stopping what she's doing to type it out, she'll put it on her email to-do list. Then, at the end of the day, she can bang out her list of emails at once, increasing her efficiency and reducing fatigue.

Liu has long since abandoned the email experiment, but to this day, she said she puts her phone down "for a few moments each day" to observe the world around her.

"You can waste a lot of time answering and waiting for emails," she said. "Watching the outside world or feeling unhinged from your phone can be exhilarating."

SEE ALSO: A New York Stock Exchange exec uses the '1-3-5 rule' to eliminate lingering guilt over an unfinished to-do list

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Your multivitamins and brain-boosting pills may be suspect, and regulators are cracking down on the $40 billion industry

Mon, 02/11/2019 - 4:30pm  |  Clusterstock

  • This week, federal regulators announced they'll be taking a more active role in policing the more than $40 billion supplement industry.
  • From vitamins to specialized supplements for improved focus and weight loss, some formulations have been tied to serious health risks.
  • The vast majority of supplements and vitamins have little to no strong science behind them, but the space is booming for startups — especially in Los Angeles and Silicon Valley.

Vitamins are supposed to be good for you. But if recent research is any indication, the pricey pills and powders may offer more of a health risk than a nutritional boost.

From vitamins to specialized supplements for improved focus and weight loss, several formulations have been tied abnormal heart rhythms, worsened asthma symptoms, and even death.

So as of this week, federal regulators will be taking a more proactive role in policing the more than $40 billion industry, which has continued to blossom in recent months with the entrance of new startups. 

On Monday, Scott Gottlieb, the head of the Food and Drug Administration (FDA), announced a series of steps his agency would take in coming months to crack down on manufacturers that tout the ability of their formulas to do everything from increase energy to cure cancer. Of particular concern, he said in a statement, are pills that claim to treat Alzheimer’s, a serious brain disease that hinders memory and has no cure.

Dietary supplements "cannot claim to prevent, treat, or cure diseases like Alzheimer’s," Gottlieb wrote. "Such claims can harm patients."

On Monday, the FDA said it sent warnings or advisory letters to 17 companies for illegally selling products that claim to treat Alzheimer's disease.

Other, less niche supplements may be equally risky, according to a recent Business Insider review of dozens of "wellness" formulations that include multivitamins, weight-loss pills, and energy formulas.

Read more: The $37 billion supplement industry is barely regulated — and it's allowing dangerous products to slip through the cracks

The vast majority of supplements and vitamins have little to no strong science behind them, the review found. Yet a new startup peddling the pills seems to emerge every few months.

A new generation of supplements is emerging in Los Angeles and Silicon Valley

When supplements were introduced in the 1930s, they were presented as a way to address serious nutritional deficiencies that caused illnesses such as rickets and scurvy. 

But in recent years, a new generation of supplements has emerged. Most of them are being pioneered by a handful of California startups in areas including Los Angeles and Silicon Valley. The companies' advertisements ooze with recent lifestyle buzzwords such as minimalism ("Everything you need and nothing you don't!"), bright colors, "clean eating," and personalization. They often target specific demographics, such as people who consider themselves overweight, and sometimes vulnerable populations, such as older people at risk for Alzheimer's and other forms of dementia.

There's little to no evidence that any of these pills or gummies actually improve your health. Last month, the authors of a new paper published in the Journal of the American Medical Association concluded that most of the supplements that claim to help prevent Alzheimer's or improve memory actually do nothing of the sort.

Read more: New evidence suggests that most vitamins are useless. Here are the only ones you should take.

"No known dietary supplement prevents cognitive decline or dementia, yet supplements advertised as such are widely available and appear to gain legitimacy when sold by major US retailers," they wrote.

The authors of a recent study published in the New England Journal of Medicine found that supplements — especially those advertised for weight loss — may send some 23,000 people to emergency rooms every year. And between 2000 and 2012, the annual rate of negative reactions to supplements rose 166%, they found.

The researchers behind another recent supplement study found that over the same 12-year period, 34 people died after using pills and powders for weight loss and sexual performance. Six of the deaths resulted from the banned weight-loss supplement ephedra, and one person died after using yohimbe, an herbal supplement used for weight loss and erectile dysfunction. 

How the FDA is cracking down

With any multivitamin or supplement, experts advise caution because none of these products has been approved as medications by the FDA. Their risks can include allergic reactions, changes to normal heart rhythms, and even a heightened risk of serious diseases, such as cancer. Their potential benefits, such as increased energy and improved digestion, may not be worth it. 

This week, the FDA said it sent a series of warning letters to companies that are illegally selling nearly 60 products. Many of them are sold as unapproved or misbranded drugs that claim to treat or cure diseases. 

"These products, which are often sold on websites and social media platforms, have not been reviewed by the FDA and are not proven safe and effective to treat the diseases and health conditions they claim to treat," Gottlieb wrote in a separate statement on Monday.

The items include tablets, capsules, and oils, and are made by companies such as Pure Nootropics, DK Vitamins, and TEK Naturals, according to letters posted on the FDA's website.

Pure Nootropics said it is developing a plan to fix the issues raised by the FDA.

"We will act swiftly to update our website to be in compliance with all applicable rules & regulations," the company said in an email. 

TEK Naturals said it's in touch with the FDA and "committed to compliance with all legal requirements."

The companies must respond to the FDA within 15 days by outlining their plans to address the issues cited in the letters. If they don't, the products can be seized, Gottlieb said. 

"Health fraud scams prey on vulnerable populations, waste money, and often delay proper medical care — and we will continue to take action to protect patients and caregivers from misleading, unproven products," Gottlieb said.

SEE ALSO: The $37 billion supplement industry is barely regulated — and it's allowing dangerous products to slip through the cracks

DON'T MISS: New evidence suggests that most vitamins are useless, but here are the only ones you should take

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We drove an $87,000 Jaguar I-PACE to see how it compares with a $57,500 Tesla Model 3 and a $150,000 Model X. Here's the verdict. (TSLA)

Mon, 02/11/2019 - 4:17pm  |  Clusterstock

  • I've driven the Tesla Model 3 sedan, the Jaguar I-PACE compact crossover, and the Tesla Model X three-row SUV.
  • The vehicles vary quite a bit in capabilities, appointments, and price.
  • But in the end, I think the Tesla Model 3 is the best car.

This is going to be a slightly unusual comparison, but it isn't my fault.

As I've noted before, Tesla has a segmentation problem. Here at Business Insider, when we want to match up compact crossover SUVs, we can find two similar vehicles from different brands. But when it comes to all-electric cars, it's a different story.

The Tesla Model 3, for example, could take on the Chevy Bolt — and I have compared the vehicles. But the Bolt is the only true long-range EV on the market for under $40,000. Tesla isn't yet making the $35,000 version of the Model 3, so you have to point out that the available Model 3 is a premium/luxury car while the Bolt is a mass-market offering.

A larger issue is that because Tesla is selling only three vehicles and has to tweak them in various ways — amenities, self-driving system, total range — to serve buyers at different economic levels, it's challenging to manage good direct comparisons with anybody else's cars.

Making matters even trickier will be the arrival of a bunch of EVs from luxury automakers over the next few years: the Porsche Taycan, the Audi E-Tron, the Mercedes EQC, and so on. Everybody is kind of doing their own thing.

The Jaguar I-PACE, which we sampled last year, is a case in point. The Tesla vehicle it should match up against is the forthcoming Model Y crossover, but that isn't yet being produced. Still, the I-PACE is on sale, so if you're shopping electric, chances are you'll give it a look.

So here's the idea: I'll compare the Jag with the Model 3, which is cheaper, and the Model X, which is pricier. I know which vehicle I like best, but I'll try to set it up so you can make the best choice for your needs.

FOLLOW US: On Facebook for more car and transportation content!

First up: the 2019 Jaguar I-PACE EV400 HSE in "Corris gray." The 2019 Jaguar I-PACE starts at $69,500, while the top-spec HSE variant starts at $80,500. With options and fees, our test car came to $86,720.

Read the review.



Jaguars are supposed to be beautiful cars. The I-PACE looks nice. But beautiful? Not in my book. However, it is poised, powerful, and sleek.

"The I-PACE utilizes a design principle called cab forward, which pushes the cabin towards the front of the car while moving the wheels to the far corners," Ben Zhang said when he reviewed the vehicle.



The leaping cat is front and center.

See the rest of the story at Business Insider

An $82 million penthouse in NYC's tallest residential building finally sold after 2 years on the market — but only after it was split in half and got a $21 million price chop

Mon, 02/11/2019 - 3:45pm  |  Clusterstock

  • An $82 million penthouse in New York City's tallest residential building has finally sold after sitting on the market for more than two years.
  • It sold after it was split into two separate units and was given a $21 million price total price cut.
  • The split units sold for $30.7 million and $30.2 million respectively.
  • The luxury 95th-floor apartment, with its 10-by-10-foot windows, offers 360-degree views of Central Park and the city.

A lavish $82 million penthouse in New York City's tallest residential building has finally sold after sitting on the market for more than two years — but only after it got a $21 million price chop and was split into two separate units.

The developers split up the 95th floor penthouse at 432 Park Avenue, which includes stunning 360-degree views of Central Park and the city, into two apartments, in December 2018, as Curbed reported.

The floor was then re-listed as two individual three-bedroom condos priced at $41.25 million and $40.75 million. Now, they're both sold, at $30.7 million and $30.2 million respectively, a representative for the developer told Business Insider. Penthouse 95A was bought at the end of 2018 for $30.7 million and 95B was later sold for $30.2 million.

The split of the original penthouse and subsequent sales fits into a larger trend of developers chopping up pricey penthouses into smaller, cheaper units in order to get them off the market, Business Insider previously reported. 

Although the two units are called penthouses, they're not actually on the top floor of 432 Park. That would be the 96th-floor unit, which was sold to the Saudi billionaire Fawaz Alhokair for $87.7 million in 2016. Floors 91 through 96 are referred to as penthouses at 432 Park Ave because their layouts are different from the rest of the building and some are full floors, a representative told Business Insider.

Business Insider obtained photos of the penthouse on the 92nd floor (which has been sold), whose layout is identical to the previously one-unit penthouse on the 95th floor, to offer a peek inside the luxurious penthouse apartments. 

Here's a look at the 95th-floor penthouse before it was split in half.

SEE ALSO: I visited a micro-hotel in NYC, where a one-night stay costs more than $300, rooms are half the size of the average hotel, and you have to walk through the bathroom to get to the bed — and it felt way more spacious than I ever expected

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The penthouse is on the 95th floor of 432 Park Ave., the controversial skyscraper that holds the title of tallest residential building in New York City, at 1,396 feet.

One World Trade Center in Lower Manhattan remains the tallest building in the city thanks to its spire, but the skyscraper itself is 28 feet shorter than 432 Park Ave.

Source: New York Times



432 Park was completed in 2015 amid criticism from some New Yorkers who felt it looked ugly and out of place in the city skyline.

Source: New York Times



See the rest of the story at Business Insider

A New York private equity firm founded by JPMorgan and Guggenheim veterans is raising the largest-ever fund dedicated to the booming marijuana industry

Mon, 02/11/2019 - 3:33pm  |  Clusterstock

  • Tuatara Capital, a New York-based private equity fund, is raising $375 million for its second marijuana-focused fund, according to SEC filings.
  • If the firm hits its target, it will be one of the largest pools of capital dedicated to the booming cannabis industry.
  • Chief Investment Officer Al Foreman said in an interview Tuatara's Fund II will rely on the firm's long history operating in the nascent sector.

Tuatara Capital, a New York City-based private equity fund founded by Wall Street veterans, is raising what could be one of the largest pools of capital dedicated to the booming marijuana industry.

The firm is trying to raise as much as $375 million for its second marijuana-focused fund. It's already raised $161.2 million of that as of February 1, according to a filing with the Securities and Exchange Commission.

The firm declined to comment on the specifics of its fundraising activity. 

Tuatara was co-founded in 2014 by a trio of Wall Street veterans. The partners include chief investment officer Al Foreman who's a former private equity banker and executive at JPMorgan, chairman Mark Zittman, formerly of Guggenheim Partners' capital markets division, and chief operating officer Marc Riiska, who has worked at a number of venture capital and software firms.

Read more: Biotech, CBD drinks, and a hot vape company: Here's where all the top marijuana VCs are looking to write checks this year

Foreman said in an interview that the new fund will rely on the "five years of institutional knowledge we've built up operating in the space." (Five years, in a brand new industry like cannabis, is a long time). 

The firm's second fund will be a lot larger than its first. Tuatara raised $93 million for its first fund, which closed in 2016, and has backed eight portfolio companies — soon to be nine, according to Foreman — including marijuana brands like Willie's Reserve, as well as biotech startups like Teewinot Life Sciences, which is developing patents for the production of cannabinoids for pharmaceutical applications.

Foreman believes that the cannabis industry will segment broadly into four distinct markets as it matures: "social consumption," or recreational use, cannabinoid pharmaceuticals, cannabinoid health and wellness, and industrial hemp.

"That's the thesis we laid out in 2014, and I would say that our belief in that thesis has been reaffirmed," said Foreman. The firm has also not shied away from "plant-touching" investments despite the US federal government's prohibition on marijuana. 

Bullish on beverages

As the industry evolves, Foreman said Tuatara's second fund will look to make investments into the infrastructure and enterprise technology startups that support the sector. 

The firm also has a "keen eye" on some select international markets, says Foreman, particularly as more countries in Europe and South America introduce legislation to legalize marijuana either medically or recreationally.

"There are attributes of certain markets that are appealing to us, which I probably wouldn't share because it's our secret sauce," said Foreman. 

Read more: The top 12 venture-capital firms making deals in the booming cannabis industry that's set to skyrocket to $75 billion

Another area Foreman is bullish on: beverages formulated with marijuana, the idea being that new consumers will have an easier time drinking a THC or CBD-containing soda or beer, rather than smoking an old-school joint. 

As for where Tuatara likely won't be investing, Foreman says pure play marijuana cultivation is overheated and "set for a correction."

"I think the viewpoint that all cultivation is valuable and all cultivation will be relevant going forward is somewhat myopic," said Foreman. And he adds CBD, the trendy non-psychoactive compound in marijuana that's shown up in products from beauty masks to cupcakes, into the "myopic" category.

Because marijuana is illegal under federal law (barring hemp-derived CBD), most of the capital in the sector comes from smaller dedicated funds rather than more traditional institutional private equity and venture capital funds.

While Tuatara's new fund will make it one of the largest, there are plenty of firms that invest in both early and middle stage startups in the sector.

They include San Francisco-based Poseidon Asset Management, which is raising $75 million for its Fund II, New York City-based Altitude Investment Management, which manages approximately $30 million and is now raising for its second fund, along with 7thirty, Merida Capital, Rose Capital, Casa Verde Capital, Salveo Capital, Cresco Capital Partners, and others. 

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Wealthy people are decking out their homes with underground basketball courts and $500,000 panic rooms, but there's a hidden danger in the trend of customization

Mon, 02/11/2019 - 3:24pm  |  Clusterstock

  • The luxury real-estate market is hitting a point where homes are so over-customized that they're hard to sell.
  • High-end homes in luxury markets like Los Angeles, NYC and the Hamptons, and London are decked out with details like basketball-court basements, bedrooms converted into recording studios, extensive security systems, and $500,000 panic rooms.
  • These homes are being customized by both developers and homeowners.

From underground basketball courts to private recording studios, luxury homes are hitting a point where they're so over-customized that they're hard to sell.

Alec Traub, a Los Angeles-based real-estate agent with Redfin recently told Business Insider that the trend can be seen across wealthy LA neighborhoods including Beverly Hills, Hollywood Hills, and Bel-Air.

"Customization is price dependent: You see more as you go higher in price point," Traub said, noting that the "magic number" where homes start getting highly customized is around $5 million.

These homes are being customized by both developers and homeowners, Traub said.

Read more: Luxury real estate developers are building out elaborate basements for multimillion-dollar mansions, and they include spas, tennis courts, and even ballrooms

Developers, he said, will "add features they think people want or need, but they don't err on the side of caution."

As Business Insider's Hillary Hoffower previously reported, wealthy people are sparing no expense to keep their lives private and secure, whether that means removing their homes from the grid or hiring architects to conceal buildings. And yet, there is, Traub said, a level at which homes become overly privacy- and security-oriented in a buyer's eyes.

"I've seen examples where you walk into a house and every room has a camera," he said. "And not everyone wants that."

Similarly, wine cellars and home gyms, two details developers have been known to add to homes, appeal to a specific buyer, but not every buyer.

Read more: A property developer who's designed multimillion-dollar NYC penthouses says there are 2 major surprises in the luxury real-estate market right now

On top of that, homeowners add their own touches that cater to their personal, professional, and family-based needs.

"You'll see that entire rooms have been blown out to create recording studios," Traub said, "or a whole basement has been turned into a basketball court."

Traub also said that while customization has long been a trend in luxury real estate, it's become particularly prominent as the idea of live-work spaces has evolved. Rather than having separate spaces, the two functions merge into a single space.

Evidence of over-customization hurting a home's chances on the market can be clearly seen in the likes of an $85 million NYC condo that comes with a $2 million construction credit in case the purchaser doesn't like certain layout details. Or the Bel-Air mega-mansion that comes with a 40-seat movie theater, a bowling alley, and a massive candy wall — and which, after two years on the market and a $100 million price cut, is still not selling.

Read more: Nobody wants to buy 'Versailles in Manhattan,' a $19.75 million Upper East Side townhouse that has been on and off the market for 15 years

While prominent in LA, the trend isn't localized to the West Coast — nor is it always visible to the plain eye. As Business Insider's Katie Warren previously reported, luxury real-estate developers are pouring money into basement-level layouts replete with spas, art galleries, and ballrooms in luxury markets like San Francisco, The Hamptons, and London. Similarly, some wealthy homeowners have paid up to $500,000 to install luxe panic rooms in their houses.

Ultimately, the problem with personalized touches in multimillion-dollar homes is that at higher price points, buyers tend to be selective and specific about what they want. As such, highly personalized details don't help homes in resale: They actually hurt them. 

Wealthy buyers, Traub said, "don't want to buy a fairly brand-new home and then put money into it to turn it into what they want. They'll just look at other homes that match their exact wants instead."

"The question isn't 'how much did this cost to build,'" Traub said. "Instead, it becomes 'how much would it cost to have this taken out?'"

SEE ALSO: An LA mega-mansion listed at $250 million in 2017 has had its price slashed by $100 million, and it's still not selling — here's a look inside

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Unity Technologies, the gaming startup worth more than $3 billion, is reportedly planning to go public in 2020

Mon, 02/11/2019 - 3:22pm  |  Clusterstock

  • Unity Technologies is reportedly planning to go public with an IPO in the first half of 2020.
  • Unity is a video game engine used to develop titles for mobile, VR, AR, and traditional consoles. Popular Unity games include "Pokémon Go," "Cuphead," and "Hollow Knight."
  • CEO John Riccitiello says Unity Technologies is currently valued at more than $3 billion and earning about $300 million per year in annual revenue.

Unity Technologies, the startup responsible for one of the most popular video game development engines in the world, is planning to go public in early 2020, based on a report from Cheddar.

An anonymous source told Cheddar that the company is planning its IPO for the first half of 2020. A Unity spokesperson declined Business Insider's request for comment on the report.

Earlier this year, CEO John Riccitiello told Cheddar that Unity Technologies is currently worth more than $3 billion and earns about $300 million a year in revenue.

Unity licenses development software to developers, who use it to build all kinds of games for smartphones and traditional consoles. Popular games built using Unity include "Pokémon Go," "Cuphead," and "Hollow Knight."

The company also generates ad revenue from billions of ads placed within Unity-based mobile games. Unity claims that more than 50% of all newly released mobile games are built using their software. In August 2018, Unity announced an agreement to let Google's AdMob customers run ads through Unity's mobile gaming network, sharing that mobile gamers spend almost 9 billion minutes a day playing games built on Unity.

Read more: The CEO behind 'Pokémon Go' says the company is cash-flow positive as it becomes worth almost $4 billion

But Riccitiello thinks the Unity software could have applications beyond video games. In a September 2018 interview with Business Insider, Riccitello suggested that versatile 3D development suite could be adopted by architects and engineers. He compared the software's possibilities to Adobe's Photoshop, a software that was initially popular in the fashion industry and has grown to be essential in a wide range of fields.

Unity's biggest competitor is Epic Games, the creator of "Fortnite" and the Unreal Engine video game development suite. The Unreal Engine is used to design "Fortnite" and a host of other major games, like "Kingdom Hearts 3" and "Yoshi's Crafted World."

SEE ALSO: One of the leading companies in the video-game business is gunning to take over the enterprise software industry

NOW READ: Unity and Improbable have ended their feud peacefully after a very public battle that involved the creator of 'Fortnite'

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NOW WATCH: Apple forever changed the biggest tech event of the year by not showing up

I revisited my AncestryDNA test 3 years later and found some surprising changes to my results

Mon, 02/11/2019 - 2:39pm  |  Clusterstock

  • I first took Ancestry's DNA test three years ago and found out that my family history was more complex than I initially thought. 
  • In September 2018, Ancestry updated its ethnicity estimates. As part of the update, my results got a lot more specific. 
  • In the updated results, I found out that I'm much more Norwegian than I thought. 

Since 2015, I've been sending my spit in to companies such as 23andMe and AncestryDNA to find out what I can learn from my genes. 

But the journey didn't end when I got my initial reports back. Since then, the tests have been updated, adding new reports in 23andMe's case and new features in Ancestry's case.

Most recently in September 2018, Ancestry did a major update to its ethnicity estimates for its $99 test. Curious to find out how my new results would compare with the ones I got before, I logged back on to the site.

Here's what I found. 

It's been about three years since I first sent my spit over to Ancestry to see what the company could tell me about my heritage. My AncestryDNA kit arrived in the mail in a small box the size of a hardcover book.

When I opened it up, I found a collection tube (and a bag to seal it in once I was done), a set of instructions, and a smaller box to send it all back in.

After a few minutes of dutifully spitting into the collection tube, I was ready to get my sample ready to ship. Following the kit's directions, I placed a special cap on my tube designed to release a chemical solution (the blue stuff on the top) to get — and keep — my spit in tip-top shape for sequencing.

See the rest of the story at Business Insider

The brother of Jeff Bezos' lover is allegedly the one who gave The National Enquirer the Amazon CEO's private texts

Sun, 02/10/2019 - 11:20pm  |  Clusterstock

  • The Daily Beast reports that it was Michael Sanchez, the brother of Amazon CEO Jeff Bezos’ lover, Lauren Sanchez, who obtained the couple’s private text messages and passed them onto The National Enquirer.
  • Citing "multiple sources" at AMI, the tabloid's parent company, The Beast confirmed what AMI had hinted at earlier on Sunday, that a "reliable" source close to both people provided "information."
  • In an extraordinary public statement last week, Bezos blogged that the tabloid was threatening to release the texts as a favour to, or at the behest of, US President Donald Trump.

The brother of Jeff Bezos’ girlfriend, Lauren Sanchez, gave the compromising text messages of a sexual nature to the tabloid National Enquirer, The Daily Beast reports.

The Beast cited "multiple sources" inside the tabloid's parent company as well as another source close to AMI leaders that Michael Sanchez was the source of the compromising texts.

AMI has remained largely silent on the source of the messages that have triggered a political, commercial and nationally moral upheaval but a lawyer for the company strongly hinted at Sanchez’s role during a Sunday morning interview on ABC.

A lawyer for AMI and the tabloid's CEO David Pecker, Elkan Abramowitz, denied the allegations that the tabloid tried to blackmail the Amazon CEO.

"It absolutely is not extortion and not blackmail," Abramowitz, told ABC on Sunday.

"What happened was the story was given to the National Enquirer by a reliable source that had been given information to the National Enquirer for seven years prior to the story. It was a source that was well known to both Mr Bezos and Miss Sanchez."

The Daily Beast reportedly put the question to Sanchez's brother more than half-dozen times. He did not reply.

Earlier, Business Insider's John Haltiwanger reported that Michael Sanchez was already the source of intense speculation regrading the messages.

"(Michael Sanchez) is an avid supporter of President Donald Trump and associate of Trump-linked figures including Carter Page and the recently-indicted Roger Stone, though he denied being involved.

And Abramowitz on Sunday dropped hints that the source was a long time associate of the tabloid.

“Bezos and Ms. Sanchez knew who the source was,” the lawyer said. 

Hitting back at Bezos’ seeming suggestion that the Trump administration and the Enquirer’s ties to Saudi Arabia may have been involved, Abramowitz said the claim was “libel.”

“It was not the White House. It was not Saudi Arabia,” he added referring to Bezos damning post. “And the libel that was going out there slamming AMI was that this was all a political hatchet job sponsored by either a foreign nation or somebody politically in this country.”

In Bezos' open letter , the owner of the Washington Post referred to several motives and characters that could form the outline of a conspiracy. Bezos never explicitly connected the dots himself, but the suggestion was all too clear.

AMI, according to the world's richest man, had alerted him that the Enquirer had a collection of saucy, private images of Bezos and Sanchez. The tabloid threatened to publish them, Bezos said, unless he put out a statement that he and the investigator he hired to look into the Enquirer’s story about his affair “have no knowledge or basis for suggesting that AMI’s coverage was politically motivated or influenced by political forces.”

“If we do not agree to affirmatively publicize that specific lie, they say they will publish the photos, and quickly,” Bezos said .

His blog post went on to outline what he said were efforts by AMI to get him to deny that the tabloid’s sexy exposé of his affair had any political agenda or origin.

According to The Daily Beast, another source  in "extensive communication" with senior leaders at AMI also said that Michael Sanchez was the supplier of the offending texts.

SEE ALSO: Jeff Bezos essentially accused the National Enquirer of having a political motive for exposing his affair, and insinuated a Trump connection

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NOW WATCH: Watch President Trump announce deal to end the government shutdown for 3 weeks

How Getting Fired From My Own Company By VC’s Taught Me To Start Again Without Them - Thompson Aderinkomi

Sun, 02/10/2019 - 8:51pm  |  Timbuktu Chronicles
Thompson Aderinkomi co-founder at Nice Healthcare and Relate writes:
This is the tale of a technology enabled phoenix. This is the tale of the death of a startup. It is the tale of betrayal and survival. It is long. It is a tale of redemption. It is worth the read.

In the year 2011, I was inspired to start a technology-enabled primary care practice that would cut the cost of healthcare in half while 10x-ing the patient experience. I knew a lot about healthcare but nothing about running a clinic. Yet, I knew that I had done harder things and that I could create a better more affordable offering than the then current solutions...[more]

A New Town - Alárò City Lagos #Nigeria https://www.archdaily.com/910999/som-breaks-ground-on-alaro-city-in-nigeria

Sun, 02/10/2019 - 8:22pm  |  Timbuktu Chronicles
Arch Daily reports:
Skidmore, Owings & Merrill have broken ground on Alárò City, a new masterplan development that will connect to Lagos in southwest Nigeria. The mixed-use model community will feature an international trade gateway with a new seaport and airport. Designed for the Lagos State Government and Africa’s largest urban developer Rendeavour, the project is made to boost foreign direct investment to create an economic and cultural hub for West Africa...[more]

An expert says there's only one good time to give your employees feedback, and it's not during a performance review

Sun, 02/10/2019 - 12:40pm  |  Clusterstock

  • Feedback from a boss or a coworker isn't always effective, research suggests — especially if the feedback is negative.
  • Some experts recommend emphasizing an employee's value to the organization while delivering negative feedback.
  • The only truly effective time to give feedback, one expert says, is when a new employee starts, before they have a solid grasp of their job.

I recently read an article on the Cut about why everyone hates performance reviews, despite the fact that we haven't yet come up with a much better alternative.

One bit jumped out at me. "Almost everyone believes feedback is important and useful, but the research says, ehhh, that's not really quite true," Kevin Murphy, chair of work and employment studies at the University of Limerick and co-author of "Performance Appraisal and Management," told the Cut's Katie Heaney. "About a third of the time, feedback makes things better, about a third of the time feedback makes things worse, and about a third of the time it has no effect whatsoever."

Murphy is presumably referring to the results of a 1996 review, published in the journal Psychological Bulletin, that found eyebrow-raising levels of "variability" in the effects of feedback interventions.

As a reporter for Business Insider, I've heard more than a few executives and workplace experts talk about the importance of feedback — from manager to employee, employee to manager, and one employee to another. Apparently, it only rarely works.

Read more: A former Facebook HR exec says many bosses are too uncomfortable to ask people a hugely important question

Interestingly, a more recent working paper, from researchers at Harvard and the University of North Carolina, found that negative feedback is basically ineffective. As study coauthor Paul Green told the Harvard Business Review, "There's an assumption that what motivates people to improve is the realization that they're not as good as they think they are. But in fact, it just makes them go find people who will not shine that light on them."

That is to say, if your coworker says your work is too sloppy, you just might find another coworker to tell you it's impeccable.

And yet the recent trend in human-resources departments across industries appears to be increasing the amount of feedback employees receive. IBM, for example, ditched the annual performance review and replaced it with a real-time feedback app that supposedly encourages casual dialogue between coworkers.

Make sure an employee knows their value to the organization, even when they're being criticized

So does feedback ever work? Murphy told the Cut that feedback is constructive only right after an employee has been hired, before they really understand their job duties.

And in the 1996 review, the researchers propose "designing work or learning environments that encourage trial and error," so that employees can learn the hard way without their manager's interference. To be sure, these environments sound like they'd take time and effort to create — but the potential improvement in employee performance might be worth it.

As for Green, he told the Harvard Business Review that it can be helpful to affirm people's overall importance to the organization — i.e. letting them know their job isn't necessarily in jeopardy — while delivering negative feedback. "It's about accompanying negative feedback with validation of who people are and of their value to the organization," Green said. "And it's not even about providing it all the time. People just need to feel valued."

SEE ALSO: An HR exec who's worked at Starbucks and Coach shares the best way to impress your boss

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NOW WATCH: Understanding this one cognitive bias may help you better negotiate a pay raise

The popular SPG AmEx Card goes away on February 12 — here are 5 reasons to apply for it before it’s too late

Sun, 02/10/2019 - 12:40pm  |  Clusterstock

The Insider Picks team writes about stuff we think you'll like. Business Insider may receive a commission from The Points Guy Affiliate Network.

In February, Marriott is finalizing the merger of its loyalty program with Starwood Preferred Guest's by rebranding the combined program as Marriott Bonvoy. The name hasn't been the most popular, and a few changes to the program have left some former Starwood die-hards less than thrilled. But overall the Bonvoy program still offers great value to Marriott loyalists; following its merger with Starwood, which closed in 2016, Marriott has more locations than any other hotel brand.

The merger has been especially complicated when its come to the rewards credit cards offered under the Marriott and SPG brands. All of the cards are being rebranded, while some are being closed to new applications; although current cardholders will get to keep those cards indefinitely. You can read more about the changes here.

One of the cards that's being closed to new applications is an old favorite in the rewards world: the original Starwood Preferred Guest Card from American Express.

The last day to apply for it is February 12.

Anyone who holds or applies for the card before the cutoff date will be able to keep it — and all of its current perks — when it's renamed the Marriott Bonvoy American Express Card. After that, new applicants looking for the entry-level personal Marriott card will have to apply for the version issued by Chase, soon to be known as the Marriott Bonvoy Boundless Credit Card from Chase.

While the SPG AmEx has similar benefits to the Chase card, it one may be easier to be approved for if you've already opened five credit cards in the past 24 months. There are also a few other compelling reasons to go for the AmEx, including perks, fees, and even aesthetics.

Read on to learn more about the card.

Annual free night

Each year on your card member anniversary, you'll get a free night certificate, which is good at any Marriott hotel that costs up to 35,000 points for an award night. While that rules out most higher-end properties, it still includes a ton of hotels, and can easily outweigh the card's annual fee.

A waived annual fee the first year

Both the SPG AmEx and the Chase Marriott Premier Plus (soon to be re-branded the Marriott Bonvoy Boundless Card) have a reasonable $95 annual fee.

But only the SPG AmEx waives that fee for the first year. That alone makes it compelling to open the card before applications are closed on February 12.

Complimentary Silver elite status

By simply having an open SPG AmEx (or, as it's soon to be known, Bonvoy AmEx) account, you'll automatically get Silver elite status in the Marriott Bonvoy loyalty program.

Silver doesn't get you much, but it's still something — you'll get a 10% bonus on points earned, priority for late checkout, access to a dedicated customer service line, free Wi-Fi, and more. While it's not a published benefit, you may also be given preferential rooms.

If you spend $35,000 on the card in a given year, you'll earn Gold status instead. That gets you a 25% bonus on points earned, complimentary internet during stays, room upgrades based on availability, and a small gift of bonus points at check-in.

Useful rewards, and a large welcome bonus

The SPG AmEx offers 6x points on every dollar spent at Starwood and Marriott hotels, and 2x points on everything else. 

It also offers new cardholders 75,000 points after spending $3,000 in the first three months. That's a useful bonus, and despite some restrictions on eligibility for Chase Marriott bonuses, if you've recently received one from an AmEx Marriott card, you'll still be eligible for the other bonuses later down the line.

Keep in mind that starting February 28, the Chase Marriott Bonvoy Boundless card will have a limited-time, 100,000 point bonus for new card members who spend $5,000 in their first three months. But that requires an extra $2,000 of spend, and the annual fee won't be waived the first year. You also won't be able to be approved by Chase if you've opened five or more cards in the past 24 months.

A cool, unique new look

Obviously, you shouldn't make decisions about credit cards or rewards based on what the card looks like, alone. However, when the card's benefits and terms make it a good fit anyway, aesthetics can make a great bonus.

According to Eva Reda, an executive vice president of global co-brand partnerships at American Express, mural and studio artist Tony "Rubin" Sjöman collaborated with AmEx on the card's new look, which is meant to invoke sunrise reflecting off city buildings with a geometric design inspired by travel and exploration.

Bottom line

This is the last chance — possibly ever — to get the SPG AmEx.

Under the new Bonvoy brand, Chase will be the primary issuer of the brand's mainstream credit card, while the premium and small business credit cards will be American Express' domain.

If the card seems like a good fit, now is the time to apply.

Click here to learn more about the SPG AmEx from Insider Picks' partner: The Points Guy.

SEE ALSO: Big changes are coming to the Marriott and Starwood rewards programs and their credit cards — here’s what you need to know

SEE ALSO: The best credit card rewards, bonuses, and perks of 2019

Join the conversation about this story »

'Lego Movie 2' won an underwhelming weekend at the box office

Sun, 02/10/2019 - 10:52am  |  Clusterstock

  • "The Lego Movie 2" won the weekend box office but performed below industry projections.
  • With hopes of opening in the $50 million range, it only took in $34.4 million.
  • "What Men Want" takes second place with a solid $19 million.

After weeks of Universal's thriller "Glass" topping the domestic box office, there was certainly going to be a change at number one with movies like Warner Bros.' "The Lego Movie 2: The Second Part" and Paramount's "What Men Want" opening this weekend. But the bigger question was if either would attract big audiences.

"The Lego Movie 2" picks up where the 2014 hit left off, but it didn't grab audiences the same way.

"Lego Movie 2" won the weekend box office with a $34.4 million opening on 4,300 screens, but that's nowhere near the original's $69 million opening take, or the projections the industry had for the sequel, which were around $50 million-plus.

You certainly can't blame Rotten Tomatoes for this one. The movie was certified fresh with an 84% rating. The movie also sported an A- CinemaScore. Perhaps Warner Bros. releasing two Lego movies last year — "The Lego Batman Movie" and "The Lego Ninjago Movie" — burnt out audiences.

Coming in second place was the Paramount comedy "What Men Want." The studio stayed realistic in what it could pull off this weekend, placing the Taraji P. Henson movie on only 2,900 screens, but the movie performed well taking in $19 million.

Read more: An "Aquaman" horror spin-off movie is officially in the works about the Trench creatures

Next week will be more of a mixed bag of releases as "Alita: Battle Angel," "Happy Death Day 2U," and "Isn't It Romantic" enter the fray. But the way things are going, it seems audiences are saving their pennies for the first must-see movie of the year, "Captain Marvel," which opens March 8.

SEE ALSO: Marvel made a brilliant 1990s throwback website to promote the new "Captain Marvel" movie

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NOW WATCH: Michael D'Antonio reveals Donald Trump's 'strange' morning ritual that boosts his ego

A $68 million Miami penthouse could shatter Florida's real-estate record, but its building might soon be underwater

Sun, 02/10/2019 - 9:51am  |  Clusterstock

  • A $68 million Miami penthouse could shatter Florida's real-estate record, but it's in a building that's vulnerable to sea-level rise. 
  • The building, called Eighty Seven Park, is at risk of chronic flooding by 2030. 
  • Though Miami sea levels are rising at faster rates than in other areas of the world, the city's developers continue to prioritize luxury waterfront properties. 

No location is completely safe from climate change, but Miami's future looks particularly challenging. 

The city's sea levels are rising at faster rates than in other areas of the world, already resulting in floods, contaminated drinking water, and major damage to homes and roads.

In an April statement to Business Insider, environmental author Jeff Goodell referred to Miami as "the poster child for a major city in big trouble." 

Read more: The next housing crash could be caused by weather, not Wall Street – here are the places that should be worried

That hasn't stopped high-profile architects from rolling out luxury developments in Miami that boast beachfront access and ocean views. 

The latest example is a two-story penthouse that went on the market last year, at an asking price of $68 million. The property comes with two private elevators, a Jacuzzi, a personal fitness center, and 18,000 square feet of outdoor terrace space.

Its building, Eighty Seven Park, was designed by legendary architect Renzo Piano, whose other projects include the Centre Georges Pompidou in Paris, the Shard in London, and the Whitney Museum of American Art in New York City. 

If the penthouse sells for more than $60 million, it could nab the record for the most expensive condo ever sold in Florida. 

But a handful of decades from now, the building could find itself underwater.

A 2018 report from the Union of Concerned Scientists suggested that 12,000 homes in Miami Beach are in danger of chronic flooding within the next 30 years. That puts around $6.4 billion worth of property at risk — the most of any coastal community examined in that report. 

This situation highlights a paradox in the modern real estate market: Waterfront homes often fetch the highest prices, but they're also the most vulnerable to sea-level rise. Even after a major disaster like a hurricane or flood, buyers tend to hold steady in their coastal preferences. 

Scientists say dramatic sea-level rise is inevitable if climate change continues unabated. 

In a 2016 study published in the journal Nature Climate Change, scientist Mathew Hauer examined the risk of sea-level rise in the continental US. His findings showed a "super concentration" of at-risk residents in Florida's Miami-Dade and Broward counties. From 2010 to 2100, Hauer said, these counties could account for one out of every four people affected by sea-level rise in the US. 

If Miami doesn't plan for this disaster scenario, Hauer said, "the price is really, really high."

Last year, Forbes contributor Bill Springer asked David Martin, the CEO of the development company behind Eighty Seven Park, about the threat of flooding in Miami. Martin said he understood the city's "complicated environmental situation," and that his company, Terra, is dealing with it by diversifying its projects and the sites where it builds. 

While it's hard to anticipate the exact amount of sea-level rise coming this century, the US National Ocean Service suggests that global sea levels rise about an eighth of an inch per year. That puts the nation on track to see nearly 6 feet of sea-level rise by 2100. 

Under these conditions, Hauer said, Miami communities could see a severe impact. 

"I'm not sure that [Miami] can adequately plan for 6 feet," he told Business Insider. "It's water level as high as I am."

When he first starting working on his study, Hauer said, 6 feet was considered the highest prediction of sea-level rise by the end of the century.

"Now it’s 10 feet," he said, "which is not good for places like Miami."

SEE ALSO: 30 US cities that could be underwater by 2060

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NOW WATCH: Animated map shows what would happen to Asia if all the Earth's ice melted

The CEO of App Annie, one of Silicon Valley's most popular app data platforms, explains how it completely revamped its culture as it prepares to be IPO-ready

Sun, 02/10/2019 - 7:00am  |  Clusterstock

  • App Annie, the mobile app data analytics startup, is preparing to be IPO-ready, making a play at M&A, private equity or going public in the next two to three years, says Ted Krantz, CEO of App Annie.
  • App Annie, which is often cited in Apple's announcements, has grown quickly, but the biggest challenge has been the company culture, Krantz says.
  • Krantz explains how the company worked to revamp its culture and raise employee engagement in the past few months.

Before taking the reins as CEO of App Annie in July, Ted Krantz recalls the awkward silence in the room during all-hands meetings. 

Employees would sit uncomfortably while executives or managers made presentations, he recalls. No one would ask questions.

"None of us were feeling too great, and that’s inclusive of myself," Krantz said. "We were losing the engagement of our employees."

That was a wake-up call that the company, one of the biggest players in the mobile app data analytics space, needed to change. Employees felt like their voices weren't being heard, and Glassdoor reviews plunged. App Annie embarked on a major reinvention that brought in new executives, replaced old practices, increased company transparency and helped its employees become more involved.

Krantz spoke with Business Insider about how App Annie, the fast-growing app platform that is often cited in Apple's announcements, revitalized its culture from the inside out. It's a work in progress, but he says the positive results are already making a difference.

The cultural turnaround inside App Annie has been one of the company's top priorities that Krantz hopes will put it on solid footing for the next stage, as it moves closer to a possible IPO in the next two to three years. 

"We want to move to the next chapter and move to the next level and focus on innovation, talent and culture," Krantz said.

"They were not feeling like they have a voice"

Last year, App Annie started seeking a new CEO to replace former CEO and co-founder Bertrand Schmitt because it needed to scale. Schmitt was very much involved in the process of transitioning a new CEO, and he still plays a role in helping the company grow.

Read more: This French CEO launched his startup in China — and ended up making one of Silicon Valley's most popular app platforms

Krantz, who had already been serving as App Annie's president and brought in a background of working at Oracle and SAP, was a natural pick. The company desperately needed culture changes, Krantz said.

Successive rounds of layoffs had taken a toll on morale. Although necessary for the company to be more efficient, Krantz said that the cuts put the employee base through "torture" since the company didn't do it the right way the first time, and it ended up being the biggest source of employee dissatisfaction.

"They were not feeling like they have a voice and confused that perhaps what they’re hearing is some orientation of spin-selling," Krantz said. "There’s something behind this that isn’t good."

"We've been a bit naive with assuming they're all right when they're silent"

Krantz had previously worked with SAP CEO Bill McDermott, and he cites McDermott as an inspiration. That company, he said, was known for being a stale corporation, but it made a major culture turnaround and ended up winning a Glassdoor award.

Krantz wanted App Annie to make that turnaround as well. He started with a new company focus on transparency by giving employees the straight-up facts and numbers and allowing employees to draw their own conclusions from the insights.

He worked on describing the company vision in a clearer way to employees and posted its key performance indicators across the company — something the company wasn't doing before and which may have caused some of the mistrust, Krantz said. 

The change in attitude needed to happen at all levels. Instead of denying or brushing off employee feedback, the executive team made sure to respond to employees. Management now organizes meetings to be more town hall style, rather than bombarding employees with slideshow presentations, and they focus on talking to employees, rather than talking at them.

"I do think the listening is key," Krantz said. "That’s been a big takeaway for me. We’ve been a bit naive with assuming they’re all right when they’re silent but it’s the opposite...Before, there was no listening. It was more of, 'here’s what we’re going to do. Here’s why. Are you guys excited? No questions? OK, let’s go.'"

App Annie also started focusing more on career development opportunities for its employees and having managers ask their employees what their goals are. Krantz said this helped with retention as employees felt like they were being heard and there was room for growth.

"We encourage having 1-on-1’s across the organization and try to be sensitive to that especially with our top performers," Krantz said. 

Now that team members are more aware of the roadmap ahead, the company can focus on product innovation. In November, the company launched App Annie Labs, an initiative to accelerate product development by partnering closely with customers and getting their feedback. And App Annie expects a release this coming quarter.

"It's the first big new product offering since I’ve been on the company," Krantz said. "Everyone’s getting a pulse to get things moving. Right now, more differentiation than they’ve had in the last three to four years."

The roadmap ahead

The internal improvements also mean the company is now better equipped to look ahead to the next big milestones. An IPO is possible, but Krantz says it's not the only option. In the next 18 to 36 months, he says, AppAnnie will "make a play" at either a public offering, an acquisition or a private equity deal. 

"I’m not obsessed with an IPO, nor is the board," Krantz told Business Insider. "The dynamics have changed...where it used to be, the gold star is IPO, the second prize is the other options. I don’t think it’s that way anymore. We want to be in a position where we’re growing the company responsibly."

Although App Annie has made progress, Krantz says there's still work to be done, and he probably won't start feeling good about the culture until 2020.

"Culture has definitely been the biggest challenge," Krantz said. "It’s hard to turn the tide. We put so much work, energy and effort into it where I feel like it’s stabilized. We get signs we’re moving into a green zone, but you don’t want to get so excited."

So how are the meetings now? "Now it’s a completely different reality," Krantz said. "We have to extend all-hands and the questions go on for an hour...It's based on trust and an open dialogue. The thing that’s interesting to watch is the boldness of the questions and the challenges that they place."

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SEE ALSO: Google Cloud will help the Golden State Warriors play better basketball

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NOW WATCH: We compared Apple's $159 AirPods to Xiaomi's $30 AirDots and the winner was clear

The Fed may have sparked the latest stock rally, but one expert says it's actually planting the seeds for the next market crash

Sun, 02/10/2019 - 6:05am  |  Clusterstock

  • The stock market has seen a strong recovery since it nearly plunged into bear market territory in late December.
  • Experts attribute this renewed strength to the Federal Reserve's dovish shift in recent weeks — one that's likely to postpone further rate hikes for the foreseeable future.
  • John Hussman — the outspoken investor and former professor who's been predicting a stock collapse — isn't buying it. He explains why current conditions remind him of the environment right before the last two market crashes.

It's no secret that John Hussman isn't exactly a fan of the Federal Reserve.

The former economics professor and renowned market bear has shared choice words about the central bank on multiple occasions before.

His main argument is that the Fed's monetary easing practices have created unsustainable market conditions. By lowering interest rates to near zero, the central bank made it so companies — even those with questionable credit profiles — could have easy access to debt financing.

Hussman — who is currently president of the Hussman Investment Trust —  says the final result has been a "yield-seeking carnival of speculation" that's pushed valuations to their "most offensive extremes in history."

All of this helps explain why Hussman is skeptical of the ongoing stock market rally — one that was catalyzed by the Fed backtracking on its previously stated plan to tighten monetary conditions. Once fearful that equities would lose appeal at the expense of bonds, investors are getting bullish again now that the overhang has been removed.

Hussman warns that this isn't the right mentality to adopt. At the center of that argument are so-called market internals, which are a series of indicators that take the overall pulse of the equity landscape.

According to Hussman, these internals have become "ragged and divergent" over the past few months as volatility has wreaked havoc on stocks. And that, in turn, means the market will react in completely different fashion to the type of Fed stimulus that normally supports it.

"Even a shift to Fed easing typically has no benefit for stocks, aside from a short-lived knee-jerk reaction, unless market internals indicate that investors are inclined toward speculation," Hussman said. "It has very little effect in periods when investors are inclined towards risk aversion."

The chart below shows how powerful monetary policy has been as a market driver during periods when market internals were either favorable or unfavorable.

As you can see — as indicated by the yellow line and highlighted by the red boxes — monetary easing was comparatively ineffective during the periods right before last two financial crises.

You might think this isn't that big of a deal. After all, the nearly 10-year bull market has withstood loads of other negative headwinds in recent years.

But Hussman says it's quite an important development, and that investors would be unwise to ignore these conditions. In fact, the environment right now reminds Hussman of the periods preceding the last two catastrophic stock sell-offs.

"The gradual retreat of Federal Reserve statements toward an easier policy stance is similar to what we observed in January 2001 and again in January 2008, both at the beginning of what would devolve into severe bear market collapses," Hussman said.

Hussman's track record

For the uninitiated, Hussman has repeatedly made headlines by predicting a stock-market decline exceeding 60% and forecasting a full decade of negative equity returns. And as the stock market has continued to grind mostly higher, he's persisted with his calls, undeterred.

But before you dismiss Hussman as a wonky perma-bear, consider his track record, which he breaks down in his latest blog post. Here are the arguments he lays out:

  • Predicted in March 2000 that tech stocks would plunge 83%, then the tech-heavy Nasdaq 100 index lost an "improbably precise" 83% during a period from 2000 to 2002
  • Predicted in 2000 that the S&P 500 would likely see negative total returns over the following decade, which it did
  • Predicted in April 2007 that the S&P 500 could lose 40%, then it lost 55% in the subsequent collapse from 2007 to 2009

In the end, the more evidence Hussman unearths around the stock market's unsustainable conditions, the more worried investors should get. Sure, there may still be returns to be realized in this market cycle, but at what point does the mounting risk of a crash become too unbearable?

That's a question investors will have to answer themselves. And one that Hussman will clearly keep exploring in the interim.

SEE ALSO: Baillie Gifford was an early investor in Amazon, Facebook, and Tesla — here are the stocks and themes the $221 billion firm is betting on for the future

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