Nov
14
2019
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AWS confirms reports it will challenge JEDI contract award to Microsoft

Surely just about everyone was surprised when the Department of Defense last month named Microsoft as the winner of the decade-long, $10 billion JEDI cloud contract — none more so than Amazon, the company everyone assumed all along would be the winner. Today the company confirmed earlier reports that it was challenging the contract award in the Court of Federal Claims.

The Federal Times broke this story.

In a statement, an Amazon spokesperson suggested that there was possible bias and issues in the selection process. “AWS is uniquely experienced and qualified to provide the critical technology the U.S. military needs, and remains committed to supporting the DoD’s modernization efforts. We also believe it’s critical for our country that the government and its elected leaders administer procurements objectively and in a manner that is free from political influence.

“Numerous aspects of the JEDI evaluation process contained clear deficiencies, errors, and unmistakable bias — and it’s important that these matters be examined and rectified,” an Amazon spokesperson told TechCrunch.

It’s certainly worth noting that the president has not hidden his disdain for Amazon CEO and founder Jeff Bezos, who also is owner of The Washington Post newspaper. As I wrote in Even after Microsoft wins, JEDI saga could drag on:

Amazon, for instance, could point to Jim Mattis’ book where he wrote that the president told the then Defense Secretary to “screw Bezos out of that $10 billion contract.” Mattis says he refused, saying he would go by the book, but it certainly leaves the door open to a conflict question.

Oracle also filed a number of protests throughout the process, including one with the Government Accountability Office that was later rejected. It also went to court and the case was dismissed. All of the protests claimed that the process favored Amazon. The end result proved it didn’t.

The president interjected himself in the decision process in August, asking the defense secretary, Mark T. Esper, to investigate once again if the procurement process somehow favored Amazon, and the week the contract was awarded, the White House canceled its subscription to The Washington Post.

In October, the decision finally came and the DOD chose Microsoft . Now Amazon is filing a challenge in federal Court, and the JEDI saga really ain’t over until it’s over.

 

Oct
28
2019
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Even after Microsoft wins, JEDI saga could drag on

The DoD JEDI contract saga came to a thrilling conclusion on Friday afternoon, appropriately enough, with one final plot twist. The presumptive favorite, Amazon, did not win, stunning many, including likely the company itself. In the end, Microsoft took home the $10 billion prize.

This contract was filled with drama from the beginning, given the amount of money involved, the length of the contract, the winner-take-all nature of the deal — and the politics. We can’t forget the politics. This was Washington after all, and Jeff Bezos does own The Washington Post.

Then there was Oracle’s fury throughout the procurement process. The president got involved in August. The current defense secretary recused himself on Wednesday, two days before the decision came down. It was all just so much drama, even the final decision itself, handed down late Friday afternoon — but it’s unclear if this is the end or just another twist in this ongoing tale.

Some perspective on $10 billion

Before we get too crazy about Microsoft getting a $10 billion, 10-year contract, consider that Amazon earned $9 billion last quarter alone in cloud revenue. Microsoft reported $33 billion last quarter in total revenue. It reported around $11 billion in cloud revenue. Synergy Research pegs the current cloud infrastructure market at well over $100 billion annually (and growing).

What we have here is a contract that’s worth a billion a year. What’s more, it’s possible it might not even be worth that much if the government uses one of its out clauses. The deal is actually initially guaranteed for just two years. Then there are a couple of three-year options, with a final two-year option at the end if it gets that far.

The DOD recognized that with the unique nature of this contract, going with a single vendor, it wanted to keep its options open should the tech world shift suddenly under its feet. It didn’t want to be inextricably tied to one company for a decade if that company was suddenly disrupted by someone else. Given the shifting sands of technology, that part of the strategy was a wise one.

Where the value lies

If the value of this deal was not the contract itself, it begs the question, why did everyone want it so badly? The $10 billion JEDI deal was simply a point of entree. If you could modernize the DoD’s infrastructure, the argument goes, chances are you could do the same for other areas of the government. It could open the door for Microsoft for a much more lucrative government cloud business.

But it’s not as though Microsoft didn’t already have a lucrative cloud business. In 2016, for example, the company signed a deal worth almost a billion dollars to help move the entire department to Windows 10. Amazon too, has had its share of government contracts, famously landing the $600 million to build the CIA’s private cloud.

But given all the attention to this deal, it always felt a little different from your standard government contract. Just the fact the DoD used a Star Wars reference for the project acronym drew more attention to the project from the start. Therefore, there was some prestige for the winner of this deal, and Microsoft gets bragging rights this morning, while Amazon is left to ponder what the heck happened. As for other companies like Oracle, who knows how they’re feeling about this outcome.

Hell hath no fury like Oracle scorned

Ah yes, Oracle; this tale would not be complete without discussing the rage of Oracle throughout the JEDI RFP process. Even before the RFP process started, they were complaining about the procurement process. Co-CEO Safra Catz had dinner with the president to complain that the contract process wasn’t fair (not fair!). Then it tried complaining to the Government Accountability Office. They found no issue with the process.

They went to court. The judge dismissed their claims that involved both the procurement process and that a former Amazon employee, who was hired by the DoD, was involved in the process of creating the RFP. They claimed that the former employee was proof that the deal was tilted toward Amazon. The judge disagreed and dismissed their complaints.

What Oracle could never admit was that it simply didn’t have the same cloud chops as Microsoft and Amazon, the two finalists. It couldn’t be that they were late to the cloud or had a fraction of the market share that Amazon and Microsoft had. It had to be the process or that someone was boxing them out.

What Microsoft brings to the table

Outside of the politics of this decision (which we will get to shortly), Microsoft brought to the table some experience and tooling that certainly gave it some advantage in the selection process. Until we see the reasons for the selections, it’s hard to know exactly why the DoD chose Microsoft, but we know a few things.

First of all there are the existing contracts with the DoD, including the aforementioned Windows 10 contract and a five-year $1.76 billion contract with DoD Intelligence to provide “innovative enterprise services” to the DoD.

Then there is Azure Stack, a portable private cloud stack that the military could stand up anywhere. It could have great utility for missions in the field when communicating with a cloud server could be problematic.

Fool if you think it’s over

So that’s that right? The decision has been made and it’s time to move on. Amazon will go home and lick its wounds. Microsoft gets bragging rights and we’re good. Actually, this might not be where it ends at all.

Amazon, for instance, could point to Jim Mattis’ book where he wrote that the president told the then Defense Secretary to “screw Bezos out of that $10 billion contract.” Mattis says he refused, saying he would go by the book, but it certainly leaves the door open to a conflict question.

It’s also worth pointing out that Jeff Bezos owns The Washington Post and the president isn’t exactly in love with that particular publication. In fact, this week, the White House canceled its subscription and encouraged other government agencies to do so as well.

Then there is the matter of current Defense Secretary Mark Espers suddenly recusing himself last Wednesday afternoon based on a minor point that one of his adult children works at IBM (in a non-cloud consulting job). He claimed he wanted to remove any hint of conflict of interest, but at this point in the process, it was down to Microsoft and Amazon. IBM wasn’t even involved.

If Amazon wanted to protest this decision, it seems it would have much more solid ground to do so than Oracle ever had. An Amazon spokesperson would only say that the company “was keeping its options open.”

The bottom line is a decision has been made, at least for now, but this process has been rife with controversy from the start, just by the design of the project, so it wouldn’t be surprising to see Amazon take some protest action of its own. It seems oddly appropriate.

Oct
11
2019
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Descartes Labs snaps up $20M more for its AI-based geospatial imagery analytics platform

Satellite imagery holds a wealth of information that could be useful for industries, science and humanitarian causes, but one big and persistent challenge with it has been a lack of effective ways to tap that disparate data for specific ends.

That’s created a demand for better analytics, and now, one of the startups that has been building solutions to do just that is announcing a round of funding as it gears up for expansion. Descartes Labs, a geospatial imagery analytics startup out of Santa Fe, New Mexico, is today announcing that it has closed a $20 million round of funding, money that CEO and founder Mark Johnson described to me as a bridge round ahead of the startup closing and announcing a larger growth round.

The funding is being led by Union Grove Venture Partners, with Ajax Strategies, Crosslink Capital, and March Capital Partners (which led its previous round) also participating. It brings the total raised by Descartes Labs to $60 million, and while Johnson said the startup would not be disclosing its valuation, PitchBook notes that it is $220 million ($200 million pre-money in this round).

As a point of comparison, another startup in the area of geospatial analytics, Orbital Insight, is reportedly now raising money at a $430 million valuation (that data is from January of this year, and we’ve contacted the company to see if it ever closed).

Santa Fe — a city popular with retirees that counts tourism as its biggest industry — is an unlikely place to find a tech startup. Descartes Labs’ presence there is a result of that fact that it is a spinoff from the Los Alamos National Laboratory near the city.

Johnson — who had lived in San Francisco before coming to Santa Fe to help create Descartes Labs (his previous experience building Zite for media, he said, led the Los Alamos scientists to first conceive of the Descartes Labs IP as the basis of a kind of search engine) — admitted that he never thought the company would stay headquartered there beyond a short initial phase of growth of six months.

However, it turned out that the trends around more distributed workforces (and cloud computing to enable that), engineers looking for employment alternatives to living in pricey San Francisco, plus the heated competition for talent you get in the Valley all came together in a perfect storm that helped Descartes Labs establish and thrive on its home turf.

Descartes Labs — named after the seminal philosopher/mathematician Rene Descartes — describes itself as a “data refinery”. By this, it means it injests a lot of imagery and unstructured data related to the earth that is picked up primarily by satellites but also other sensors (Johnson notes that its sources include data from publicly available satellites; data from NASA and the European space agency, and data from the companies themselves); applies AI-based techniques including computer vision analysis and machine learning to make sense of the sometimes-grainy imagery; and distills and orders it to create insights into what is going on down below, and how that is likely to evolve.

Screenshot 2019 10 11 at 13.26.33

This includes not just what is happening on the surface of the earth, but also in the air above it: Descartes Labs has worked on projects to detect levels of methane gas in oil fields, the spread of wildfires, and how crops might grow in a particular area, and the impact of weather patterns on it all.

It has produced work for a range of clients that have included governments (the methane detection, pictured above, was commissioned as part of New Mexico’s effort to reduce greenhouse gas emissions), energy giants and industrial agribusiness, and traders.

“The idea is to help them take advantage of all the new data going online,” Johnson said, noting that this can help, for example, bankers forecast how much a commodity will trade for, or the effect of a change in soil composition on a crop.

The fact that Descartes Labs’ work has connected it with the energy industry gives an interesting twist to the use of the phrase “data refinery”. But in case you were wondering, Johnson said that the company goes through a process of vetting potential customers to determine if the data Descartes Labs provides to them is for a positive end, or not.

“We have a deep belief that we can help them become more efficient,” he said. “Those looking at earth data are doing so because they care about the planet and are working to try to become more sustainable.”

Johnson also said (in answer to my question about it) that so far, there haven’t been any instances where the startup has been prohibited to work with any customers or countries, but you could imagine how — in this day of data being ‘the new oil’ and the fulcrum of power — that could potentially be an issue. (Related to this: Orbital Insight counts In-Q-Tel, the CIA’s venture arm, as one of its backers.)

Looking ahead, the company is building what it describes as a “digital twin” of the earth, the idea being that in doing so it can better model the imagery that it injests and link up data from different regions more seamlessly (since, after all, a climatic event in one part of the world inevitably impacts another). Notably, “digital twinning” is a common concept that we see applied in other AI-based enterprises to better predict activity: this is the approach that, for example, Forward Networks takes when building models of an enterprise’s network to determine how apps will behave and identify the reasons behind an outage.

In addition to the funding round, Descartes Labs named Phil Fraher its new CFO, and is announcing Veery Maxwell, Director for Energy Innovation and Patrick Cairns, who co-founded UGVP, as new board observers.

Oct
08
2019
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Nadella warns government conference not to betray user trust

Microsoft CEO Satya Nadella, delivering the keynote at the Microsoft Government Leaders Summit in Washington, DC today, had a message for attendees to maintain user trust in their tools technologies above all else.

He said it is essential to earn user trust, regardless of your business. “Now, of course, the power law here is all around trust because one of the keys for us, as providers of platforms and tools, trust is everything,” he said today. But he says it doesn’t stop with the platform providers like Microsoft. Institutions using those tools also have to keep trust top of mind or risk alienating their users.

“That means you need to also ensure that there is trust in the technology that you adopt, and the technology that you create, and that’s what’s going to really define the power law on this equation. If you have trust, you will have exponential benefit. If you erode trust it will exponentially decay,” he said.

He says Microsoft sees trust along three dimensions: privacy, security and ethical use of artificial intelligence. All of these come together in his view to build a basis of trust with your customers.

Nadella said he sees privacy as a human right, pure and simple, and it’s up to vendors to ensure that privacy or lose the trust of their customers. “The investments around data governance is what’s going to define whether you’re serious about privacy or not,” he said. For Microsoft, they look at how transparent they are about how they use the data, their terms of service and how they use technology to ensure that’s being carried out at runtime.

He reiterated the call he made last year for a federal privacy law. With GDPR in Europe and California’s CCPA coming on line in January, he sees a centralized federal law as a way to streamline regulations for business.

As for security, as you might expect, he defined it in terms of how Microsoft was implementing it, but the message was clear that you needed security as part of your approach to trust, regardless of how you implement that. He asked several key questions of attendees.

“Cyber is the second area where we not only have to do our work, but you have to [ask], what’s your operational security posture, how have you thought about having the best security technology deployed across the entire chain, whether it’s on the application side, the infrastructure side or on the endpoint, side, and most importantly, around identity,” Nadella said.

The final piece, one which he said was just coming into play, was how you use artificial intelligence ethically, a sensitive topic for a government audience, but one he wasn’t afraid to broach. “One of the things people say is, ‘Oh, this AI thing is so unexplainable, especially deep learning.’ But guess what, you created that deep learning [model]. In fact, the data on top of which you train the model, the parameters and the number of parameters you use — a lot of things are in your control. So we should not abdicate our responsibility when creating AI,” he said.

Whether Microsoft or the U.S. government can adhere to these lofty goals is unclear, but Nadella was careful to outline them both for his company’s benefit and this particular audience. It’s up to both of them to follow through.

Oct
08
2019
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Satya Nadella looks to the future with edge computing

Speaking today at the Microsoft Government Leaders Summit in Washington, DC, Microsoft CEO Satya Nadella made the case for edge computing, even while pushing the Azure cloud as what he called “the world’s computer.”

While Amazon, Google and other competitors may have something to say about that, marketing hype aside, many companies are still in the midst of transitioning to the cloud. Nadella says the future of computing could actually be at the edge, where computing is done locally before data is then transferred to the cloud for AI and machine learning purposes. What goes around, comes around.

But as Nadella sees it, this is not going to be about either edge or cloud. It’s going to be the two technologies working in tandem. “Now, all this is being driven by this new tech paradigm that we describe as the intelligent cloud and the intelligent edge,” he said today.

He said that to truly understand the impact the edge is going to have on computing, you have to look at research, which predicts there will be 50 billion connected devices in the world by 2030, a number even he finds astonishing. “I mean this is pretty stunning. We think about a billion Windows machines or a couple of billion smartphones. This is 50 billion [devices], and that’s the scope,” he said.

The key here is that these 50 billion devices, whether you call them edge devices or the Internet of Things, will be generating tons of data. That means you will have to develop entirely new ways of thinking about how all this flows together. “The capacity at the edge, that ubiquity is going to be transformative in how we think about computation in any business process of ours,” he said. As we generate ever-increasing amounts of data, whether we are talking about public sector kinds of use case, or any business need, it’s going to be the fuel for artificial intelligence, and he sees the sheer amount of that data driving new AI use cases.

“Of course when you have that rich computational fabric, one of the things that you can do is create this new asset, which is data and AI. There is not going to be a single application, a single experience that you are going to build, that is not going to be driven by AI, and that means you have to really have the ability to reason over large amounts of data to create that AI,” he said.

Nadella would be more than happy to have his audience take care of all that using Microsoft products, whether Azure compute, database, AI tools or edge computers like the Data Box Edge it introduced in 2018. While Nadella is probably right about the future of computing, all of this could apply to any cloud, not just Microsoft.

As computing shifts to the edge, it’s going to have a profound impact on the way we think about technology in general, but it’s probably not going to involve being tied to a single vendor, regardless of how comprehensive their offerings may be.

Sep
25
2019
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Vannevar Labs comes out of stealth to bring best-in-class AI tech to national security agencies

Few organizations have the complex data and analytics problems that challenge the defense and intelligence communities every single day. Whether it is managing petabytes of text, audio, or video data, finding extraordinarily small patterns in the noise, or processing multilingual analytics, the agencies at the heart of America’s national security system confront cutting-edge problems every day.

Despite the desire for better tools though, intelligence analysts are often stymied to procure up-to-date software due to the byzantine rules that drive Pentagon and intelligence procurement.

That’s why a former intelligence official and former intelligence investor are looking to build a new platform that connects the best minds in artificial intelligence, machine learning, and natural language processing and bundling it together into a service purchasable by these government agencies.

Through Palo Alto-based Vannevar, co-founders Brett Granberg and Nini Moorhead are hoping to launch their first product, which is focused on bringing NLP technologies like feature detection to international counterterrorism missions.

Vannevar Labs

Co-founders Nimi Moorhead and Brett Granberg of Vannevar Labs. Photo via Vannevar Labs.

The company is named for Vannevar Bush, who is often credited with inventing an early form of the computer, putting together the Manhattan Project which led to the atom bomb, and for writing a seminal essay that sort of predicted the internet decades before its inception.

The two chose this particular product as an entrée because of their past experiences. Before beginning Vannevar, Granberg spent two years at In-Q-Tel, the non-profit VC firm that works deeply with the intelligence community to supply agencies with the best in startup technology. He also was an advisor at Lilt, a real-time deep learning translation product that spun out of Chris Manning’s famed Stanford NLP research lab.

Meanwhile, Moorhead spent seven years working as a counterterrorism officer within the intelligence community, working to disrupt terrorist networks.

The two met while they overlapped at Stanford GSB and realized they had seen similar problems that they both wanted to solve. While in business school, “top of mind for me was some of the technological challenges that I encountered as an end user [and] analyst in the intelligence community,” Moorhead said. “We immediately connected and shared a lot of experiences in common in terms of seeing gaps between the really hard domain problems that I’d been working on in my career as an analyst and some of the technology that was available to me,” she said. The two actually met the first day of school.

Their approach is to take proven techniques and attempt to translate them into government use cases. “We’re not sort of inventing new math to solve these problems, we’re more taking cutting-edge approaches and just applying them to specific use cases,” Granberg said.

While the project is early, the team raised a $4.5 million seed venture capital funding from fellow GSB alum Katherine Boyle of General Catalyst and Costanoa Ventures. Boyle has made a big push into defense and highly-regulated industries as part of her investment practice, where she previously funded Anduril, the company started by Oculus founder Palmer Luckey that has attempted to apply ML technology to security issues such as battlefield awareness and border control (and gotten into some controversy along the way as well).

She is particularly excited about new ways for startups to secure government contracts at a speed faster than the sun burning out. Talking to me about the potential in this industry, she said:

We’ve been spending a lot of time with companies that are going after what’s known as Other Transaction Authorities, which are a new type of contracting vehicle that was developed in 2015 by former Secretary of Defense Ash Carter, to help tech companies work very quickly with the Department of Defense and with the intelligence community. So what historically might have taken 18 months to get a contract now takes 30 to 60 days for critical pieces of technology

Boyle explained that Vannevar fits directly into her thesis for the future of government procurement. “Our view is that the companies that do best in the space are people who have worked in government or understand how to sell to governments,” she said. She noted that the company is very early, and her investment was primarily focused on the team.

I asked about recent controversies that have hit companies like Google, which saw a revolt by some employees over its involvement with a defense program called Project Maven, which attempted to use machine learning technology and apply that to the battlefield, so that, for instance, drones could increase their effectiveness during strikes.

Granberg said that “we think that the people that defend our country should have access to the best tools and technologies to do their job. We know these people, we used to work with them, and we want to help them.”

He understands the concerns of critics though, and says that Vannevar intends to work with the government to ensure ethics remains core to its product. “We believe it’s our responsibility to sort of shape that technology and help the government think about putting in place policies that … prevent the misuse from happening.”

Boyle agreed. “One of the things that we’ve noticed is that if you’re very transparent and upfront about the types of products you’re going to be building in the beginning, it’s not a recruitment problem, it’s not an ethics problem.” Unlike Google, which had a six-figure large workforce with many employees who don’t want to touch defense-related code, the hope for Granberg and Moorhead is that a company like Vannevar can build a coalition of the willing, as it were, and maybe solve some serious security problems as well.

Sep
25
2019
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ZenBusiness raises $15M to help founders launch and grow ‘worry-free’

There are two sides to starting a new business. On one side, entrepreneurs need creativity, imagination — a dream, essentially — to find, build, and market a new product to users and consumers. But on the other side, they have to deal with the regulatory state and all the minutia that comes with running any business in the 21st century.

That includes such delightful topics as choosing a particular model for incorporation, ensuring that a business has the right licenses to operate, and tracking all the legal changes happening in 50 state legislatures every year. It can be inordinately complicated (and expensive!) to ensure that your business is ready and legal.

That’s where ZenBusiness comes in. The Austin-based startup wants to empower entrepreneurs to build businesses large and small by dramatically simplifying the processes required to launch a business and then grow it.

When I last chatted with the company 18 months ago, they had just raised a $4.5 million seed round and had launched its platform. Today, it’s announcing that it has raised a new $15 million series A round led by return backer Greycroft, along with returning investors Lerer Hippeau and Revolution’s Rise of the Rest fund, alongside new investors Rosecliff Venture Partners, Interlock Partners and Recruit Strategic Partners.

The company launched with a product that was essentially an automated registered agent for new entrepreneurs. Under state incorporation laws, companies must designate a so-called “registered agent” to receive official notices from regulatory agencies, and so ZenBusiness chose this strategic point for entry into the market.

When I last chatted with CEO Russ Buhrdorf, he described rolling up this market as one of the key initial targets for the company:

ZenBusiness is the brainchild of Ross Buhrdorf, who joined vacation rental marketplace HomeAway five months after its inception as founding CTO, and stayed for a decade until its acquisition by Expedia in 2015 for $3.9 billion. Buhrdorf intended to take a year off, but “didn’t quite make it a year” he told me.

He explained to me that HomeAway in many ways followed a rollup playbook, “raising $400 million and acquired 26 companies.” Bringing that rollup lens while exploring new spaces, he ran into the corporate legal services market, which offers help to companies to keep them in compliance with the law. Buhrdorf liked what he saw. “It’s different in all 50 states, highly-regulated, which is great for technology, it is overpriced, and they underserve their customers.” He says the space is “completely ripe for disruption.”

Since that time, the company has expanded its product to help entrepreneurs get beyond merely incorporating to actually building out their business by recommending services like banking, lending, tax preparation, website building, and more. The hope is to provide a “worry-free” guarantee to entrepreneurs so that they can get those early critical logistics out of the way and back to actually operating and growing their business.

“Small businesses come through this funnel, they don’t necessarily know exactly what to do. So we curate that solution, and then we provide them with the basics for them to get up and running and to be successful,” Buhrdorf said.

He explained that the company has built out some tools itself such as a simple webpage creator, but in the long run, he hopes to partner with other providers who integrate into the ZenBusiness platform. For instance, ZenBusiness has partnered with Xero as the company’s main accounting provider, while also backstopping that offering with accountants working at ZenBusiness. The idea is that the automated tooling plus a little human touch can help most owners handle the day-to-day challenges of running a business.

TeamPhoto2018

The ZenBusiness team in 2018. Photo via ZenBusiness.

Buhrdorf is particularly focused on keeping the product very self-service and automated to allow it to focus on these smaller customers. “Many of the companies that you cover that are in the enterprise space, who provide solutions for medium-sized businesses, they have to charge, they have to have sales forces, it’s very competitive there,” Buhrdorf said. “What we’re after is the segment that’s underserved, it’s the long tail of the small business segment.”

ZenBusiness has expanded its services, and it is hoping to use the fresh infusion of capital to invest in building out community features that will allow small business owners to swap tips with each other and help one another grow their businesses (presumably with some guidance from ZenBusiness community managers and experts).

The company is now 40 employees predominantly in Austin with a small office in Peru. Since we last checked in, the company has transitioned to become a public benefit corporation, which Buhrdorf said was an attempt to better align the company’s charter with its mission orientation to help small business entrepreneurs.

Update: The funding total was changed from $10m to $15m. Sorry about that.

Sep
23
2019
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Chef CEO does an about face, says company will not renew ICE contract

After stating clearly on Friday that he would honor a $95,000 contract with ICE, CEO Barry Crist must have had a change of heart over the weekend. In a blog post this morning he wrote that the company would not be renewing the contract with ICE after all.

“After deep introspection and dialog within Chef, we will not renew our current contracts with ICE and CBP when they expire over the next year. Chef will fulfill our full obligations under the current contracts,” Crist wrote in the blog post.

He also backed off the seemingly firm position he took on Friday on the matter when he told TechCrunch, “It’s something that we spent a lot of time on, and I want to represent that there are portions of [our company] that do not agree with this, but I as a leader of the company, along with the executive team, made a decision that we would honor the contracts and those relationships that were formed and work with them over time,” he said.

Today, he acknowledged that intense feelings inside the company against the contract led to his decision. The contract began in 2015 under the Obama administration and was aimed at modernizing programming approaches at DHS, but over time as ICE family separation and deportation polices have come under fire, there were calls internally (and later externally) to end the contract. “Policies such as family separation and detention did not yet exist [when we started this contract]. While I and others privately opposed this and various other related policies, we did not take a position despite the recommendation of many of our employees. I apologize for this,” he wrote.

Crist also indicated that the company would be donating the revenue from the contracts to organizations that work with people who have been affected by these policies. It’s a similar approach that Salesforce took when 618 of its employees protested a contract the company has with the Customs and Border Patrol (CBP). In response to the protests, Salesforce pledged $1 million to organizations helping affected families.

After a tweet last week exposed the contract, the protests began on social media, and culminated in programmer Seth Vargo removing pieces of open-source code from the repository in protest of the contract in response. The company sounded firmly committed to fulfilling this contract in spite of the calls for action internally and externally, and the widespread backlash it was facing both inside and outside the company.

Vargo told TechCrunch in an interview that he saw this issue in moral terms, “Contrary to Chef’s CEO’s publicly posted response, I do think it is the responsibility of businesses to evaluate how and for what purposes their software is being used, and to follow their moral compass,” he said. Apparently Crist has come around to this point of view. Vargo chose not to comment on the latest development.

Sep
23
2019
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Programmer who took down open-source pieces over Chef ICE contract responds

On Friday afternoon Chef CEO Barry Crist and CTO Corey Scobie sat down with TechCrunch to defend their contract with ICE after a firestorm on social media called for them to cut ties with the controversial agency. On Sunday, programmer Seth Vargo, the man who removed his open-source components, which contributed to a partial shutdown of Chef’s commercial business for a time last week, responded.

While the Chef executives stated that the company was in fact the owner, Vargo made it clear he owned those pieces and he had every right to remove them from the repository. “Chef (the company) was including a third-party software package that I owned. It was on my personal repository on GitHub and personal namespace on RubyGems,” he said. He believes that gave him the right to remove them.

Chef CTO Corey Scobie did not agree. “Part of the challenge was that [Vargo] actually didn’t have authorization to remove those assets. And the assets were not his to begin with. They were actually created under a time when that particular individual [Vargo] was an employee of Chef. And so therefore, the assets were Chef’s assets, and not his assets to remove,” he said.

Vargo says that simply isn’t true and Chef misunderstands the licensing terms. “No OSI license or employment agreement requires me to continue to maintain code of my personal account(s). They are conflating code ownership (which they can argue they have) over code stewardship,” Vargo told TechCrunch.

As further proof, Vargo added that he has even included detailed instructions in his will on how to deal with the code he owns when he dies. “I want to make it absolutely clear that I didn’t “hack” into Chef or perform any kind of privilege escalation. The code lived in my personal accounts. Had I died on Thursday, the exact same thing would have happened. My will requests all my social media and code accounts be deleted. If I had deleted my GitHub account, the same thing would have happened,” he explained.

Vargo said that Chef actually was in violation of the open-source license when they restored those open-source pieces without putting his name on it. “Chef actually violated the Apache license by removing my name, which they later restored in response to public pressure,” he said.

Scobie admitted that the company did forget to include Vargo’s name on the code, but added it back as soon as they heard about the problem. “In our haste to restore one of the objects, we inadvertently removed a piece of metadata that identified him as the author. We didn’t do that knowingly. It was absolutely a mistake in the process of trying to restore customers and our global customer base service. And as soon as we were notified of it, we reverted that change on this specific object in question,” he said.

Vargo says, as for why he took down the open-source components, he was taking a moral stand against the contract, which dates back to the Obama administration. He also explained that he attempted to contact Chef via multiple channels before taking action. “First, I didn’t know about the history of the contract. I found out via a tweet from @shanley and subsequently verified via the USA spending website. I sent a letter and asked Chef publicly via Twitter to respond multiple times, and I was met with silence. I wanted to know how and why code in my personal repositories was being used with ICE. After no reply for 72 hours, I decided to take action,” he said.

Since then, Chef’s CEO Barry Crist has made it clear he was honoring the contract, which Vargo felt further justified his actions. “Contrary to Chef’s CEO’s publicly posted response, I do think it is the responsibility of businesses to evaluate how and for what purposes their software is being used, and to follow their moral compass,” he said.

Vargo has a long career helping build development tools and contributing to open source. He currently works for Google Cloud. Previous positions include HashiCorp and Chef.

Sep
20
2019
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Chef CEO says he’ll continue to work with ICE in spite of protests

Yesterday, software development tool maker Chef found itself in the middle of a firestorm after a Tweet called them out for doing business with DHS/ICE. Eventually it led to an influential open source developer removing a couple of key pieces of software from the project, bringing down some parts of Chef’s commercial business.

Chef intends to fulfill its contract with ICE, in spite of calls to cancel it. In a blog post published this morning, Chef CEO Barry Crist defended the decision. “I do not believe that it is appropriate, practical, or within our mission to examine specific government projects with the purpose of selecting which U.S. agencies we should or should not do business.”

He stood by the company’s decision this afternoon in an interview with TechCrunch, while acknowledging that it was a difficult and emotional decision for everyone involved. “For some portion of the community, and some portion of our company, this is a super, super-charged lightning rod, and this has been very difficult. It’s something that we spent a lot of time on, and I want to represent that there are portions of [our company] that do not agree with this, but I as a leader of the company, along with the executive team, made a decision that we would honor the contracts and those relationships that were formed and work with them over time,” he said.

He added, “I think our challenge as as leadership right now is how do we collectively navigate through through times like this, and through emotionally-charged issues like the ICE contract.”

The deal with ICE, which is a $95,000 a year contract for software development tools, dates back to the Obama administration when the then DHS CIO wanted to move the department towards more modern agile/DevOps development workflows, according Christ.

He said for people who might think it’s a purely economic decision, the money represents a fraction of the company’s more than $50 million annual revenue (according to Crunchbase data), but he says it’s about a long-term business arrangement with the government that transcends individual administration policies. “It’s not about the $100,000, it’s about decisions we’ve made to engage the government. And I appreciate that not everyone in our world feels the same way or would make that same decision, but that’s the decision that that we made as a leadership team,”Crist said.

Shortly after word of Chef’s ICE contract appeared on Twitter, according to a report in The Register, former Chef employee Seth Vargo removed a couple of key pieces of open source software from the repository, telling The Register that “software engineers have to operate by some kind of moral compass.” This move brought down part of Chef’s commercial software and it took them 24 hours to get those services fully restored, according to Chef CTO Corey Scobie.

Crist says he wants to be clear that his decision does not mean he supports current ICE policies. “I certainly don’t want to be viewed as I’m taking a strong stand in support of ICE. What we’re taking a strong stand on is our consistency with working with our customers, and again, our work with DHS  started in the previous administration on things that we feel very good about,” he said.

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