Why some big money is holding out for now
After just one full day of campaigning, Vice President Kamala Harris has a glide path to the Democratic presidential nomination. She has won endorsements from potential rivals and from powerful party figures like Representative Nancy Pelosi, the former speaker.
The Harris campaign also said it had raised more than $100 million between Sunday afternoon and Monday evening. But some major Democratic donors, including Mike Bloomberg and the venture capitalist Vinod Khosla, have yet to endorse her. DealBook hit the phones to find out why.
Big-ticket backers don’t want it to look like a coronation. The concern is that if they support Harris too soon, they would appear to be anointing their party’s presidential candidate, rather than her earning it through a full democratic process. That would be reminiscent of the old days of smoke-filled rooms — and, in their minds, risked backfiring politically.
In a post on X on Monday, Bloomberg stressed that the nominating process should play out:
While some elected leaders and party officials make their endorsements, there are still four weeks before the party’s more than 4,000 delegates convene in Chicago. That is more than enough time for the party to take the pulse of voters, especially in battleground states, to determine who is best positioned to win in November and lead the country over the next four years.
And Khosla posted on X, “An open process will allow everyone a chance to make their case and express their views. Coronations are bad for democracy.”
It isn’t just donors holding back their endorsement: Senator Chuck Schumer, the majority leader, and Representative Hakeem Jeffries, the minority leader, have also stayed neutral in public.
But everyone could fall in line soon. Harris has already secured pledges from more than enough delegates to win the nomination. (Though these pledges are not binding, it’s unclear there is any other option.)
Harris has also collected public support from prominent financial backers as well, including Laurene Powell Jobs and Ron Conway. Female supporters in particular are mobilizing, and about 300 donors to Harris’s previous presidential bids joined a call on Monday organized by an aide to the vice president to start mobilizing.
Harris’s campaign team is taking shape. The vice president has asked Biden’s campaign chair, Jen O’Malley Dillon, to run her team. And Eric Holder, the attorney general under Barack Obama, will oversee vetting of potential running mates.
In other election news: Elon Musk confirmed that he created a pro-Trump super PAC, but denied that he planned to donate $45 million a month to the group. One challenge facing Harris is how to sell President Biden’s economic record. And the vice president got additional pop-culture street cred from the likes of Beyoncé and Charli XCX.
HERE’S WHAT’S HAPPENING
Warner Bros. Discovery matches Amazon’s bid for N.B.A. broadcast rights. The move by Warner Bros. Discovery, whose TNT has aired games and “Inside the N.B.A.” for decades, signals a potential fight with Amazon, which has offered to pay the league more than $1.9 billion per season for 11 years. Last week, the N.B.A. struck separate deals with Disney, the parent company of ESPN, and NBCUniversal.
General Motors’s Cruise resumes public testing of its autonomous vehicles. Driverless taxis — with human safety drivers — are back on streets in Dallas, Houston and Phoenix. G.M. had suspended most of Cruise’s operations last year, after one of its vehicles hit and dragged a pedestrian in San Francisco.
A proposal to build a Silicon Valley-backed city is on hold. The East Solano Plan, which was backed by the likes of Reid Hoffman and Laurene Powell Jobs, was delayed for at least two years to study its environmental effect. Supporters said the new city, which would be built on farmland 60 miles from San Francisco, would help ease housing pressure in California.
Another regulatory check on Google’s plans
Two ambitious Google initiatives — a potential $23 billion takeover of the cybersecurity start-up Wiz and a phaseout of the data-tracking technology known as third-party cookies — have ended.
Behind the moves, at least in part, was the specter of regulators seeking to rein in the power of tech giants.
Antitrust concerns may have doomed the Wiz talks, according to The Financial Times, which reported that members of both companies’ boards opposed a transaction on those grounds. A takeover of Wiz would have been Google’s biggest-ever acquisition, as well as one of the largest of a start-up.
Regulators including the Justice Department and the Federal Trade Commission have been cracking down on Big Tech and been more willing to sue to block deals. A lengthy review could have taken more than a year, as happened in Adobe’s failed takeover of the design company Figma.
Wiz’s C.E.O., Assaf Rappaport, told employees on Monday that the company would instead focus on going public.
Regulatory opposition also played a role in Google’s U-turn on cookies. In 2020, Google announced that it would scrap cookies in its dominant Chrome web browser, with an initial aim to eliminate them by 2022. (Cookies are tiny bits of data embedded in websites that, among other things, allow advertisers to track users and show them more relevant ads.)
Google, which already allows users to block cookies via Chrome’s settings, argued that disabling the tech altogether would better protect user privacy. But advertisers and regulators argued that the move would hurt competition in digital advertising, with brands being forced to rely more on Google’s other ad-targeting offerings.
Opinions on Google’s decision were mixed. Shares in ad-tech companies rose on the news, as investors welcomed the end of a potential threat to their businesses. The Movement for an Open Web, an industry coalition that opposed Google’s planned alternatives to cookies, cheered the move.
But Britain’s Information Commissioner’s Office, which had been investigating Google’s plans, criticized the move. “Despite Google’s decision, we continue to encourage the digital advertising industry to move to more private alternatives to third-party cookies — and not to resort to more opaque forms of tracking,” said Stephen Bonner, a deputy commissioner.
Vista Outdoor delays a showdown over its deal
The drama over the fate of Vista Outdoor, the maker of both CamelBak water bottles and Remington ammunition, is getting another act.
A shareholder vote on its deal to sell its ammo division to the Czechoslovak Group, or CSG — a transaction many investors and an influential advisory firm opposed — that had been scheduled for Tuesday was delayed again, to July 30. Separately, MNC Capital, an investment firm whose bids to buy all of Vista have been repeatedly rejected, reiterated that it was still interested.
CSG raised its offer for the Vista ammo business once more, announcing on Monday that it would now pay $2.15 billion. (It had originally agreed to buy the division, known as Kinetic, last fall for $1.91 billion.)
Vista added another sweetener for investors: It’s allowing an additional $125 million in cash that was meant to stay with its remaining business, known as Revelyst, to instead be paid out to shareholders. All told, that means Vista stockholders would receive $24 a share in cash, as well as a share of Revelyst.
By contrast, MNC is currently offering $42 a share, or $3.2 billion, for all of the company. (MNC and Vista are disputing over whether the firm can buy stock directly from investors.)
The price bump and the vote delay suggest that Vista is on the back foot. The CSG deal has been under increasing pressure for weeks, especially after Institutional Shareholder Services, the proxy advisory firm, changed its mind and urged investors to reject the transaction. (The other primary proxy adviser, Glass Lewis, had raised questions about Vista’s financial forecasts but ultimately recommended the transaction.)
And one of Vista’s biggest shareholders, Gates Capital Management, on Friday reiterated its opposition to the CSG deal.
MNC predicted Vista’s latest moves. In a letter to the company’s board sent on July 17 that DealBook has reviewed, the firm said it expected Vista to soon announce a bump in the CSG deal’s price, additional cash and a delay to the vote.
“Shareholders will see right through this,” wrote Mark Gottfredson, MNC’s leader.
Masa Son accelerates his A.I. plan
Masa Son, the outspoken founder of SoftBank, has said that he is moving to “offense mode” as he shifts his tech giant out of a defensive crouch to bet big on the artificial intelligence boom.
One way he plans to achieve that: leading a new path on self-driving cars, The Times’s River Akira Davis writes.
Son is hitting the accelerator after a quiet period for SoftBank. The Japanese mogul built a career, and an estimated $34 billion fortune, on unconventional but spectacularly successful wagers. Most notable was SoftBank’s early investment in Alibaba, the Chinese e-commerce giant; its stake was later valued at more than $100 billion.
But other big bets, including on WeWork and loss making start-ups by SoftBank’s Vision Funds, went sour. That forced him to focus on rebuilding his group’s balance sheet and last year’s I.P.O. of Arm, the chip design company that SoftBank controls.
Son says his previous investments were “just a warm-up” for A.I. The SoftBank chief has long been intrigued by A.I., but now seems to have found his moment. Shares in Arm have soared on the promise of its forthcoming A.I. chips.
In May, SoftBank’s C.F.O., Yoshimitsu Goto, told The Financial Times that the company was ready to invest $9 billion a year on the technology.
SoftBank’s involvement in Europe’s biggest A.I. deal underscores his ambitions. In May, the company led a $1 billion funding-raising round for Wayve, a British start-up whose software allows vehicles to “learn” while driving.
Son has also held talks about backing an A.I.-infused potential smartphone replacement being developed by Sam Altman’s OpenAI and Jony Ive, the former Apple design boss. And this month, SoftBank bought Graphcore, an A.I.-focused chipmaker.
Son wants the car industry to collaborate on A.I., including by sharing resources like the vehicle-driving data used to train such systems. He has held discussions with leaders from companies such as Honda and Nissan, as well as Dara Khosrowshahi, the C.E.O. of Uber, Akira Davis writes.
Some industry executives are worried about the amount of time and money it would take to develop A.I.-powered autonomous vehicles. But they agree with Son on one thing: They need to speed up their efforts to avoid falling further behind Tesla and Chinese rivals.
THE SPEED READ
Deals
The private equity firm L Catterton has reportedly approached Mattel about a takeover. (Reuters)
An Abu Dhabi investment partnership planned by Ray Dalio’s family office is said to be on hold because of the terms of the financier’s exit from Bridgewater Associates. (Bloomberg)
Elections, politics and policy
Congressional Republicans called on CrowdStrike’s C.E.O., George Kurtz, to testify about the cybersecurity company’s role in last week’s global I.T. outage. (Axios)
The billionaire founder of Kakao, a South Korean tech giant, was arrested over accusations of stock price manipulation tied to an investment in a leading K-pop agency. (NYT)
Best of the rest
Darren Walker, who transformed the Ford Foundation into a philanthropic force, is stepping down as the organization’s president. (NYT)
Is there something about Yale Law School that makes it a finishing school for conservative leaders like JD Vance and several Supreme Court justices? (Bloomberg Opinion)
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