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The latest news from Business Insider

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    soho retail startups 0262

    • Amazon recently opened its newest store concept, Amazon 4-star, in SoHo.
    • It's the latest of several e-commerce-focused retailers to open up shop in that neighborhood, including popular retail startups AllbirdsEverlane and Casper. SoHo has become a place where e-commerce companies can test out their brick-and-mortar strategies. 
    • According to Nicole LaRusso, director of research & analysis for CBRE Tri-State, there are a few reasons that brands keep choosing this neighborhood, including the fact that rents are relatively low. 
    • We went to SoHo to see for ourselves how prevalent this trend is. 

    Amazon opened its newest store concept, Amazon 4-star, in New York's SoHo neighborhood on Thursday.

    The store, which carries only Amazon's top-rated products, opened its doors on Spring Street, where many e-commerce companies have been testing out their brick-and-mortar strategies. 

    Allbirds, once an online-only retailer known for making "the world's most comfortable shoe,"  just opened up its first permanent flagship store in SoHo. 

    They aren't the only stores to do so. In the past year, it seems like more and more online-only stores have been opening up in downtown Manhattan. Retail startups like Everlane, Allbirds, Casper, and others which started as e-commerce only brands have been opening up their first physical retail stores in SoHo and surrounding neighborhoods like NoHo and Nolita. 

    "Being in the SoHo neighborhood makes our brand experience accessible to New Yorkers, and also to visitors from around the country and the world," Allbirds told Business Insider. "Our first SoHo store was a concept store — it was meant as a learning opportunity for us and a way to interact with customers in our largest market." 

    The neighborhood tends to draw a lot of startups that are willing to invest more in their physical stores, according to Nicole LaRusso, Director of Research & Analysis for CBRE Tri-State. She explained to Business Insider that SoHo attracts sophisticated and thoughtful millennials that these brands are targeting. What's more, the varied mix of brands in the area keeps the shopping experience interesting for customers. 

    This wasn't always the case. Between 2010 and 2014, there were countless empty storefronts in SoHo. Rents were high, and shoppers were starting to shift towards online shopping instead of shopping in physical stores. 

    According to data CBRE shared with Business Insider, rents began to drop in early 2016, and e-commerce startups began filling the spaces either permanently or as pop-ups. In some cases, like with Everlane, stores will start out as a pop-up shop, and if the shop is successful, the brand will move in permanently. 

    We recently went shopping in SoHo and saw for ourselves how prevalent this trend is: 

    SEE ALSO: Amazon just opened a new store that sells only its best products. Here's what it's like to shop there.

    To track rents and study real estate trends in different parts of NYC, CBRE divides the city into neighborhoods, and then divides each neighborhood into different corridors.

    In SoHo, there are three main corridors CBRE looks at: Prince Street ...

    ... Spring Street ...

    See the rest of the story at Business Insider

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    Brad Katsuyama 2

    • Brad Katsuyama is the co-founder and CEO of the Investors Exchange (IEX), which thwarts predatory high-frequency trading (HFT).
    • HFT uses computers to make many trades in a fraction of a second, which Katsuyama argues is used by some in an unfair way.
    • Katsuyama and IEX came to prominence as the stars of Michael Lewis' 2014 bestseller "Flash Boys."
    • IEX will list its first company in October, a major turning point for the exchange.
    • Katsuyama does not consider himself a natural entrepreneur, but was compelled to start IEX out of a fierce belief that he could help fight what he deemed a rigged system.

    Brad Katsuyama has never considered himself a maverick or anything like an entrepreneur. Before founding the Investors Exchange (IEX), he had a cushy job as an executive at the Royal Bank of Canada.

    But the more he learned about high-frequency trading — where computers can trade a bunch of stocks in a fraction of a second — the less comfortable he felt. He felt so strongly that high-frequency trading was harming the market that he set out on a path to create his own exchange, where predatory trading was thwarted.

    Investors can trade stocks from other exchanges on the IEX, with the idea that it's a level playing field. And in October it will list its first exclusive company, Interactive Brokers.

    As CEO, Katsuyama has adapted to being the face of the IEX. But when Michael Lewis wrote a book about him, in 2014, the best-selling "Flash Boys," he felt a bit in over his head.

    Listen to the full episode here:

    Subscribe to "This Is Success" on Apple Podcasts, Google Play, or your favorite podcast app. Check out previous episodes with:

    Transcript edited for clarity.

    Brad Katsuyama: I had never been on television, live television, until "60 Minutes." I had more LinkedIn requests at the end of that "60 Minutes" episode than I had connections. We had over 500 people during the episode send résumés to the careers@IEX email. So things changed very quickly.

    Beforehand, Michael Lewis gave me pretty good advice, and he said, read something about you that says you're a hero and read something about you that's really negative. He said, do an inventory of how that feels. He said, if the bad ones feel much, much worse and the good one feels good, he said, stop reading everything. So I did that, and the bad one felt really, really bad. And so I just ... really, I don't know if I'd read an article fully written about me in years. My team is good at keeping me informed, and I focus on the business, and I think if you don't let it change you, I think I'm the same person I was before that happened.

    Richard Feloni: On that note, how do you think that Lewis represented you? Even just you personally?

    Katsuyama: He absolutely nailed me personally, my character, And what was really funny, was that I was really nervous going into it because I had read basically everything Michael had written.

    Feloni: In preparation or just as a fan?

    Katsuyama: No, as a fan. "Moneyball" is probably still one of my favorite books of all time.

    Feloni: So now you got to star in your favorite writer's —

    Katsuyama: I never thought that was actually going to happen, but his characters are larger than life. And I was really concerned. I'm a pretty normal person and never meant to cause much trouble. Even growing up, I always just tried to get along with people. It's just a lot easier to do that than to fight. And so, in the middle of kind of his research and his writing, he said, I'm having a lot of trouble writing about you because you're kind of boring!

    Flash Boys coverAnd so, I remember, he flew up to Toronto to have dinner with five of my childhood friends, and he went around with my mom, my stepfather, to try to get to know me better or my background better. On the plane ride back, he sends me a text and says, I figured you out. And I was, like, OK, here we go.

    You were never looking for a fight, he goes; the fight found you and you fought back. And that is the truest statement that could ever be made about how I ended up in this situation. I was never looking, never really to fight with anyone. It just so happened that this was the way my life went, and when faced with the decision of whether to let it go or to fight back, I chose to fight back.

    I think him figuring that out on his own, I think, for me was the first time I was comfortable. The way that he was going to portray me was actually going to be an accurate description of who I am as a person so, that's what resonated with people in "Flash Boys," is that this could have been anybody. I don't view myself as special in any particular way. I think I was the right person in the right situation.

    Feloni: So growing up, did you have a vision of who you would become? Did you have a dream of what you wanted to be?

    Katsuyama: Absolutely not. I've had a comfortable life. I've had the same group of friends really since I was 5 years old. Grew up in a pretty normal place. My family life is solid. I was never forced or had this strong desire to be something. So yeah, no. In a funny way. Which is really why, I read Michael Lewis to read about other people who were doing amazing things. I never in a million years thought that I would be in a Michael Lewis book. Just never.

    Feloni: That's funny. Not the traditional path to being a disrupter.

    Katsuyama: No. Not at all. There's nothing about my background ... I think part of the struggle was there was nothing about my background that made him think that this is something that would have happened.

    One interesting piece is that he was, like, give me something, you know, to talk about. Because typically it's something in your childhood sparks something, and so when he found out my parents were divorced, he really tried to dive in. He was, like, tell me more about that. I was, like, listen. I said, my mom and my dad are still friends. My dad would come over for Christmas and we'd all golf together. Lewis is, like, "OK, that's not going to work." He basically scratched it out.

    I've always been someone who's had a lot of ideas. I've always been someone who's tried to give advice and be a good friend and a good teammate. But, yeah, there was never this take-on-the-system mentality at all.

    Finding something that had him reconsider everything

    Feloni: And even aside from your personal character, was there ever any side of you that was maybe entrepreneurial in that sense?

    Katsuyama: I worked at the same place my entire career so ....

    Feloni: So no.

    Katsuyama: I worked at the Royal Bank of Canada. I had many different jobs. I always like building and creating, running and building teams, and I had seven jobs in 12 years at RBC. So I think maybe there was a bit of that spirit there, but I could have retired at RBC and never had a second doubt. So I think maybe ... I'd say I'm more of an intrapreneur than an entrepreneur.

    Feloni: What led you into finance in the first place?

    Katsuyama: Definitely not a love of finance. I mean, I took finance in school, but I never really had an affinity for the stock market.

    I played hockey and football growing up. My stepfather played hockey with someone who was a client of the Royal Bank of Canada, and he said, you know what, I think Brad would be a good trader. He's competitive. He's good with numbers and he's pretty smart. So my stepdad came home and said, you know, Jack thinks you'd be a good trader, and here's a contact at the Royal Bank of Canada, and so I sent it in. And basically it was choosing between that, a job at Microsoft, a job at investment, and a marketing job at Proctor and Gamble. Those were my picks, and I picked trading. It's just where I ended up, in a way.

    I think part of IEX, knowing the risks we took to start IEX, I think partly is grounded in I don't feel that working on Wall Street identifies who I am. So if I lost it all tomorrow, I think I could be totally happy with my life, from that point forward, and I think a lot of people over-identify with their jobs. I don't really feel that way.

    So, one of my jobs was going from running risk training where I managed a group of human traders to taking on the role to run global electronic sales and training, and that meant managing a team of computer programmers and network engineers. People who are building algorithms that my training team was using. That shift, in a way, was eye-opening for me because it turned out that those network engineers and programmers actually knew more about how the stock market worked, than I did or my trading team did as traders!

    And when you start to understand the plumbing of the stock market, you start to ask a lot of questions. Well, how can they trade at that speed? Well, why is the exchange selling them this cable? Why are the exchanges erecting these microwave dishes? You start to get down this questioning path and then you figure out, wow, I can't find any of this stuff on the internet. I have to hire people with insider knowledge about how these exchanges are actually operating their businesses.

    It does become an insider's game. Where the majority of the people, including some big investors, have no idea this is what's happening in the stock market. Because again, if you're applying this tax on people, you don't want them to know that they are being taxed. You don't want them to know that you even exist. You just want to keep applying that, so that's really what happened. This subculture in the stock market exploded and it was taxing everyone else who needs the stock market to invest in companies.

    That's the thing that I think is, you know, most concerning about all this is, that the purpose of the stock market is you have companies that need capital to build their businesses, build products, provide services, et cetera, and the investors are the ones who have that capital. So that transference in today's market, 2018, should be pretty efficient, right? Unfortunately, it's not efficient at all because the middlemen, the exchanges, have made it unbelievably complicated to extract maximum rents from that transference of capital. So I think that's what we're trying to do, is fix that.

    Feloni: And then when you were exposed to this, at what point did it go from being something that you were upset by, or just intrigued by, to all right, I'm quitting my job, I'm starting my own exchange? That's a pretty big leap.

    Katsuyama: So I think the decision point at RBC, there were a few factors. I think one was, yes, we wanted to solve this problem on a bigger scale. Two is that the success we had at RBC. There's this one survey called the Greenwich Associates Report, and RBC went from being ranked No. 19 in the United States for products to No. 1 in six months.

    Feloni: And that was the team you were working with?

    Katsuyama: That was the team that I was running. So that was a huge win. So that doesn't mean we're No. 1 in market share. That just means people think our products are the best.

    The analogy I used is that's like winning the Super Bowl and then everyone the next year is a free agent and then you have a salary cap. There is no way you can keep that team together. So what was happening at RBC is that me and a bunch of my key people were all getting job offers from other banks. So if I don't do anything, I'm just going to be managing a team that's been depleted and there's going to be all this turnover and we're going to have to start over and do a bunch of things. So that wasn't very appealing.

    The third piece was I was starting to read more articles. This was in 2011, where big banks, I remember reading this article that's saying Goldman Sachs is having trouble paying its best people, because they want to pay them enough to keep them, which they have to do. But they don't want to pay them too much to enrage society. And I started to hear more and more about Wall Street compensation. I said wow, society is having an impact on the way Wall Street operates. I also kind of wanted to kind of get in front of a tidal wave that I thought was coming where Wall Street was going to be more accountable for transparency and truth and fairness. There was this trend.

    Feloni: Like a cultural shift after the Great Recession.

    Katsuyama: Absolutely. The financial crisis created a mistrust between Main Street and Wall Street, and I thought we can create a company that essentially positions ourselves for this wave. Not to say that people didn't trust RBC — they did. It was a great place to work, but just kind of creating our own company to keep this group together, to solve the bigger problem, and to be kind of well positioned for this change that we're seeing coming on Wall Street.

    Those three factors were the reason that we decided to leave.

    IEX team

    Risking it all to take on a duopoly

    Feloni: Then what did your family and friends say when you decided you were going to do this?

    Katsuyama: The first person I had to get buy-in from was my wife, and my second son was born three days after I started IEX. So obviously life was changing pretty dramatically. But she was always a believer in kind of, this is your path and I have confidence in what you're doing, and kind of the deal we made is if this doesn't work, I am going to leave finance and we're going to prioritize where we live and I'll find another job.

    So, again, I think it was an asset to not be attached to Wall Street. I was willing to take a risk that other people aren't necessarily willing to take. I got buy-in from her and my family, my friends — no one really questioned what we were doing. I think I had enough conviction at that point that this was the right path, that people bought in.

    A lot of people from RBC, when they heard I was leaving, wanted to leave. We took a very small group of people. But I think one piece of advice I would give people is it ended on good terms because I didn't hide anything from RBC. When I had the idea, I brought it to them. We tried to do it actually as an RBC-created exchange and the customers told us, well, it can't just be RBC because Goldman Sachs will never want to route to an RBC-created exchange. So RBC understood that they couldn't be a part of this exchange. And so, I think being above board, and there were people I trusted at RBC ...

    Feloni: Just being fully transparent?

    Katsuyama: Being fully transparent. We walked away. I think a lot of times people try to hide things. And it ends up working out a lot worse and frankly, RBC is still a good customer. Relationships are still there. There's still a level of trust and I think if I had tried to hide all this, that would have been destroyed. And I had worked my whole career. Why would anyone want to burn a bridge like that?

    Feloni: What did you find, in terms of the experience of being a leader as an executive at a big bank, to now being a CEO of a startup?

    Katsuyama: You take a lot of things for granted at big companies. I think what concerns me a little bit about what happens now or when I talk at universities or different places, I think some people want to start a company more than they want to start a particular company — "I just want to be an entrepreneur." I think there's a huge amount of risk there, because there are things that you would take for granted or there's things that you can learn at a big company, that you just can't on your own because once you're on your own, it's as much about survival as it is about anything.

    Feloni: So there's less time to learn more skills?

    Katsuyama: Absolutely. Without question. It's like, "OK, we need phones. We need insurance. We need this, that, and the other thing." So you're making decisions that are necessary that certainly aren't ... you're not learning anything when you're on, when you're talking to the phone company all day. I think, you learn how much we took for granted at a big company. At a big company it's about here's a business, go build it. And everything else just sort of works, right? You show up. There's chairs in your office and stuff like that. I think as an entrepreneur you find out really quickly how much needs to be done that has nothing to do with the business you're trying to run.

    Feloni: And you're there as the lead inspiration for your team, as well.

    Katsuyama: Yeah, the risk level ... I think I fretted more about the risk other people were taking than my own risk. At one point, the highest paid person at IEX was my assistant because she wanted to come and she did, God bless her for coming, but she couldn't afford as big of a pay cut as the rest of us could in a way, so you kind of got to do things like that to make sure that you're treating people fairly. Yeah, I still fret about it. People's families rely on us to make good decisions and to build a good business so that's a level of stress that I think you don't have at a big company.

    But at the same time, when the buck stops at you, when you're the CEO of the company, you can control the amount of politics that exist in your own space and, also to an extent, the company's space. And I think that I spent a lot of time at a big organization dealing with politics and that cuts into productivity. I don't think I work more hours than I did at the big bank. I just think I work way more productively in the hours I spend.

    We're in a different life cycle. The early life cycle, fundraising was the hardest thing I've ever had to do in my life. It's incredibly humbling. You get rejected hundreds of times and people are basically pretty ruthless at times about the thing, your dream. It's like, "Here's my dream," and they're like, "Here's all the reasons why it's not going to happen," or, "Here's why you are stupid or crazy, or, you know, I heard [you've got odds of] "one in a million" from a pretty savvy investor. When you hear that you're like, oh my God, what have I done? Fundraising was definitely something I had no idea how hard it was going to be.

    Feloni: Well, in that moment, when you have someone who kind of like, maybe someone who you admire and respect, and they just completely shoot down your dream, did you have a moment where you questioned everything that you were doing?

    Katsuyama: I had many moments when I questioned everything I was doing!

    So one piece of advice that I give to anyone thinking about starting a company is you have to have experienced the problems that you're trying to solve. You have to. It can't be, oh, I'm told this or I've read this. It's you have to have lived through the problems you're trying to solve because there will be moments where you will doubt yourself. There will be moments where you're absolutely at rock bottom. If you can't rely back on the fact that you have experienced the problem that you're trying to solve, you'll doubt whether that problem exists. You can talk yourself out of it in a way. I had many low moments. But I would always fall back on the fact that I lived through this problem, for years. And I know we can solve it. Then you snap out of it pretty quickly. We had many, many ups and downs. It's another good thing about having a good team.

    When I was out raising funds, one of our co-founders, Ronan Ryan, who is our president, he and I would go on these pitches together. And I think what was nice was we'd be riding the subway back and I would be totally bummed. He'd be, like, "No, man. It's OK. We've got this. Don't worry about it." Then he would be totally bummed the next week and I'd be, like, "OK, man. We got this." So I don't even think we hit rock bottom at the same time. So, that probably kept us going too. If you can afford it, having partners, teammates, is really helpful. I think alone it would have been a much scarier situation than with a team.

    Feloni: Because they share that vision and they could lift you up when you need that boost?

    Katsuyama: Yeah, and people can focus on their areas of expertise, right? Like our CTO never left the office. He was coding nonstop and our COO was the one getting the phones set up and doing all these things, these thankless jobs, but he knew that's where he was kind of best focused. So I think we had experts that were focused in their areas. And yeah, do I own less of the company than I would if I didn't have [them]? Yeah. But 50% of zero is zero. There's no way in the world that IEX would be where it is at this moment if I didn't have that team alongside me.

    brad katsuyama iex

    Balancing ambition with patience

    Feloni: Was it difficult building an exchange when you're working with the Securities and Exchange Commission, the SEC, and things move gradually with federal oversight? Was that ever frustrating in terms of things had to move a bit more slowly than at other startups?

    Katsuyama: Oh yeah. I mean, it took us two years to get our exchange approval. In startup language, two years is an eternity. It took us another year after that to get approval to list companies.

    There are pros and cons of regulation. The pro is that the barrier to entry is really high. The expertise level is really high. A group of kids in college can't create a stock exchange. You just can't. You don't have the expertise. You don't have the understanding of the regulation. It's just very, very hard to do. The downside is that, yes, there is a huge wall to climb over just for the right to compete. And I do think it's why you don't see a huge amount of disruption in our part of the world, because it is so heavily regulated. A lot of times innovators are allergic to regulation. And for good reason.

    So for us it was about getting the right people, setting the right kind of long-term agenda. And I say this all the time, almost ad nauseam, I say, I believe we're on the right side of this and I can predict we're going to be on the right side of this. What I can't predict is when that's going to happen because it's outside of our control. So we need to focus on the things we can control. I did my best to not over-promise, to not overestimate. It's a matter of just trying to lay that plan out. I think in the early days we expected the regulatory process to go very smoothly and I think the second that we understood that that was not going to be the case, we adjusted pretty quickly.

    Feloni: So you got your first company for the exchange in September, and it'll go through in October. How did that feel and what does that mean for IEX?

    Katsuyama: Yeah, it's another huge milestone for us in a pretty long journey. There are 13 exchanges in the United States, but if you go on the street and you ask people who are the stock exchanges in the US, they'll say New York Stock Exchange and Nasdaq because where a company lists automatically creates a connection to that company, and in people's minds it validates those markets as exchanges. They've had a 40-year-old duopoly in listing major companies. They've kept people out through the regulatory process partly, partly by fighting them every step of the way. It's been a battle for us. Whether it's lawsuits, lawsuits threatened against the SEC, the lobbying, it's all that. We've lived through all of it.

    If you have a duopoly you don't want competition, and I think for us, No. 1, it represents competition and, No. 2, when I look at companies and I look at the shareholders that they have, IEX's big support and backing come from investors. Long-term investors. The big ones. We continue to grow because of them, and then I look at companies. And really these companies are listed on the NYSE or Nasdaq. They've been hugely underserved, right? All of the innovation in the market certainly benefited high-speed trading. But how has that benefited the company? So for IEX, our biggest value is taking the investors and the companies and aligning their interests with their exchange.

    Interactive Brokers, as our first listed company, we couldn't have written a better script. Here is company that has innovated in the market. It's one of the largest brokers that there is. Their chairman, CEO, founder, Thomas Peterffy, for me, has been an inspiration. I followed his career. People call him the father of electronic trading. But, using technology to help investors, to help lower costs. That's what Interactive Brokers has done. We're on the same side of this debate to say, listen there's a part of high-frequency trading that is not good whatsoever and the exchanges have essentially enabled that.

    The problem with breaking a duopoly is there's always risk to someone going first. Who is going to go first? The risk here isn't actually that high, and it took someone sophisticated to understand that but I think having someone that knows the markets, understands market structure go first, it sends an amazing signal to a lot of other companies, whether you're in finance or not, that this is a move you can make.

    Feloni: Has it made those conversations that you're having with companies easier?

    Katsuyama: I mean, absolutely. The interest level after the Interactive Broker switch has been tremendous. What's funny is that when people start to think about competition, if you do an inventory that says OK, what has my exchange done for me recently? And your answer to that is I don't know. That's a huge problem, right? They collect about $750 million a year from these companies that are listed there. This is a sector that is in desperate need of competition. Overcharging for the service and underdelivering on that service. We see this as just a huge opportunity.

    Keeping a healthy boundary between work and his personal life

    Feloni: And as someone who's building his own business and someone who's served a long time in a big corporation, looking at all of this, how do you personally define success?

    Katsuyama: What's funny is that some people have that barometer where it's about money. And I could not tell you if you asked me, if you had a gun to my head right now and said, "What's the value of your stake in IEX?" I would miss it. I would be wrong. I don't know. So that tells me it's not about money.

    I think success is about building a company that lasts, that people are proud to work at, that my kids could work at some day. And that's not measured in dollars.

    I think success is having a balance between what's important to you inside of work and what's important to you outside of work. And I think some amount of balance means that the most important thing in my life is not just work. I think people equate success to work. I actually don't, and I learned the lesson early that identifying yourself too much with one thing in a way sets you up to be dramatically disappointed at some point.

    If I defined my life around IEX, at some point in time I might not be the right leader for IEX. So I would step down if the company believed there was a better leader. I'd step down tomorrow if the company honestly believed that there was a better person to lead the company. I would do it. I actually think that's what makes our company work. I'm the leader because I think I'm the best person for the job. I'll hire people that I think are more talented than me and I'll be very candid with people I'm friends with about whether they are doing a good job or not.

    It's a business. But it's not the only thing in my life. It's certainly not the most important thing in my life.

    So I think success is a really, really broad term. It's actually important to ask yourself that question as an individual because you can start to line up the things that you do on a daily basis behind what your view of success is.

    Feloni: Well thank you, Brad.

    Katsuyama: Cool. Awesome.

    SEE ALSO: A 27-year-old promoter and restaurateur explains how he built a million-dollar business with clients like Drake, Lil Wayne, Mary J. Blige, and Floyd Mayweather

    Join the conversation about this story »

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    elon musk

    • Tesla credit default swaps, an insurance product designed to protect against a default, surged to their most-expensive level on record Friday.
    • The scramble for insurance comes as the SEC filed a suit against CEO Elon Musk for his now-infamous go-private bid that ended in the company remaining public. 
    • Follow Tesla's stock price in real-time here. 

    The Securities and Exchange Commission's suit against Tesla CEO Elon Musk is wreaking havoc on more than just the company's stock price, which fell 12% Friday.

    On Friday, in the wake of the lawsuit, traders were paying a record amount morning to insure against any possibility of the company defaulting on its debt. That insurance, sold as credit default swaps, or CDS, was going for roughly $295,000 to protect $1 million worth of Tesla bonds, according to Reuters.

    Tesla currently has $11.5 billion in outstanding debt, the biggest holder of which is the European insurance giant Allianz. At the end of February, $920 million of that debt is set to come due and has a convert price of $360. Tesla is currently trading 33% below that price, signaling it will likely come due as cash instead of equity for holders of those notes.

    Most Wall Street analysts agree that Tesla will need another cash infusion before it reaches profitability— and new capital could be harder to come by after this lawsuit — especially if Musk is forced to step down from the helm, an option sought by the SEC in its suit.

    "To be clear, near-term if Tesla is able to ramp the Model 3 over the coming quarters, we believe cash flow should improve," Joseph Spak, an analyst at RBC Capital Markets said Friday. "Having Elon Musk as CEO has undoubtedly made that easier in the past. Securing attractive funding in the future could be more difficult."

    There is one wonky option, however, that would involve pledging Tesla's intellectual property as collateral for new loans. There's one big caveat to that plan as put forward by Covenant Review, and involves a foreign entity stepping up much like Musk claimed Saudi Arabia's Public Investment Fund was prepared to do.

    Tesla shares are down 15% this year. 

    Now read:

    Tesla stock price

    SEE ALSO: 'Lawsuit secured': Here's what Wall Street is saying about the SEC's lawsuit against Elon Musk (TSLA)

    Join the conversation about this story »

    NOW WATCH: I woke up at 4:30 a.m. for a week like a Navy SEAL

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    lebron james lakers

    • The Los Angeles Lakers roster will require LeBron James to adapt to a different style of play to make the system work.
    • There is skepticism about whether James will adapt because, historically, he doesn't play at a fast pace or play off the ball much.
    • Though the Lakers figure to be a good team, skepticism remains about how all of the pieces will fit together.

    After landing LeBron James in free agency, the Los Angeles Lakers put a different-looking team around him, with the hopes of executing a different style than the Cleveland Cavaliers.

    In signing players like Rajon Rondo, Lance Stephenson, and JaVale McGee to join James and their young, talented core, the Lakers decided to add playmaking around James rather than shooting.

    Early reports suggested the Lakers also hope James will move to the post more this season. Such a move would not only help the Lakers' spacing on offense but also ease the burden on James to create as much off the dribble.

    With training camp underway, the Lakers have said they plan on playing fast on offense (they were third in pace last year). Head coach Luke Walton hasn't offered many clues about the team's half-court offense, but he did say he'd like to see more hard cuts, screening, player and ball movement.

    It all sounds good in theory, and with preseason and the regular season rapidly approaching, the NBA world will soon get a chance to see the Lakers' offense in action. But, on paper, there's still a significant question about the fit — will James do the things that the Lakers need to make the offense click?

    LeBron hasn't played the way the Lakers want to play.

    James told reporters that he envisions the Lakers playing like his Miami Heat teams from 2010-2014.

    "I think it will be kind of similar to Miami in a sense of we really got out and started with our defense, and got out and ran," James said. "You get out and run, you're able to get down the floor before they set their defense. There's a lot of good defenses here in our league, so to be able to get stops and get out and run, you get down the floor before the defense gets set up."

    Looking back on it, the Heat were known for their transition talent but didn't consistently get out and run. The Heat never ranked higher than 15th in pace during James' four-year tenure and never finished in the top 10 in fastbreak points (they were 11th in 2011-12). The Heat did boast elite defenses that led to fastbreak opportunities, but they were never quite a run-and-gun team.

    The Cavaliers weren't a fastbreak team, either, though they did quicken in the last two seasons, finishing 16th and 12th in pace.

    Throughout James' career, and particularly in recent years, James has been much more of a methodical, half-court ball-handler than a fastbreak weapon. James' athleticism, of course, allows him to dominate in transition when such opportunities arise, but he doesn't play at that speed consistently. James was one of the slowest players in the league last year — his average speed was 3.88 miles per hour, the 10th slowest among players who played at least 1000 minutes, according to the NBA's tracking data.

    So, no, James historically has not liked to play fast. It would be a surprise if that changed in his 16th season, as he approaches 34 years old.

    LeBron likes to have the ball.

    It's also fair to question whether James will gladly play off the ball. James will, of course, still be a playmaker and have the ball in his hands a lot  — the Lakers aren't asking for a complete reversal — but in recent years, James has become more ball-dominant than ever.

    Last season, James was 10th among all players in average time per "touch" at 6.7 seconds, according to the NBA's tracking data. The top players were all point guards, which makes sense — point guards bring the ball up the floor and run the offense; of course, they touch it more. James essentially functioned as the Cavs' point guard last year.

    But this isn't new. In 2016-17, James averaged 6.4 seconds per touch, and that was while sharing the ball with Kyrie Irving. He averaged 5.3 seconds in 2015-16 and 6.5 seconds in 2014-15. 

    Last season, James wasn't necessarily a quick decision-maker when it came to taking his shot. According to tracking data, 32% of James' shots came after seven or more dribbles, 26% occurred after 3-6 dribbles, and 23% were after no dribbles, i.e., a catch-and-shoot opportunity.

    Likewise, 43.4% of James' shots came after touching the ball for six seconds or more, 34% were after James touched the ball for 2-6 seconds, and 22% occurred after having the ball for fewer than two seconds.

    According to the data, James' efficiency increased when he held the ball less, posting a ridiculous 75.5% eFG (which takes three-pointers and two-pointers into account) when he touched the ball for two seconds or less.

    James is not a ball hog — he's one of the least selfish players in basketball and one of the best passers. But James likes to play based on matchups. When James has a matchup he thinks he can exploit, he'll take things into his own hands.

    James is such a physical force that it's hard to make a better game plan than James forcing the defense to react, then making a play.

    One league source familiar with James once told Business Insider that it could be difficult to coach James because James' style of play is often better than any system.

    "LeBron will break the system all the time to do what he does," the source said. "And he does it so well that coaches don't have the intestinal fortitude to say, '[My system is] better.' Because he's like, 'Really? It's better than that?'"

    But for the Lakers to succeed, James will have to change his style a bit. One scout told Yahoo's Chris Mannix:

    "It will be interesting to see how much LeBron is willing to change his style. If he is going to dominate the ball, with this roster, it won't work. They have a lot of guys who want to dribble. Luke is going to have to work to get them to play together."

    It all boils down to an awkward roster.

    Therein lies the confusion about the roster the Lakers built around James. Additional playmaking is good, and if everyone buys in, they have the ball-handlers and athletes to be a true run-and-gun team. But if James has the ball in his hands, defenses won't pay much attention to players like Rondo, Stephenson, or Lonzo Ball. The only real solution is to have James play off the ball more or to have an intricate system of cutting and passing — whether players like James and Rondo buy into such a system remains to be seen.

    But former Cavs GM David Griffin said this summer, having James off the ball will only work for so long. In the playoffs, the Lakers will want their best player to have the ball.

    "He's the single most efficient play creator in the playoffs in all of the NBA," Griffin said. "So because of that, you want him making decisions. You want him creating those opportunities. And you're not going to create them for a Rondo jump shot. You're not going to create them for a Lance Stephenson jump shot."

    James' talent alone should keep the Lakers in the playoff hunt. If any of their young players take the next step and their role players blend in, they should be a scary team in the deep and competitive Western Conference.

    But when the Lakers built this team, the NBA world was immediately skeptical of how it can all work. Even with games just around the corner, skepticism remains about how this team will fit together.

    SEE ALSO: Nearly 3 months later, the biggest topic around the NBA is LeBron James' move to the Lakers and how it's changed the league

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    Ben Friedman Citi

    • Citi group is adding more young talent to its revamped bond-trading unit.
    • Over the summer, Citi hired 32-year-old Sam Berberian from Goldman Sachs to run junk bond trading. 
    • Now, Citi is adding Ben Friedman, a late-20s standout portfolio manager at $17 billion hedge fund CQS, to work for Berberian, according to people familiar with the matter.

    Citigroup has added another rising star to its new-look bond-trading unit. 

    In June, the company poached Sam Berberian, a coveted 32-year-old high-yield trader at Goldman Sachs, to run its junk-bond trading operation under Vikram Prasad, the head of credit trading.

    Now, Citi is adding Ben Friedman, a late-20s standout portfolio manager at $17 billion hedge fund CQS, to work for Berberian, according to people familiar with the matter.

    Citi, CQS and Friedman declined to comment. 

    It's another big win for Citi's fixed income markets division, which is overseen by Mickey Bhatia and Joe Geraci and has been reloading talent since a recent spate of senior departures in its high-yield debt unit. 

    Citi is a top player in the fixed income, currencies, and commodities business, ranking second behind JPMorgan Chase in 2017 and the first half of 2018, according to industry consultant Coalition.

    It's a return to the sell-side for Friedman, who traded debt for Bank of America Merrill Lynch for four years before jumping to CQS in 2015, according to his LinkedIn profile. 

    Friedman made the Forbes 30 Under 30 list in 2017 at age 27, and at the time he was managing nearly $1 billion in high-yield and distressed debt at CQS, which raked in profits of $160 million last year, according to Financial News.  

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    NOW WATCH: Ray Dalio says the economy looks like 1937 and a downturn is coming in about two years

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    Mark Zuckerberg

    • Facebook announced a major new security breach on Friday.
    • 50 million users accounts were affected by the attack, in which attackers were able to take over users' accounts.
    • It's not yet clear who's behind the attack.

    Facebook just disclosed a major new hack affecting almost 50 million users.

    The Silicon Valley tech firm discovered on Tuesday that attackers had taken advantage of a security flaw to take over users' accounts. The company's stock dropped 3% on the news.

    Facebook's VP of Product Management Guy Rosen wrote in a blog post announcing the news on Friday: "Our investigation is still in its early stages. But it’s clear that attackers exploited a vulnerability in Facebook’s code that impacted 'View As', a feature that lets people see what their own profile looks like to someone else. This allowed them to steal Facebook access tokens which they could then use to take over people’s accounts.

    "Access tokens are the equivalent of digital keys that keep people logged in to Facebook so they don’t need to re-enter their password every time they use the app."

    Facebook says it's not yet clear who is behind the attack.

    The company is holding a press call on Friday morning with the media; Business Insider will attend and update this story with more information as it becomes available. 

    This story is developing... 

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    NOW WATCH: British Airways has a $13 million flight simulator that taught us how to take off, fly, and land an airplane

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    makeup expiration date symbol

    By now, you probably already know that there's a secret bear in Toblerone's logo, that NBC's logo is actually a colorful peacock, and that Burger King's logo is just a giant hamburger.

    But did you know that there are three tiny letters hidden on almost every penny in the US? Or that Bluetooth's symbol is a combination of two ancient Danish runes?

    From Amazon to the USB icon, we rounded up 25 objects, brands, and photos that have hidden symbols, surprising origins, or lesser-known meanings. Check them out below.

    Every penny created by US Mint since 1918 has three tiny letters engraved on Lincoln's shoulder.

    The three letters, "VDB," are the initials of Lithuanian-American medalist Victor David Brenner. Brenner designed the portrait of Abraham Lincoln that has been used on the one-cent coin since 1908.

    Coca-Cola's new winter-themed can features a group of adorable polar bears — plus a few hidden details.

    Reddit user sunkist268 recently noticed that the polar bears' eyes are actually bottle caps, and the shiny marks on their noses are actually small bottles.

    There's a tiny symbol on most makeup and beauty products that tells you how long an item can be kept or used after opening.

    The PAO, or "Period After Opening" symbol, appears on any cosmetic product with a shelf life of 30 months or more. It was introduced by the European Commision in 2005.

    See the rest of the story at Business Insider

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    CC Sabathia

    • New York Yankees pitcher C.C. Sabathia has an incentive-based bonus in his contract that awards him with $500,000 for pitching 155 innings this season.
    • Heading into Thursday's game against the Tampa Bay Rays, the left-hander had to pitch in seven innings to earn the bonus.
    • In an increasingly contentious four-game series, the 10-year Yankee pitcher retaliated for an earlier incident, drilling Rays catcher Jesus Sucre with a 93 MPH fastball.
    • Sabathia was ejected from the game two innings shy of receiving the bonus.

    Had veteran New York Yankees pitcher C.C. Sabathia made it through seven innings of Thursday's contest against the Tampa Bay Rays, he would have been awarded a $500,000 incentive-based bonus.

    But instead, the left-handed pitcher made a conscious decision to defend teammate Austin Romine.

    In an increasingly heated four-game series, Rays pitcher Andrew Kittredge targeted Romine and just missed hitting his head in the top of the sixth inning. Sabathia was visibly frustrated, stepping out of the dugout while head coach Aaron Boone held him back.

    The 10-year Yankee pitcher stepped to the mound in the following inning and threw a 93 MPH fastball into Tampa Bay catcher Jesus Sucre's left thigh. Sabathia was immediately ejected from the game, but it didn't stop him from cursing and barking "that’s for you" at the Rays' dugout.

    Here's a video of the pitch and his ejection:

    "I don't really make decisions based on money, I guess,"Sabathia said after the game. "Just felt like it was the right thing to do."

    To be fair, the $500,000 deficit will not make too much of a difference for Sabathia, who has earned more than $252 million over the course of his career in the MLB. Still, the 38-year-old may have devoted his final pitch in Yankee pinstripes to retaliating on Romine's behalf.

    Questions were surrounding Sabathia's return for this season, and while the southpaw has indicated an interest in playing beyond the year, his future with the franchise remains uncertain.

    "I'm [going] start to start,"Sabathia told Jon Paul Morosi of in July. "I go out one start and feel like I can pitch five more years. I go out another start and I'm [feeling] done. But if I can stay healthy -- if my knee holds up -- hopefully I'll play one more."

    New York manager Aaron Boone—who was thrown out alongside Sabathia—understood his starting pitcher's decision, even though the Yankees were leading by 11 runs at the time.

    "There's no question there was intent. You've had some guys hit this series, and then you throw one over the head? Just kick rocks. I hated it,"Boone said. "If you're going to play that game and you start messing around with people's heads, we're going to take exception to that."

    Many of Sabathia's teammates supported his actions as well:



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    A F-35B Lightning II aircraft from the Marine Fighter Attack Squadron 211 launches from the deck aboard the amphibious assault ship USS Essex

    • A US Marine Corps Lightning II Joint Strike Fighter crashed Friday in South Carolina less than 24 hours after it made its combat debut in Afghanistan.
    • This incident marks the first F-35 crash in the 17 year history of the F-35 program.

    A US Marine Corps F-35B Lightning II Joint Strike Fighter crashed in South Carolina on Friday, just outside Marine Corps Air Station in Beaufort, according to ABC News and other media outlets, citing military officials.

    The pilot is presumed to have ejected, but the airman's status is unknown at this time. The military aircraft, recognized as America's most expensive weapon, went down just before noon in a Class A mishap just five miles from the air station, the Beaufort County Sheriff's Office told The Herald, a local paper, reported. A Class A mishap is a serious incidents involving more than $2 million in damages or the complete destruction of the aircraft.

    MCAS in South Carolina is reportedly home to five F/A-18 squadrons and one squadron of F-35Bs.

    The incident comes just one day after a US Marine Corps F-35B achieved a major milestone in Afghanistan, where the aircraft made its combat debut Thursday against Taliban targets. While their have been accidents, fires, and incidents, such as when an F-35B burst into flames two years ago, this marks the first F-35 crash, the Marine Corps told Business Insider.

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    Kerryon Johnson

    What a week!

    If you followed our DraftKings tips last weekend, you probably won some cash, thanks to stacking Matt Ryan and Calvin Ridley together — both at a great value.

    Tyler Boyd, Matt Breida, and Sammy Watkins also had stellar days, making for our best week of DraftKings' value picks so far this season.

    But as the name implies, daily fantasy is changing all the time, and this week we're back at it again, with picks at every position that look set to outplay their pricing.

    QB: Eli Manning, $5,600

    The Giants offense finally looked as many hoped it would last weekend, with Odell Beckham Jr. and Saquon Barkley both showing up in an impressive way. This week with the Saints heading to New York, Eli Manning is a solid value as one of the cheaper quarterback options on the board. The Saints defense has given up 34 points per game, and if the Giants offensive line can hold, Manning should have plenty of opportunities to take advantage.

    RB: Austin Ekeler, $4,200

    Austin Ekeler had a bit of a down week last week against the Rams, but with the Chargers hosting the 49ers this week, he should be featured a bit more in the Los Angeles offensive attack. It's easy to imagine the Chargers jumping out to an early lead and leaning on Ekeler during some long drives in the second half.

    RB: Kerryon Johnson, $4,400

    Last week, Kerryon Johnson became the first Lions running back in years to rush for more than 100 yards. This week, he's going up against a Cowboys offense missing its centerpiece in linebacker Sean Lee. Detroit is undoubtedly a pass-first team, but there's little doubt they'll turn to Johnson to establish the running game in Dallas.

    See the rest of the story at Business Insider

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    Halloweeen Express

    • Toys R Us and Babies R Us stores closed for good earlier this summer, and some are now being resurrected as Halloween costume shops. 
    • Stores like Spirit Halloween and Halloween City, which are only open for a few months each year, are setting up shop in abandoned Toys R Us and Babies R Us stores.
    • But signage, wallpaper, and other remnants of the defunct toy retailer are everywhere, making the stores even more eerie, according to shoppers who shared their experiences on Twitter.

    All of the Toys R Us and Babies R Us stores in the United States closed for good in June, after the company filed a motion to liquidate its business. Toys R Us had filed for Chapter 11 bankruptcy protection in September 2017.

    Toys R Us' and Babies R Us' closing left more than 700 empty storefronts across the US. 

    Now, some of those stores are being resurrected as Halloween costume shops. 

    For temporary Halloween stores like Spirit Halloween and Halloween City, which are only open from late August through early November, the summer Toys R Us closures provided the perfect opportunity to move in.

    Some who have visited the repurposed Babies R Us locations are calling the Halloween stores the "hermit crab" of retail, waiting for empty stores to pop up so they can move in.

    But remnants of the toy stores are everywhere. The Toys R Us wallpaper and logo are still hanging, the colorful checkered floors are still in tact, and giant photos of babies are hanging over creepy costumes.

    And people are finding it, well, creepy. Some shared their reactions on Twitter.


    SEE ALSO: We visited 3 Toys R Us stores that are about to shut down — and it was a depressing look at a business at its end

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    oprah winfrey

    • Oprah Winfrey's net worth is $2.9 billion, according to Forbes.
    • She spends her fortune on property across the globe, a private jet, vacations for her friends and staff, and investments in health and wellness-oriented companies.
    • Winfrey also donates time and money to a variety of philanthropic causes.

    Oprah Winfrey came from humble beginnings— now she's worth $2.9 billion, according to Forbes.

    So what exactly does she do with all that cash?

    We took a look at Winfrey's spending habits over the last few decades, and learned that she's got property across the globe and a private jet — but she also supports a range of philanthropic causes. And she's been known to take her friends and staff on lavish vacations, including "glamping" in Yosemite and a 10-day cruise.

    Find out more about how Winfrey spends her money:

    SEE ALSO: The life and career of Oprah Winfrey, who was nominated for an Oscar and lives in a $52 million estate nicknamed 'The Promised Land'

    Oprah Winfrey is a media mogul, a philanthropist, and an actress.

    Her current net worth is $2.9 billion, according to Forbes.

    Source: Forbes

    Winfrey spends her fortune many ways, purchasing real estate across the globe, investing in businesses, and supporting philanthropic causes.

    See the rest of the story at Business Insider

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    • Personal Capital, a personal finance and wealth management company, is hiring a "manager of SEC reporting."
    • The job posting could be a hint at IPO aspirations for the California-based startup.
    • A spokesperson told Business Insider that an IPO has always been the plan but couldn't say how near one may be. 

    Personal Capital, a financial site that allows users to connect all of their accounts to see their money in one cohesive dashboard, appears to be gearing up for an initial public offering.

    The company published a job listing on Wednesday afternoon seeking a "Manager of SEC Reporting & Technical Accounting" in its Redwood Shores, California headquarters. According to the posting, this person "is responsible for providing technical expertise and support for the SEC filing and compliance related reporting and technical accounting functions for a pre-IPO company."

    The person will also lead preparation of regulatory filings required of companies to list publicly on a stock exchange, it said.

    A spokesperson told Business Insider that its "no secret we want to be IPO ready" and that this job posting is "in keeping with that plan." The representative could not provide details on a timeline for the IPO, and pointed to previous public statements by CEO Jay Shah noting it was a potential option. 

    Other companies have posted similar job openings just a few months ahead of an S-1 filing, the first regulatory document required for an IPO. In speaker maker Sonos' case, the job apps were posted in April and an S-1 filed in July. 

    Personal Capital's product works under a simple premise: connect all of your financial accounts and see them all in one place. These can include simple savings and checking accounts, credit cards, investments held via a broker like Robinhood. 

    The service is free for anyone to use, and the company then sells financial planning and wealth management services to high net-worth customers. CEO Jay Shah told Business Insider last year that paying customers have Personal Capital manage about $300,000 on average. Advisory fees are proportional to assets managed, and start at 89 basis points down to 49 basis points for wealthier customers.

    Other brokerages, like TD Ameritrade, have been forced to invest heavily in similar dashboards to compete with these free services like Personal Capital or Mint, which is owned by Intuit. 

    Personal Capital

    Currently, 1.5 milion users are tracking more than $550 billion through the site. Data from all those accounts allows Personal Capital to give customers a personal "you index" to compare with benchmark indices like the S&P 500. The company also personally manages about $8 billion worth of assets for customers

    As a private company, Personal Capital has raised roughly $215 million in venture capital across nine rounds over as many years.

    "Our mission is better financial lives through technology and people," Shah said in the interview last year. "We have a segment of our free user base that will just continue to use our free software and that's just fine, we're doing something that we think is slightly philanthropic and trying to help people see and understand their financial lives.

    "When it comes to people that have complexity and substantial assets, we have found that when they engage and when they look at what we offer as a solution, they find value there," he continued.

    SEE ALSO: A hot fintech startup has amassed nearly $5 billion from people willing to hand over their bank logins

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    David Neeleman TAP

    • David Neeleman is one of the most prolific and successful airline entrepreneurs in the world.
    • He's the founder of JetBlue and Azul as well as a co-founder of Morris Air and WestJet.
    • Neeleman is also a co-owner of TAP Air Portugal.
    • The JetBlue and Azul founder shared with Business Insider some of his secrets to success in the airline business.

    David Neeleman is quite possibly the most prolific and successful airline entrepreneur in the world. He's the founder of JetBlue and Azul Brazilian Airlines as well as a co-founder of Morris Air and WestJet.

    He's also a co-owner of Portuguese national airline TAP Air Portugal.

    Earlier this year, the Brazilian-born, Utah-raised airline boss announced plans to launch his fifth airline, an American low-cost carrier called Moxy

    With WestJet, JetBlue, and Azul all thriving, Neeleman has been able to do something few entrepreneurs have been able to over the years, build an airline from scratch and turn it into a profitable business. 

    David Neeleman AzulRecently, Business Insider had the chance to speak with David Neeleman about why his airlines have succeeded when so many others have failed. 

    The first thing is to the get into the business for the right reasons and not just "for the sake of doing it."

    "Sometimes people do things, start businesses and get into the airline industry particularly because it's sexy and exciting, but they don't have a lot of experience," Neeleman told us in an interview shortly before he announced plans for Moxy. "There's been a lot of money lost in this business like that."

    According to Neeleman, investing in industries in which you have very little knowledge and experience is a surefire way to quickly fail. 

    You have to figure out whether there's an opening or opportunity in the marketplace for the business to fill, he said. 

    "I would never start an airline or take over an airline that I thought didn't have a reason for being, a 'raison d'être,'" Neeleman said. 

    David Neeleman JetBlueFor example, WestJet, which began service in 1996, came about when Canadian Pacific Airlines and its successor Canadian Airlines suffered through more than a decade of financial instability. With the possibility of Canada's second largest airline going defunct, there was room in the market for an upstart to take on the country's national airline, Air Canada, Neeleman explained. 

    Air Canada ended up acquiring Canadian Airlines in 2001. These days, WestJet is Canada's second largest airline.

    And then there's JetBlue. 

    According to Neeleman, JetBlue came about when he noticed that the shortcomings of America's major carriers made them vulnerable to a newcomer. 

    "It was a time when the legacy carriers were offering really bad service, their costs were ultra high, and they were just right for the plucking," Neeleman said. 

    In response, Neeleman founded JetBlue which calls itself a customer service company that flies airplanes.

    WestJet AirlinesThe New York-based boutique carrier, which launched in 1998, has successfully delivered low-cost carrier prices with friendly service and luxurious amenities. 

    After parting ways with JetBlue, Neeleman launched Azul Brazilian Airlines in 2008. A low-cost carrier with hints of JetBlue DNA.

    The entrepreneur noticed that many of Brazil's cities had airports, but no airline service. Azul has gone and filled in those service gaps. As a result, it's now the third largest airline in Brazil. 

    But things don't always work out and it's important to know when to get out, Neeleman said. 

    Neeleman co-founded his first airline, Morris Air, in 1984 and served as the company president until it was sold to Southwest Airlines for a reported $129 million in 1994

    "I sold Morris Air to Southwest because (the airline) was really vulnerable," he said. "I'm sitting in Delta Air Lines's hub in (Salt Lake City, Utah), I didn't have a lot of capital at the time and one of my guys told me 'you know if Delta just matched all your fares they'd be revenue positive' and take so much of our market share."

    Azul Brazilian Airlines Airbus A330Since Morris Air competed on price, Neeleman decided the most prudent thing to do was to sell.  

    "We were pretty vulnerable and Southwest wants us plus when someone hands you $15 million at 33 years old you're like 'Yeah! I'll take it,'" Neeleman said. 

    Finally, there's the need to build around loyal and competent people or as Neeleman put it, folks "who know what the heck they are doing."

    "I've got a team of people that's been with me since the early days," he told us. "I've got one person who is working with me at Azul that was at Morris Air."

    "Those guys and gals have always been at my side and they know how to run an airline," Neeleman added.

    SEE ALSO: JetBlue's founder explains why his new airline bought the $300 million Airbus jet that others don't want

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    How airplane wifi works two different ways wifi works on airplanes

    • Inflight WiFi has been a recent and increasingly important development in air travel.
    • Aircraft-based WiFi has gone through several generations of technology over the past decade.
    • WiFi tech has gone from low-bandwidth satellite-based systems to ground-based systems, and now back to high capacity satellite-based tech such as GX Aviation, Gogo 2Ku, and Viasat.

    As the society's need to be constantly connected increases, so has the pressure to have inflight WiFi systems on the world's airlines.

    Incredibly, inflight WiFi is a relatively recent development. For instance, Boeing didn't get into the business until 2001, while Airbus didn't enter the market until 2005. Gogo, one of the biggest names in the business didn't come online until 2008. 

    A decade ago, the industry was built on low-bandwidth satellite-based systems to transmit data to connect the aircraft with the internet. 

    These systems really couldn't handle a whole lot of traffic. 

    "Ten years ago, at best, you'd get your Blackberry to work and you'd get basic text email,"Honeywell senior director of connectivity services, John Peterson told Business Insider in an interview. 

    Next came the ground-based systems. 

    To get higher data rates, in the United States, they went to ground-based systems," Peterson said. "And these systems got you into what you would call 3G cellular type speeds."

    This speed allowed passengers to have web browsing capabilities and the use of smartphone apps. However, these systems depend on ground-based transmitters, which means they only work overland. 

    Unfortunately, the experience for many travelers has been expensive and somewhat disappointing. The limited bandwidth of the ground-based system has not been able to keep up with the speed at which technology and data needs have increased. 

    This is because inflight wifi systems are incredibly expensive and have longer lifecycles than your everyday consumer electronics. 

    "When was the last time you replaced your phone? A year? Maybe Two years ago? Inflight wifi systems are expected to last five or ten years before they are upgraded," Peterson told us. 

    However, there looks to be light at the end of the tunnel.

    According to Honeywell, its hardware helps GX Aviation use Inmarsat's Global Xpress network of Ka-band satellites to achieve speeds of up to 50 Mbps to the plane. Gogo's 2Ku service promises 100Mbps to the plane and 15Mbps of speed to each passenger while Viasat can deliver up to 12 Mbps per passenger and 200 Mbps to the plane. 

    With next generations inflight wifi systems, "passengers are going to get an experience closer to what they are used to getting in their living rooms," Peterson said.

    SEE ALSO: The amazing story of how the Airbus A320 family became the Boeing 737's greatest foe

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    Nike by Melrose

    • New technology is increasingly being infused into stores, and the results are finally starting to show.
    • Tech-forward companies like Amazon and Nike are completely changing the idea of what it means to have a physical store.
    • Nike's Live concept store, which chooses items to stock by analyzing customer data, and Amazon's Go concept, which uses just-walk-out technology instead of cashiers, are two examples of how the way the industry is thinking about stores is changing.

    Retail is changing faster than ever.

    Though there has been a lot of talk about how online shopping is changing the retail landscape, forcing traditional shopping centers like malls to close, it's only now that the future of the industry is truly coming into focus.

    And yes, it's digital, just as we were promised.

    Amazon and, more recently, Nike, have debuted store concepts that put their digital smarts front-and-center as they offer new experiences to customers.

    Nike lives out loud

    Nike is using data pulled from online purchases to inform the products stocked in its new store, which opened in July. 

    It's the first Nike Live concept store, which seeks to maximize speed and convenience by combining digital offerings with a 4,000-square-foot physical retail location.

    Called Nike by Melrose, the store is a representation of favorites of customers in the area — in this case, the West Hollywood part of Los Angeles. Much of this information was gleaned from customers using Nike's online services, whether they were shopping on or were members of Nike Plus.

    Nike by Melrose

    For example, Los Angeles-based customers buy a lot of the Nike Cortez, a retro-styled, low-cut sneaker. Nike knows that from observing their shopping habits, and so it can then stock more of the shoe in more colors and feature it prominently.

    The store is stocked with products in categories like lifestyle and running, which are two of Nike's most popular, and it is predominantly focused on serving customers who care about both style and fitness. The store stocks both men's and women's products but allows for variation based on each gender's preferred styles.

    That marriage of digital prowess and physical store experience is the hallmark of Nike Live stores.

    "This much more represents how consumers are thinking about shopping. They don't put the wall up between physical and digital," Heidi O'Neill, president of Nike's direct-to-consumer business, said to Business Insider during a visit to the new store shortly after its opening. 

    Customers can also use the Nike retail app to scan products' barcodes and find out more information about them, including the sizes and colors the store has in stock.

    Nike is also adding convenience-oriented features like curbside pickup and digital reservations in lockers that customers can open with their phones. 

    With Nike Live, the company will have what you want, where you want it — and it will help you get it with as little friction as possible.

    Future Nike stores, like the flagship stores currently slated to open this fall in both New York City and Shanghai, will incorporate some elements of Nike Live, CEO Mark Parker said in the company's earnings call this week.

    Amazon Go creates a 'magical' new experience

    Amazon opened its first cashierless Go store in late January.

    The store features Amazon's "just walk out" technology, which uses sensors and cameras to track what customers take off shelves and out of the store. Located in Seattle, near Amazon's campus, it's seen by many as the future of brick-and-mortar retail, with complicated technology that's designed to make in-store shopping as seamless and easy as shopping on

    With no lines or checkout process, the store uses cameras and sensors to track what you put in your basket. It then charges you through your Amazon account.

    The store opened to the public on January 22 after a lengthy beta period. The opening of the store brought a lot of interest from locals, and lines soon formed on opening day.

    Amazon Go

    In a letter to investors, Amazon CEO Jeff Bezos spoke with pride about hearing customers call the experience of shopping in the new store "magical."

    Amazon has since expanded its Go footprint to four locations, three in Seattle and one in Chicago, with more on the way in cities like New York and San Francisco.

    The company could have an even more ambitious plan to expand Amazon Go. It wants to have at least 10 stores open by the end of this year, then 50 in 2019, then possibly a rapid expansion to about 3,000 by 2021, Bloomberg reported, citing people with knowledge of the matter.

    Brick-and-mortar stores are changing forever

    Taken together, Nike Live and Amazon Go chart a new course for retail that is unconstrained by what came before, and they offer new opportunities to get products to customers more efficiently than ever.

    The advent of tech-focused physical stores proves that brick-and-mortar retail isn't going anywhere soon.

    "Physical retail is clearly not dead," retail consultant Steve Dennis writes in a contributor post on Forbes. "Far from it, in fact. But, to be sure, boring, undifferentiated, irrelevant, and unremarkable stores are most definitely dead."

    In fact, what's happening now is what Deloitte calls a "retail renaissance," fueled by new technology and data-centric insights into customers' habits and characteristics. 

    "A sea change is clearly taking place in the retail market — but it is not the retail apocalypse. In our view, it is instead a renaissance — driven by huge shifts in economics, competition, and consumer access to options, all fueled by exponential advancement in technology," Deloitte wrote in a March 2018 research report. "And in this renaissance, the winners appear to be those retailers that can capitalize on consumers' experiences of their economic well-being — or lack thereof — to offer a value proposition that aligns with consumer needs."

    SEE ALSO: Amazon is launching a better version of the post office in cities around the country. Here's what it's like to use.

    Join the conversation about this story »

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    13 best places to travel in november

    • To find the best places to visit in November 2018, Business Insider looked at climate data, cultural calendars, and peak travel times.
    • November is outside peak tourism season for most destinations, meaning you can save a bundle on airfare and hotels and won't have to battle throngs of tourists.
    • The best places to visit in November include the home of the breathtaking Lantern Festival in Thailand, foliage-rich Boston, and a "strange and alien landscape" in Namibia.

    November is firmly outside of peak tourism season for many of the top destinations in the world.

    But that's exactly it's the right time for an end-of-year vacation. Between the thinning crowds and the cash you'll save on hotels and airfare, there are plenty of reasons why you should be looking at a November getaway.

    We looked at airfare trends, climate data, and cultural calendars to select 13 vacation spots that are some of the best places to visit in November. They include the home of a spiritual lantern festival in Thailand, a city where you can catch the end of New England's foliage season, and a "strange and alien landscape" in Southern Africa that has to be seen to be believed.

    These destinations offer something for every traveler, whether you're a beach lover, a thrill seeker, a history buff, or someone who likes to explore uncharted territory. Read on for the 13 places you should visit in November, and plan away.

    SEE ALSO: The 13 best places to visit in October for every type of traveler

    DON'T MISS: The 13 best places to visit in September for every type of traveler

    Boston, Massachusetts

    Visit Boston in November and you'll catch the tail end of fall foliage season. Boston Common and the adjacent Public Garden are two especially popular places to see the stunning reds, yellows, and oranges.

    If you can withstand the crisp New England temperatures, November is the perfect time to take a stroll around this hotbed of American history. And the weekend before Thanksgiving, there's no better place to visit than nearby Plymouth, the birthplace of the holiday, for its annual America's Hometown Thanksgiving Celebration.

    San Diego, California

    San Diego is by no means a summer-only destination.

    In fact, November may be the one of the best months to visit this laid-back California city — the weather remains in the 60s and 70s, you'll save a bundle on hotels and airfare, and the summertime crowds will have long departed.

    It may be a tad too breezy for a day at the beach, but if events like San Diego Beer Week, the San Diego Jazz Fest, and the San Diego Bay Wine and Food Festival are more your speed, then November is the month for you.

    Kauai, Hawaii

    November is one of the cheapest times of the year to fly to Hawaii (although February takes top honors in that department).

    Like the rest of Hawaii, Kauai's climate barely changes from month to month, with highs in the mid-70s Fahrenheit. 

    What sets Kauai apart is its lush scenery and serene beauty. You won't find too many mega-resorts or throngs of tourists here, just stunning wildlife, friendly people, and good vibes.

    See the rest of the story at Business Insider

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    facebook virtual reality rob price oculus quest

    • Facebook unveiled the Oculus Quest, its first standalone virtual reality headset that tracks where you are in a room.
    • Business Insider got to try it out.
    • It's a remarkable device, but it still has some obvious shortcomings.
    • However, it points to a wild future ahead for virtual reality.

    I got shot in the head on Wednesday.

    Crouching behind a wooden crate in the desert, I was caught in a gunfight when a stray bullet hit me square in the face. My vision went red; I was dead — until I respawned 10 seconds later, after running behind new cover.

    I was at Facebook's big virtual reality conference, Oculus Connect, in San Jose, California, trying out the latest VR headset from the Silicon Valley tech giant. The new device, the Oculus Quest, is slated for a Spring 2019 launch, and attendees were given the opportunity to test it out in a series of demos at the event.

    It's the first major virtual reality headset that is both completely standalone and able to track a user's location in the real world — meaning you're freed from having to place external sensors or lug around a backpack-mounted computer to power the experience.

    oculus quest headset

    From my admittedly brief time with it, it was a significant step towards the future promised by virtual reality boosters — fully immersive virtual environments, accessed through a simple headset — but the technical shortcomings of the present were still on clear display.

    I got to try out two demos. One was Project Tennis Scramble, a quirky tennis game where you face off against a real-world opponent in virtual reality, as the racket and ball morph into quirky sports objects like golf clubs and beach balls. 

    During the demo, the headset felt a little heavy on the face, and the Oculus Quest's motion-sensitive hand controllers struggled to return the ball in the direction I was intending — though I am admittedly terrible at real-world tennis, so I may not be the best judge of this.

    oculus quest tennis

    Significantly more impressive was Dead & Buried, a Wild West multiplayer shooter that was being held in a 4,000 square foot arena. Teams of three faced off against each other, hiding behind real-world objects that corresponded to pillars and crates in a virtual world. 

    It felt exciting and immersive, and the first time I got shot, I involuntarily jolted backwards. It was surreal to feel real-world objects corresponding to the virtual environment. And the standalone headset meant I felt unimpeded by wires or additional equipment, free to run around the area as I wished.

    In contrast: During demos of the older Oculus Rift headset, which must be tethered to an external computer, Oculus employees had to hold attendees' cables for them to they didn't get tangled in them.

    facebook oculus rift

    This freedom, alone, makes it a significant step foward. And it makes it a far more compelling product than the likes of the Oculus Go, which, while standalone, can't ascertain users' real-world position or head motions, making it little more than a toy.

    But it still fails to to solve any of the fundamental problems bedeviling virtual reality. It's bulky and heavy, and will be draining to wear on your face for long periods. You can't focus well on virtual objects close to you. And while it demoed well in carefully controlled environments, it's not yet at all clear how it will perform in people's actual homes. 

    During the event keynote on Wednesday, Facebook CEO Mark Zuckerberg said that the company believes it needs about 10 million users on a VR platform to actually be self-sustaining and making it worth developers' time to keep building for it.

    But a Facebook representative I interviewed refused to commit to hitting that target for Oculus Quest sales, stressing that it's only the first generation of products — suggesting the company isn't exactly convinced it will be a commercial success.

    oculus quest facebook

    Without trying it extensively in "real" environments, away from Facebook's minders, I'd be hesitant to recommend anyone buy the Oculus Quest — and even then, it would come with caveats.

    But it's still remarkable — and demonstrates the potential of virtual reality more clearly than ever.

    Got a tip? Contact this reporter via Signal or WhatsApp at +1 (650) 636-6268 using a non-work phone, email at, WeChat at robaeprice, or Twitter DM at @robaeprice. (PR pitches by email only, please.) You can also contact Business Insider securely via SecureDrop.

    SEE ALSO: Facebook is walking a tricky tightrope with its big bet on the next frontier in human interaction, and the future of the company could be at stake

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    GettyImages 673231372

    • A major flaw in the Conservative party conference app lets users log in without passwords to the accounts of hundreds of Conservative MPs, journalists and other attendees.
    • Users were able to login into the accounts, view private contact details, amend them and make them public.
    • The loophole was closed over an hour after it was first spotted on social media. 
    • The Labour party: "How can we trust this Tory Government with our country's security when they can't even build a conference app that keeps the data of their members, MPs and others attending safe and secure?"
    • A Conservative party spokesperson apologised for the security issue. 
    • The Information Commissioner’s Office, which is responsible for data protection, confirms it will be getting in touch with the Conservative party to discuss the security mess-up.

    LONDON — A major design flaw in the Conservative party's conference app for mobile phones has given users access to the contact details of hundreds of government ministers, MPs and prominent journalists.

    Theresa May's Conservatives are set to gather in Birmingham, England tomorrow for its annual autumn conference, with the party's most senior figures set to attend the four-day event.

    However, it emerged on Saturday that the mobile phone app created for conference goers had a major security flaw that allowed users to look at the contact details of attendees, including those of very senior politicians, without a password.

    The loophole, now rectified, allowed anyone who downloaded the app to log in to the personal profiles of politicians including former Foreign Secretary, Boris Johnson, and current serving ministers including Chancellor Philip Hammond, the Environment Secretary Michael Gove and the Home Secretary Sajid Javid.

    Twitter users reported being able to change the personal details of senior politicians. The contact details of Conservative MPs, party members, and prominent journalists could also be seen. Images of the politicians were replaced with pictures of hardcore pornography with private phone numbers were made widely available.

    Reports also suggest that at least two cabinet ministers received prank calls.

    A Conservative party spokesperson said: "The technical issue has been resolved and the app is now functioning securely. We are investigating the issue further and apologise for any concern caused."

    The Information Commissioner's Office, the independent body which deals with data protection, has confirmed it intends to contact the Conservative party about the security mess-up. 

    "We are aware of an incident involving a Conservative Party conference app and we will be making enquiries with the Conservative Party," an ICO spokesperson said.

    "Organisations have a legal duty to keep personal data safe and secure. Under the GDPR they must notify the ICO within 72 hours of becoming aware of a personal data breach, if it could pose a risk to people's rights and freedoms."

    Boris Johnson

    The Labour party accused the Tories of failing to protect the safety of conference attendees.

    Jon Trickett MP, Labour’s Shadow Minister for the Cabinet Office, said: "How can we trust this Tory Government with our country's security when they can't even build a conference app that keeps the data of their members, MPs and others attending safe and secure?

    "The Conservative Party should roll out some basic computer security training to get their house in order."

    BuzzFeed's senior political correspondent Alex Wickham tweeted that the Conservative party's data protection officer, Andrew Stedman, said the party's headquarters would "contact all those affected and submit a data breach report to the Information Commissioner's Office this weekend."

    Conservative party conference app

    Guardian columnist Dawn Foster, was one of the first people to notice to design flaw. She tweeted: "FFS, the Tory conference app allows you to login as other people and view their contact details just with their email address, no emailed security links, and post comments as them.”

    "They've essentially made every journalist, politician and attendee's mobile number public. Fantastic."

    SEE ALSO: Boris Johnson's 6 point plan has no real answers to fixing Brexit

    Join the conversation about this story »

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    Anderson Cooper Rachel Maddow Sean Hannity

    Anderson Cooper of CNN, Rachel Maddow of MSNBC, and Sean Hannity of Fox News are three of the biggest primetime anchors in media today.

    Each anchor and their respective cable news network takes a unique and different angle on the news of the day during primetime programming. As a result, their audiences can come away with different perspectives on what's happening in the US today.

    Because of the role and platform that each host has, all three are able to shape and influence what viewers believe is the most important news in the world.

    For a week, we watched all of their shows to compare what news each led their program off with. Here's how the three primetime cable news anchors opened up their shows every night from September 10-14.

    SEE ALSO: Newspaper front pages from where Trump held his rally one night perfectly illustrate how Americans see the news differently

    DON'T MISS: 11 iconic newspaper front pages from world-famous events

    Monday, September 10: Anderson Cooper, CNN

    Cooper, who frequently opens his 8 p.m. ET show with his "Keeping Them Honest" segment, led off his show discussing the White House's response to the anonymous op-ed in the New York Times and its search to find out who wrote it.

    He also talked about Bob Woodward's new book, "Fear: Trump in the White House", and how President Donald Trump and his administration were responding to the book.

    Monday, September 10: Rachel Maddow, MSNBC

    Maddow, who comes on the air on MSNBC at 9 p.m. ET, opened up her show discussing the developments on Hurricane Florence. She was the first of the three anchors sampled to discuss the hurricane at the top of her show, and the only one to discuss the storm at the top of the show all five nights that week.

    She also talked about: the Republican attempt to set up a confirmation vote for Supreme Court nominee Brett Kavanaugh later in the week, the Democrats' attempts to delay the vote, the court proceedings surrounding Russian agent Maria Butina, the White House's response to Woodward's forthcoming book, former Trump campaign foreign policy adviser George Papadopoulos being sentenced to prison for 14 days, and Trump's expected declassification of Justice Department surveillance documents.

    Monday, September 10: Sean Hannity, Fox News

    Hannity, who comes on at 9 p.m. ET on Fox News, led off his show with his well-known "Opening Monologue" discussing the Democrats' desire to impeach Trump if they win back the House of Representatives in the midterm elections this fall.

    He also addressed policies Democratic candidates would support if elected to Congress, the impact the midterm elections could have on the Trump agenda, and the alleged bias and corruption of the "deep state" in the Justice Department and FBI toward Trump.

    See the rest of the story at Business Insider

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