TheChek News Flow

Over the weekend, a clip from a recent interview with Telegram’s founder Pavel Durov went semi-viral on X (previously Twitter). In the video, Durov tells right-wing personality Tucker Carlson that he is the only product manager at the company, and that he only employs “about 30 engineers.”

Security experts say that while Durov was bragging about his Dubai-based company being “super efficient,” what he said was actually a red flag for users.

“Without end-to-end encryption, huge numbers of vulnerable targets, and servers located in the UAE? Seems like that would be a security nightmare,” Matthew Green, a cryptography expert at Johns Hopkins University, told TechCrunch.

Green was referring to the fact that — by default — chats on Telegram are not end-to-end encrypted like they are on Signal or WhatsApp. A Telegram user has to start a “Secret Chat” to switch on end-to-end encryption, making the messages unreadable to Telegram or anyone other than the intended recipient. Also, over the years, many people have cast doubt over the quality of Telegram’s encryption, given that the company uses its own proprietary encryption algorithm, created by Durov’s brother, as he said in an extended version of the Carlson interview.

Eva Galperin, the director of cybersecurity at the Electronic Frontier Foundation and a longtime expert in the security of at-risk users, said that it’s important to remember that Telegram, unlike Signal, is a lot more than just a messaging app.

“What makes Telegram different (and much worse!) is that Telegram is not just a messaging app, it is also a social media platform. As a social media platform, it is sitting on an enormous amount of user data. Indeed, it is sitting on the contents of all communications that are not one-on-one messages that have been specifically [end-to-end] encrypted,” Galperin told TechCrunch. “‘Thirty engineers’ means that there is no one to fight legal requests, there is no infrastructure for dealing with abuse and content moderation issues.”

“And I would even argue that the quality of those 30 engineers isn’t that great,” Galperin continued. “Also, if I was a threat actor, I would definitely consider this to be encouraging news. Every attacker loves a profoundly understaffed and overworked opponent.”

In other words, it’s unlikely for Telegram to be very effective fighting hackers, especially government-backed ones, with such a small staff.

Telegram did not respond to a request for comment, which included questions on whether the company has a chief security officer, and how many of its engineers work full time on securing the platform.

Last week, the well-known cybersecurity expert SwiftOnSecurity wrote on X that “The cost to run a company that has all the right cyber security tools and staff is absolutely obscene.”

“It’s hard to describe the numbers I’ve seen. Even saying this is a gray area. But it is [an] incredible headcount and spend,” SwiftOnSecurity wrote.

All to say, even the biggest companies on the planet probably don’t spend enough money, time and energy on securing themselves. Telegram has almost one billion users, according to Durov. It’s one of the most popular platforms for people working in crypto (who move millions of dollars), extremists, hackers and disinformation peddlers.

That makes it an incredibly interesting target for both criminal and government hackers. And it has — at most — just a handful of people dedicated to cybersecurity.

For years, security experts have warned that people should not see Telegram like a truly secure messaging app. Given what Durov said recently, it may be even worse than experts thought.

The Alto by San Carlo rooftop restaurant and terrace will be transformed into an immersive space called Le Club Lacoste.

YELLOW TURNS GREEN: This summer Lacoste‘s green hue is taking over Selfridges.

The French luxury sports brand will place itself on the second floor atrium and transform the Alto by San Carlo rooftop restaurant and terrace into an immersive space called Le Club Lacoste.

“We have decided to associate our iconic brand with the power of Selfridges, repeatedly recognized as the best department store in the world. We share a strong affinity for creativity and innovation,” said Catherine Spindler, deputy chief executive officer of Lacoste.

“This year, associating Lacoste with the summer of sport theme is a natural fit and perfectly aligns with our brand’s codes. It is also, and above all, a beautiful setting to showcase our collection from our latest fall 2024 fashion show,” she added.

At the end of last year the department store partnered with the French brand on a pop-up to celebrate Lacoste’s 90th anniversary.

It’s a special moment for Lacoste, as the collection on the shop floor will be from creative director Pelagia Kolotouros’ debut.

Upstairs on the terrace, a special drinks menu for the restaurant has been designed, taking its inspiration from tennis with cocktails taking on names such as Rene, Cucumber Deuce and Match Point Spritz.

Digital screens have been installed on the terrace for visitors to catch live tennis games from the 2024 Wimbledon Championships, which started Monday and will end on July 14.

Lacoste has decorated the space with archival images from the brand’s tennis past, from founder René Lacoste’s tennis career to the first Lacoste polo.

Stripes was founded by Watts in collaboration with Amyris in 2022. When the latter filed for Chapter 11 bankruptcy, Stripes headed for the auction block and was sold for $500,000 to Sakana LLC in December with the “Mulholland Drive” and “King Kong” actress listed as managing member.

“This is an exciting moment for Stripes Beauty, and I’m grateful to L Catterton for believing in our brand and sharing our vision of supporting women in menopause,” said Watts. “Stripes Beauty’s mission, products and community are deeply meaningful to me, and I’m thrilled to partner with L Catterton, [which] is also dedicated to providing solutions to this underserved community.”

“As consumer-focused investors, we have followed the success of Stripes Beauty and believe in their mission to develop a community of support for women as they age,” added Whitney Casey, who led the deal for L Catterton. “We are proud to invest in women and contribute to developing a health platform to address the full range of women’s unique lifestyle needs. Led by a team of strong industry experts, we will nurture and grow the Stripes Beauty brand, its community and consumer loyalty.”

Under this new partnership with Watts, of which financial terms were not disclosed, L Catterton has tapped Debra Perelman, the former Revlon CEO, as executive chair, while Cara Kamenev, a former L’Oréal executive, has been named president.

Stripes Beauty will also expand into sleep support with The Dream Date, a clinically backed supplement featuring melatonin, magnesium and red clover. Additionally, along with scaling on its own website and on Amazon, the brand will launch at QVC and in Canada later this year.

Currently, Stripes is available on Amazon, sephora.com and direct-to-consumer. Products include Vag of Honor Intimate Hydrating Gel, Oh My Glide Intimate Play Oil, and Dew As I Do Ectoine + Vit C Brightening & Hydrating Cream.

L Catterton has invested in the likes of Tula, Oddity, The Honest Company and Nutrafol, and has been particularly active in the beauty space as of late. In April, it acquired a majority stake in Italian cosmetics brand Kiko Milano. The private equity firm also launched Elevate Beauty, a fund developed within L Catterton’s Growth Fund dedicated to investing in early-stage beauty businesses. Three recent L Catterton investments — cosmetics brand Dibs Beauty; plastic surgeon founded skin care line Eighth Day, and Irene Forte Skincare, a natural skin care label — will sit within Elevate Beauty.

OpenAI is on an M&A tear.

Days after acquiring database tech firm Rockset, OpenAI has purchased Multi (previously Remotion), a startup developing an enterprise-focused, video-first collaboration platform. A source familiar with the matter says that the deal is technically an acqui-hire and that most of Multi’s team — around five people — will join OpenAI following the deal’s close.

Alexander Embiricos, Multi’s CEO and one of its co-founders, says that Multi will shut down after July 24.

“We’re beyond excited to share that Multi is joining OpenAI,” he wrote in a post on Multi’s blog. “Thank you to everybody who used Multi. It was a privilege building with you, and we learned a ton from you.”

With Multi, Embiricos (an ex-Dropbox product manager) and Multi’s second co-founder, Charley Ho (an ex-Google software engineer), set out to build a Zoom-based platform designed for remote teams to work together through video chats. Multi offered features like the ability to collaborate across screen shares from up to 10 people at the same time, customizable shortcuts and automatic deep links for code, designs and documents.

According to Crunchbase data, Multi raised $13 million in cash from VCs including Greylock and First Round Capital prior to Monday’s exit.

As with the Rockset buy, the Multi deal seems to fit into OpenAI’s broader recent strategy of investing heavily in enterprise solutions. OpenAI recently revealed that the corporate tier of its viral AI-powered chatbot platform, ChatGPT, had close to 600,000 users, including 93% of all Fortune 500 firms.

In May, OpenAI signed an agreement with PwC to resell OpenAI’s tools to other businesses. The month before, the company launched a business-oriented custom AI model tuning and consulting program.

The enterprise buys appear to be paying dividends, with OpenAI’s revenue set to eclipse $3.4 billion this year, per The Information.

Along the same vein as OpenAI’s other corporate-aimed product efforts, could we one day see a spruced-up ChatGPT with videoconferencing and remote collaboration capabilities? Maybe. I wouldn’t put it past OpenAI — particularly as the lag time between the org’s flagship models lengthens.

Industry says using the technology at higher speeds is impractical and too costly; regulators say the move would reduce accidents

A trade group representing carmakers is pushing back on a rule that requires automated emergency-braking systems in future vehicles, arguing the requirements are nearly impossible to meet and would be too costly.

The Alliance for Automotive Innovation, which represents the largest automakers, on Monday petitioned the auto industry’s top safety regulator to reconsider certain parts of the final rule, but it didn’t object to an overall requirement that new vehicles come equipped with the automatic-braking feature.

The move by automakers marks the latest clash between the industry and safety regulators, who have tried to impose stricter standards and take advantage of new technologies to reduce traffic deaths after a rise in recent years.

Automatic-braking systems use sensors, cameras and software to detect potential crashes with other vehicles and pedestrians, automatically applying the brakes if the driver fails to do so.

Carmakers voluntarily agreed in 2016 to increase offerings of the braking systems by 2025, but government officials have pushed for higher standards for the technology given inconsistencies between different systems. About 90% of new light vehicles made in 2022 were built with the technology, according to regulators.

The National Highway Traffic Safety Administration completed the rule in late April, requiring all vehicles sold in 2029 to come with the auto-braking technology. It mandates certain standards for the systems, such as being able to stop and avoid contact with another vehicle traveling at as much as 62 miles an hour and being able to detect pedestrians in darkness.

The new regulations also would require cars be able to apply the brakes automatically at as much as 90 mph when a vehicle collision is imminent, and at as much as 45 mph before a possible collision with a pedestrian.

NHTSA has said the requirement would slash rear-end accidents and pedestrian crashes, saving at least 360 lives a year and preventing at least 24,000 injuries.

John Bozzella, president of the Alliance for Automotive Innovation, said in a letter to Congress on Monday that the rule would require systems to work at higher speeds than are practical with current technology. He also said NHTSA’s requirements would cause vehicles to apply brakes well before what other drivers expect, leading to more rear-end collisions.

NHTSA didn’t immediately respond to a request for comment.

Bozzella added that regulators had underestimated the costly changes needed to comply with the new rule, which would lead to higher car prices for consumers.

“Yes, this rule will make vehicles more expensive, but the real issue isn’t cost—it’s cost/benefit,” he said. NHTSA’s rule, he added, “will require more costly systems that won’t improve driver or pedestrian safety.”

The technology has caused issues for some consumers in the past. Regulators in recent years have investigated incidents in which the technology activates for no apparent reason, at times leading to crashes.

Regulators have pushed for increased use of automatic braking as they crack down on full self-driving technologies. NHTSA is investigating Tesla’s automatic-driving features, which were linked to a spate of injuries and fatalities.

The European plane maker said that it will book charges of about €900 million in the first half of 2024

Airbus AIR 0.13%increase; green up pointing triangle said it won’t be meeting its annual targets for the year, including the number of commercial aircraft it planned to deliver, after its space-systems management team identified further commercial and technical challenges.

The European plane maker on Monday said that it will also book charges of about €900 million ($962.5 million) in the first half of 2024 following an extensive review of its space-systems programs.

Airbus expects to end the year delivering 770 commercial aircraft, down from a prior outlook of 800 commercial aircraft deliveries a couple of months ago.

The company said its A320 ramp-up trajectory has been adjusted to reflect specific supply-chain challenges in a degraded operating environment, and that its target production rate of 75 A320 Family aircraft a month is now set to be reached a year later, in 2027.

Airbus also forecasts adjusted earnings before interest and taxes of about €5.5 billion, below the €6.5 billion to €7 billion expected previously.

Airbus’s free cash flow before customer financing expectations have also been lowered to €3.5 billion from €4 billion, the company said.

The first-half expenses are mainly related to updated assumptions on schedules, workload, sourcing, risks and costs over the lifetime of certain telecommunications, navigation and observation programs, Airbus said.

Airbus’ first-half results are set to be published on July 30.

Novo Nordisk invests $4bn to expand weight loss drug production in US

Danish pharma group plans 1.4mn sq ft manufacturing plant in North Carolina to help meet surging demand

Novo Nordisk is investing $4.1bn to expand its US manufacturing and boost production of its blockbuster weight-loss drugs to meet surging demand.

The Danish pharma group said on Monday that the investment will fund a new 1.4mn sq ft manufacturing plant on a site near Raleigh, North Carolina, doubling its size. The extra capacity will come online between 2027 and 2029.

The investment comes as Novo Nordisk competes with rival Eli Lilly for a larger share of the market for a new class of diabetes and weight loss drugs, known as GLP-1s, which is already set to generate $42bn in sales this year and is projected to reach as much as $130bn by 2030.

Both Novo Nordisk’s Wegovy weight loss drug and its Ozempic diabetes treatment, as well as Eli Lilly’s rival Zepbound and Mounjaro medicines have been hit by shortages in recent months, according to the US Food and Drug Administration.

Both companies have spent billions of dollars to increase production of their drugs, which are self administered with an injection pen. Novo Nordisk this year agreed to pay $11bn for three “fill and finish” sites owned by Catalent, as part of a deal between the US contract drug manufacturer and Novo Nordisk’s parent company Novo Holdings.

As part of the “fill and finish” process, drugs are formulated before being filtered into syringes.

Including the latest investment, Novo Nordisk has committed $6.8bn this year to boost its own in-house production capacity. Last year, it announced plans to spend $6.5bn on a new Danish manufacturing site to increase production of semaglutide, the active ingredient used in its weight loss drugs.

Eli Lilly last month announced plans to spend $5.3bn on a manufacturing site to make tirzepatide, the compound behind its weight loss drugs, in its home state of Indiana. Since 2020, Eli Lilly has spent $18bn on building manufacturing operations across five sites in the US and Europe.

Lars Fruergaard Jørgensen, Novo Nordisk’s chief executive, said the investment was “yet another real signal of our efforts to scale up our production to meet the growing global need for our life-changing medicines”. The North Carolina facility will also help produce drugs targeting other chronic diseases.

Novo Nordisk has enough “fill and finish” capacity to manufacture roughly 850mn of the injectable pens for all of its diabetes and weight loss drugs this year, according to industry estimates seen by the Financial Times.

Booming demand for weight loss drugs has made Novo Nordisk Europe’s most valuable company, with a market capitalisation of $636bn as of Monday afternoon.

The new manufacturing site, located in the North Carolina town of Clayton, will create 1,000 new jobs in addition to the 2,500 people who already work for the group in the area. Novo Nordisk has had a presence in Clayton since 1993.

Man accused of directing savers to UK ‘Ponzi scheme’ hit by asset freezing order

Paul Careless alleged to have received £12mn from collapsed ‘minibond’ provider London Capital & Finance

An ex-police officer who is accused of netting about £12mn by directing members of the public in the UK to an alleged “Ponzi scheme” is to be hit by a freezing order on his property.

A High Court judge on Monday said he would impose asset restrictions on Paul Careless, who is accused of being a main beneficiary of one of the UK’s biggest retail savings scandals in recent years.

Careless is among a group of individuals being sued by administrators to the failed financial services firm London Capital & Finance. Almost 12,000 individual investors were promised high returns through “minibonds” offered by LCF, but lost a total of £237mn when it collapsed in 2019.

Victims had been directed to LCF by Surge Financial, an online marketing company established by Careless that received commissions of 25 per cent for each referral. The claimants have alleged Careless himself netted about £11.9mn.

Administrators have described LCF as “a Ponzi scheme”, and said that while the firm purported to use the funds raised to provide much-needed finance to small and medium-sized enterprises, those it had lent to were not independent but were connected with people behind the firm.

Careless has previously denied the claims against him, and said he had no knowledge of impropriety.

The judge, Mr Justice Miles, is yet to rule on the merits of the underlying case, which concluded this month. But he said on Monday that he would grant a request made by the administrators to restrict how Careless can use proceeds from the sale of his property in the Cotswolds, estimated to be worth about £2.25mn.

Administrators called on the judge to order that the cash be frozen and not used to cover the former police officer’s legal expenses, which the court heard had reached about £2mn.

Stephen Robins KC, for the administrators, told the court that there was “obviously a risk of serious, and possibly irremediable, prejudice” to the administrators “if, at the close of a long fraud trial, [Careless] is permitted to dissipate the proceeds of sale of his largest identifiable asset”.

The judge said he recognised that the order could be “tough” on Careless’s solicitors, who had “agreed to act on credit, and now find themselves in the unfortunate position of not being able to be paid”.

The claimants’ application for a freezing order was granted in principle, although court officials said the final wording was yet to be finalised.

The judge added there was “very substantial evidence” about the “very large amounts of money” received by Careless, and it was unclear what had happened to it.

A ruling in the case is expected in coming months.