Sequoia Capital is writing off its $210 million investment in crypto exchange FTX • TechCrunch
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Tech reporting is many things, but it’s certainly not boring, as the chaos surrounding Twitter, crypto, and layoffs continues. We’re just hanging on for dear life trying to make sense of it all. We think we did a pretty decent job, and here’s a selection of what’s happened in the last 24 hours with technology. — Christine and Shark.
TechCrunch Top 3
- Another domino falls: It was probably already a failure, but Binance deciding not to buy FTX led to Sequoia Capital claiming its minority stake in FTX as nothing more than some unrealized gains, Connie reports. Investor letter and everything.
- In the meantime, onto our other favorite hot root: Elon Musk was right when he tweeted that the company would do “a lot of stupid things.” Darrell reports on one of the recent returns (because they seem to accumulate before we even have time to catch our breath) where all these accounts were promised the little blue badge in exchange for $8, but as you all know , when you make fake accounts, it means we can’t have nice things.
- More Twitter changes: Another group of Twitter top dogs decided to leave the nest. This time it is Chief Information Security Officer Lea Kissner, followed by Chief Compliance Officer Marianne Fogarty and Chief Privacy Officer Damien Kieran. The latter two have reportedly resigned today, according to Zack and Ingridwho banded together to chase the details.
Startups and VCs
Denver-based VC firm SpringTime Ventures is pivoting away from its original focus on its home state of Colorado, despite being the only local fund in two of the state’s 10 unicorn companies, Becca reports. It’s also now able to expand its team thanks to raising three times as much money for Fund II, giving SpringTime enough cash on hand for its partners to finally pay themselves “a real salary.”
New crypto startups emerged during Alliance DAO’s demo day on Wednesday amid the FTX implosion. The latest cohort, known as All9, for Alliance DAO, a web3 accelerator and builder community, presented their ideas on Wednesday during a demo day, exclusively covered by Jacquelyn.
And here’s a smattering of other things that caught our beady eyes today:
Use IRS Code Section 1202 to sell your multimillion-dollar startup tax-free
Image credit: Brian AJackson (opens in new window) / Getty Images
Founding teams typically choose a corporate structure like an LLC or S-Corp, but those hoping to close for $10 million or more should consider starting up as a Qualified Small Business (QSB) C-Corporation, advises tax attorney Vincent Aiello.
Pursuant to IRS Code Section 1202, founders who have held QSB stock for five years or longer will be exempt from paying capital gains taxes after a sale.
“It represents a significant tax savings for entrepreneurs and small business investors,” says Aiello. “However, the effect of the exclusion ultimately depends on when the stock was acquired, the trade or business carried on, and various other factors.”
Three more from the TC+ team:
TechCrunch+ is our membership program that helps entrepreneurs and start-up teams get ahead of the pack. You can register here. Use the code “DC” for 15% off an annual subscription!
Big Tech Inc.
Elon Musk wants Twitter workers in the office and wants them to fight spam. Those were some of the messages the new owner had for employees on social media, Ivan write. Oh, he also told them to be ready for “difficult times ahead,” which is always something you want to hear from your manager regarding the future of your job.
After the Binance deal fell through, FTX founder Sam Bankman-Fried has some new focuses: winding down trading at Alameda Research and winding down its fundraising capability, Manish reports.
We promise, no more FTX or Twitter below:
