Incendiary accusations of collusion between Silicon Valley giants have been at heart of US business culture. Andrew Orlowski takes a look at whether Big Tech firms have become free market champions or a cosy cartel. Read his feature here
The most damaging of the accusations to land on the tech giants is incendiary. It’s the accusation that they do rather more than peacefully co-exist – that today, they step aside to assure each other’s interests. They have been caught once before, being fined $325m in 2011 for conducting a wage-fixing cartel that kept Valley engineers’ salaries low. But these new allegations involve entire markets.
Freetrade crowdfunding backers become millionaires
At least six early backers of British stock trading app Freetrade have seen their stakes in the company rise to be worth at least £1m after its valuation rose to more than £265m.
The London financial technology business launched a £100,000 crowdfunding campaign in 2016 months after it was founded.
Investors who backed the business with at least £18,000 at the time are now sitting on stakes worth more than £1m, Sifted reports.
One early crowdfunding investor in Freetrade who continued to put more money into the business as it grew now has a stake worth £8.4m.
Freetrade has been one of the main British beneficiaries of the recent surge in demand from retail investors who pushed the share prices of Gamestop and other “meme stocks” up earlier this year.
Adam Dodds’, Freetrade’s chief executive, told The Telegraph in January that the business saw the number of new customers multiply 10 times in a single day.
However, retail investors eager to purchase Gamestop shares later turned their back on Freetrade after the business was forced by its currency exchange provider Barclays to block purchases of US shares at the end of January.
“We received no warning of what we consider an extremely poor decision,” Mr Dodds said at the time.
Many fledgling start-ups including Freetrade turn to crowdfunding services as a way to top up institutional funding rounds. Other financial technology businesses including Monzo and Revolut have carried out similar campaigns.
However, the risky nature of start-ups means that crowdfunding backers can stand to lose their entire investments.
Backers of London start-up Sugru, a moldable glue product beloved by technology investors, lost up to 90pc of their investments when the company was sold in 2018.
SoftBank’s latest technology investment is in Norwegian robotics business AutoStore, which uses robots to transform warehouses into ultra-efficient storage facilities that don’t require costly humans to operate.
The Japanese technology conglomerate spent $2.8bn (£2bn) to acquire a 40pc stake in the company, which uses powered robots and a network of cubes that store items in so-called “bins” for easy retrieval.
The deal values the business at $7.7bn, it has been reported.
The start-up had been owned by private equity business Thomas H. Lee Partners while investment fund EQT also retained a stake.
SoftBank has for years been interested in robotics as a key field for its investments. In 2017, it acquired robotics business Boston Dynamics from Google’s parent company but has since sold a controlling stake in the company to Hyundai.