Equity Monday: Meta and data, chips and dips, and crypto and meltdowns

Today, we are talking about Meta’s latest fines, what’s new in chips, and a few startup rounds that caught our eye! Stocks aren’t moving too much this morning, which could change if the American government voluntarily defaults over some bullshit. Crypto hasn’t moved too much lately, though we are keeping tabs on overall trading volume. Meta was hit with a record fine over how it handled EU user data. Data residency is a big deal and will likely crop up in future conversations concerning generative AI models and where they source their own data and from whom. China has banned some Micron products, irking the United States. The two economic powerhouses are working to distance themselves from one another in key technology areas. Elsewhere in chip-land, Applied Materials is investing in the United States and there are labor concerns regarding the sheer number of chips projects kicking off here at home. Patient21 raised a massive round for its software-and-services healthcare business, while Infinite Uptime raised more money for its “predictive maintenance solutions for machinery.” Whew! And that’s just the start! See you back here Wednesday for more! For episode transcripts and more, head to Equity’s Simplecast website. Equity drops at 7 a.m. PT every Monday, Wednesday and Friday, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts. TechCrunch also has a great show on crypto, a show that interviews founders, one that details how our stories come together and more! Credits: Equity is produced by Theresa Loconsolo with editing by Kell. Bryce Durbin is our Illustrator. We'd also like to thank the audience development team and Henry Pickavet, who manages TechCrunch audio products. Learn more about your ad choices. Visit megaphone.fm/adchoices

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  Hello and welcome back to Equity, the TechCrunch podcast where we unpack the numbers and the nuance behind the headlines. It is May 22, 2023, and this is our Monday show where we unpack the weekend and look ahead to the week to come. What's on the show today? Well, stocks and crypto, all things meta and data, chips, and then a couple of really cool startups. Let's go. All right, let's take a look at the markets and we'll start with stocks. Over in Asia, shares are mostly higher today. They're down across Europe, but not that much. And American stocks are largely flat in pre-market trading this morning. Now, the macro perspective that you need to know here is that the American government is currently locked in an argument concerning whether to pay its bills or not, with one political party refusing to cover its

• 0:57Speaker 00

  own tab unless the other makes cuts to its own priorities. No, this is not good for financial markets. And yes, America looks incredibly dumb for doing this very dumb thing again and again, and this time again. Flipping the page from the stock market to crypto, what's going on? Well, prices are just about where we left them last week. So if you are a crypto head, I hope you appreciate Bitcoin at around $27,000 or ETH at around $1,800. I am still surprised at the lack of volatility or real price movement in a market that has historically been very exciting. Now, there are a lot of meme coins popping off and no, I'm not going to share what they are called to avoid being accused of shilling or whatever, but it's silly season yet again,

• 1:39Speaker 00

  again, in crypto land when it comes to the invention of new and joke currencies. Volume overall is low, however, with the block reporting late last week that the quote seven day moving average for crypto exchange volumes has hit its lowest level since the beginning of the year. Now, you may say to yourself, the meme coins will save them, but they haven't so far. Overall crypto, the temperature is dropping.

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  Much like yourself, I have completely lost track of all the fines that Meta has paid to the EU over time. It feels like a never-ending list at this point. However, there's a new one this morning, so strap in. According to tech enthusiast Natasha Lomas, the European Data Protection Board, or EDPB, has announced that Meta has been fined 1.2 billion euros, which the board confirms is the largest fine ever issued under the bloc's General Data Protection Regulation, better known as GDPR. Actually, the prior record went to Amazon, which got hit by an $887 million fine back in 2021. Meta, you're now in first place. So what did the company do? Well, Meta's sanction is for breaching conditions set out in the Pan-EU regulation governing transfers of personal data to so-called third countries,

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  in this case, the US, without ensuring adequate protections for people's information. And what's funny here is that European judges have previously found that US surveillance practices actually conflict with EU privacy rights. So if you take EU data and bring it to the US and then we spy on it, the EU is mad. Anyways, what's next? Well, Facebook has been hit with a formal suspension order requiring it to stop exporting European Union user data to the US for processing. We'll see if they do that, or we'll see if there's another fine coming up in six months. Ironically, I was talking to a startup just last week about data residency and all the laws around it. As the world's data regulations become stiffer and more varied by country or bloc, it's only going to get harder to not make a mistake with data. Also, I really doubt that we are done with the arguments about

• 3:29Speaker 00

  the legality of data ingestion regarding the large language models that power what is called AI today. Recall that we've already seen some countries bristle at tools like ChatGPT and where they got their information. More simply, I think that regulation has mostly caught up to the social age of the internet, as evidenced by the latest Meta fine, which is progress of a sort, but also regulation has fallen far behind where tech itself has raised ahead to. So we're probably going to see new norms and regulatory action regarding AI and the data powering it in the years to come. I don't think the US will lead on the regulatory front, but perhaps the EU will guide us.

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  Whenever you see a dip in the modern market, there must be chips. Anyways, big news in chip land. According to TechCrunch's Rita Liao, China has banned some sales of Micron products after launching a probe into the American memory chip giant for cybersecurity risks in early April. Now, this decision is widely seen as part of the larger tit for tat in the ongoing US-China economic competition, which has started to upend a deeply intertwined global tech supply chain. And for more context, last year, the US added China state-backed memory chipmaker Yangtze Memory Technologies Corporation to the entity list, barring US companies from supplying it without approval. And the US has also restricted Nvidia from exporting its state-of-the-art GPU for generative AI training to China.

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  The US government is not taking this sitting down, or maybe they are, but they have a lot of words to say. They're claiming that China is not doing what it said regarding becoming more business-friendly and transparent, and that the US will, quote, "engage with key allies and partners to address distortions of the memory chip market caused by China's actions." We'll see how that plays out in the next couple of days. In other chip news, The Wall Street Journal reports that Applied Materials, which makes products used to create semiconductors themselves, plans to build a, quote, "massive research facility" near its hometown in Santa Clara, California, "to allow chipmakers and universities to collaborate on advances to make more powerful chips." That's domestic chip production. We love to hear about it. And elsewhere, The Times reports that the recent CHIPS Act in the US is spurring dozens of projects in the country against concerns of a skilled labor shortage.

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  So if you are pivoting out of crypto, try semiconductors.

• 5:40Speaker 00

  Put away China, put away big tech, put away crypto. Let's talk about some startups. And the first one for you this morning is called Patient 21. It's a four-year-old German startup that combines a digital healthcare platform with real-world brick-and-mortar clinics, and the company just raised 100 million euro. Now, that's a series C round led by Israeli VC Fertin Patago, and it was made up of both equity and debt. Patient 21 was founded out of Berlin in 2019, and its platform spans pretty much the whole patient cycle from online bookings through digital case histories, check-ins, billings, insurance, and more. Very cool. I dig it. Notably, Patient 21 is actually not that telemedicine-focused in its current incarnation, but instead sends patients to more than 50 outpatient clinics across Germany.

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  Why build software and not do a lot of telemedicine? Well, the company is largely focused on dentistry today, which, well, you actually have to go in for. Our next company is called Infinite Up Time. It's an Indian industrial IOT startup that offers predictive maintenance solutions for machinery and it has secured an additional 18.85 million as part of an ongoing funding round led by Tiger Global. TechCrunch reports that the Series B three round also saw participation from other existing investors, including Mayfield, GSR Ventures, Venture East and THK. The investment will help the startup strengthen global market share and expand value delivery, it said, which I believe is corporate speak for doing stuff. Now, why do we care about Infinite Up Time? Well, the startup kind of fits into the larger

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  theme of India picking up some of China's electronics manufacturing as global companies look to diversify their supply chains away from China itself. Why not invest in the company that may service some of those new and planned plans and productivity? It just kind of makes sense.

• 7:24Speaker 00

  And that is our show for this fine Monday morning. I do hope you are well and that it is summer where you are and you are warm and happy and going to knock off early and barbecue. Equity is back on Wednesday and Friday, but if you want to stay up with us in the meantime, we are EquityPod on Twitter. I am Alex on Twitter. You look amazing today. We'll talk to you soon. Bye.

• 7:46Speaker 00

  Equity is hosted by myself, editor in chief of TechCrunch Plus, Alex Wilhelm, and TechCrunch senior reporter, Mary Ann Azvedo. We're produced by Teresa Locan Solo with editing by Kel. Bryce Durbin is our illustrator. And thanks to the TechCrunch Audience Development Team and Henry Pickard, who manages TechCrunch Audio Products. Thank you so much for listening and we'll talk to you next time.