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Illustration: Sarah Grillo/Axios

In a letter provided first to Axios, ACRONYM co-founder Tara McGowan sought to clear up donor questions about Shadow, the company that produced the app in the Iowa caucuses.

Why it matters: It's the first time ACRONYM has spoken out publicly on the incident since the caucus, which was marred by failures tied to the app.

  • "We have absolutely no interest in covering this up, which has been suggested," McGowan told Axios in a phone call on Wednesday evening.
  • "We just want to make people understand that we are a nonprofit that has invested in Shadow because we believe in [Shadow CEO Gerard Niemira], just as the Iowa Democratic Party did."

McGowan told Axios the Shadow team "made an enormous mistake that has dire consequences in this election and so we want to own that."

  • But she stands by Shadow's efforts to help push the Democratic Party to innovate.
  • "The space was ripe for disruption and innovation. Yet with the ethos of taking great risks means that we can make great mistakes."

What's new: In the letter, McGowan listed a timeline for ACRONYM's relationship with Shadow.

  • She said that ACRONYM "now owns a majority of the company, but there are other private investors too."
  • Niemira told Bloomberg that “the app was sound and good,” but the “problem was caused by a bug in the code that transmits results data into the state party’s data warehouse.”
  • “The bug wasn’t the only issue with the app,” Bloomberg reported. Caucus "chairs were having trouble signing in."

The big picture: News reports immediately following the caucuses identified Shadow as the company behind the app and ACRONYM as the nonprofit with a financial stake in Shadow.

  • In the letter, McGowan emphasized the difference between ACRONYM and PACRONYM, a political action committee.
  • ACRONYM is a nonprofit that both runs its own programming as well as invests in for-profit companies.
  • "We built our organization as a very innovative model in order to really push the envelope and build new things because the way campaigns and the party had operated in 2016 was not getting the job done."

The bottom line: McGowan says that she doesn't want this incident to slow investment in new tech and innovation.

  • "We don't want things like this to discourage people taking risk because the aversion to the risks could be the reason we lose in November."
  • "It would be a real travesty if an error of this nature told everyone to stop taking risks and doing things differently,” she said. “It’s why we do things differently. Shadow is one piece of the overall structure that we created, but a minor but critical one in this moment.”

Go deeper: Read McGowan's full letter

Go deeper

Off the Rails

Episode 4: Trump turns on Barr

Photo illustration: Eniola Odetunde/Axios. Photos: Drew Angerer, Pool/Getty Images

Beginning on election night 2020 and continuing through his final days in office, Donald Trump unraveled and dragged America with him, to the point that his followers sacked the U.S. Capitol with two weeks left in his term. Axios takes you inside the collapse of a president with a special series.

Episode 4: Trump torches what is arguably the most consequential relationship in his Cabinet.

Attorney General Bill Barr stood behind a chair in the private dining room next to the Oval Office, looming over Donald Trump. The president sat at the head of the table. It was Dec. 1, nearly a month after the election, and Barr had some sharp advice to get off his chest. The president's theories about a stolen election, Barr told Trump, were "bullshit."

In photos: Protests outside fortified capitols draw only small groups

Armed members of the far-right extremist group the Boogaloo Bois near the Michigan Capitol Building in Lansing on Jan. 17. About 20 protesters showed up, AP notes. Photo: Seth Herald/AFP via Getty Images

Small groups of protesters gathered outside fortified statehouses across the U.S. over the weekend ahead of President-elect Joe Biden's inauguration Wednesday.

The big picture: Some protests attracted armed members of far-right extremist groups but there were no reports of clashes, as had been feared. The National Guard and law enforcement outnumbered demonstrators, as security was heightened around the U.S. to avoid a repeat of the Jan. 6 U.S. Capitol riots, per AP.

Felix Salmon, author of Capital
8 hours ago - World

China's economy grows 6.5% in Q4 as country rebounds from coronavirus

A technician installs and checks service robots to be be used for food and medicine delivery in Jiaxing, Zhejiang Province, China, on Sunday. Photo: Hu Xuejun/VCG via Getty Images

China's economy grew at a 6.5% pace in the final quarter of 2020, the national statistics bureau announced Monday local time, topping off a year in which it grew in three of four quarters and by 2.3% in total.

Why it matters: No other major economy managed positive growth in 2020. Although the COVID-19 pandemic was first detected in China, the country got the virus under control and became one of the main positive drivers of the global economy even as the rest of the world was largely under lockdown.