Axios Pro Rata
November 09, 2018
Top of the Morning
The U.S. Food and Drug Administration reportedly plans to roll out new restrictions next week on the sale of non-tobacco flavored e-cigarette pods, including a ban on such products within convenience stores.
- This is a spiky speed-bump for Juul, most recently valued at over $15 billion by investors like Fidelity, as its top-selling flavor would be banned at retailers like 7-Eleven.
- The FDA also plans to require online age verification, which Juul already does (although we don't know if the FDA thinks its system is adequate).
- Juul, which is often quite chatty, didn't return requests for comment.
- The most notable piece here is the timing. The FDA on September 12 gave e-cig companies 60 days to submit information and plans for combating underage use. Either all of those discussions finished up early, or the FDA made up its find before closing industry arguments.
• Scooter scoop: On Wednesday we noted how Ford agreed to buy scooter company Spin. Now we've learned from multiple sources that the deal came after Spin had a signed Series B term sheet in hand, for $20 million on a $65 million pre-money valuation, led by New York's Rosecliff Ventures.
• Location, location, location: The new rules that strengthen U.S. regulatory oversight of foreign investment includes an under-noticed clause related to real estate. Per a report from law firm Mayer Brown:
"In recent years, however, CFIUS has developed and begun to review transactions involving the acquisition of a U.S. business in close proximity to sensitive US government facilities. Under FIRRMA, CFIUS jurisdiction has been expanded to include any type of real estate transaction in which the property is located within or in close proximity to an air or maritime port, US military installation, or any other property of the US government determined to be related to national security."
• As an aside, I once tried to get a propane tank filled at a local hardware store, but learned the store couldn't do that sort of business because it was next door to a post office.
• Central bankers: The Fed left rates unchanged yesterday and was generally optimistic about the U.S. economy, but did highlight how business investment growth fell from 8.5% in Q2 to just 0.8% in Q3.
• Other bankers: Goldman Sachs is under pressure for new revelations that then-CEO Lloyd Blankfein met with the former Malaysian prime minister and two men accused of laundering/plundering the country's sovereign wealth fund. Blankfein had been referred to anonymously in earlier court documents.
- UBS is being sued civilly by the U.S. Justice Department for the way it sold residential mortgage-backed securities ahead of the financial crisis. The complaint puts the "catastrophic" losses at "many billions of dollars."
• Stocking stuffers: There are now venture capitalist trading cards. Be sure to give them to that special someone who you really just want to leave you alone.
🎧 Pro Rata podcast: I speak with incoming Congresswoman Jennifer Wexton, one of the dozens of Democrats who flipped a House seat on Tuesday night, about what what's next for economic and tech policy. Listen here.
🏈 Go Pats!
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