Trump’s Tech Haves and Have-Nots

In tech, the story is going to be very much about the haves and have-nots over the next four years. Some tech firms will have juice with Donald Trump and some won’t. Trump’s Sunday night announcement that Brendan Carr will lead the Federal Communications Commission is more bad news for Meta Platforms, which increasingly looks to be one of the biggest tech losers in the Trump victory. 

Carr has been a vocal proponent of pushing back at big tech companies that limit conservative voices through content moderation, including by watering down the protections for tech firms provided by Section 230 of the Communications Decency Act. He made the case for this approach in a chapter of the Project 2025 conservative manifesto. As Carr notes in the Project 2025 chapter, a former FCC general counsel has argued that the agency has the power to interpret Section 230. 

So Carr could be in a powerful position to drive this strategy. And he has the support of Trump, who has also called for using the threat of weakening Section 230 protections as a stick to force companies to tone down content moderation. (Notably, Meta CEO Mark Zuckerberg in 2021 called for changing Section 230 by making its protections conditional on companies having systems in place to combat unlawful content.) 

If Meta is a have-not, Elon Musk’s Tesla and other companies in self-driving cars, such as Alphabet’s Waymo, are shaping up to be very big haves. Bloomberg reported today that Trump’s transition team has told people a “federal framework for self-driving” cars will be “one of the Transportation Department’s priorities.” That would be likely a big win for Tesla, which wants to introduce full–self-driving cars and robotaxis in the next couple of years, and for Waymo, which already has self-driving cars on the streets in a few cities, including San Francisco.

Right now there’s a patchwork of wildly varying state regulation for self-driving cars, while federal efforts to oversee the technology have stalled in recent years, according to a recent summary of regulation by law firm Baker Donelson. That means a federal framework would be a major step forward for the industry. Tesla stock rose 5.6% on Monday. 

One other possible Trump winner is Apple. In theory Trump’s plans to impose more tariffs on imports should hurt the iPhone maker, given that Apple’s hardware is made mostly in China. But another Bloomberg report today notes that CEO Tim Cook formed a good relationship with Trump last time, allowing Apple to dodge the impact of Trump’s first-term tariffs. The report even suggests Trump might drop the Biden administration’s antitrust lawsuit against Apple, filed this year. 

While the Biden administration seemed to treat all of tech the same, Trump will be more discriminating. We’re in for some interesting times.

ServiceTitan IPO May Not Be What Investors Are Looking For

ServiceTitan, which sells software for plumbers, landscapers and electricians, filed to go public on Monday. But this is one offering investors may avoid like a clogged toilet.

ServiceTitan isn’t exactly growing at breakneck pace—it expanded its top line 31% in the 12 months to January 2024, a rate that slowed to 24% in the first half of this year, its IPO filing on Monday revealed. 

That growth rate looks downright sluggish compared to the annual sales growth rates posted by software firms that have gone public in recent years. Data analytics firm Snowflake, which debuted in 2020, and marketing automation company Klaviyo—one of the only tech company listings last year—both reported annual revenue growth rates of 60% or more before going public.

Investors can forgive slow-growing companies if they make money. But ServiceTitan falls down on that criteria as well. The IPO filing today revealed that it lost $92 million on $363 million in revenue in the first six months of this year alone, following a loss of $195 million last year.

ServiceTitan’s filing mentions artificial intelligence more than 70 times, as though that might  convince investors to give it a valuation premium. But the AI features it’s touting, such as document reading assistants and customer service agents, aren’t anything groundbreaking. 

Focusing on such a niche market brings certain risks, not least of which is that ServiceTitan’s technology may not be unique enough to withstand a competitor replicating its offerings. That could throw a wrench in the thesis some of its early investors, such as Bessemer Venture Partners, have been citing about the value of software that focuses on a single industry vertical. Just look at construction tech firm Procore Technologies or restaurant software company Toast, both of which went public in 2021 and are still trading in the public markets at prices nearly identical to their IPO ones.