Sunday , April 2 2023

Palantir has an estimated $ 20 billion and a bigger problem: he loses money


PALO ALTO, Calif.-Palantir Technologies Inc. it looks like a successful spyware machine Silicon Vallei. It collapses a lot of data to find insights. His analysts are credited with helping find Osama bin Laden. Its value is $ 20 billion, one of the highest private technology companies, and its founders are well-known investor Peter Thiel.

Behind this hot picture to start, Palantir is trying to achieve his reputation.

The company began to plan an initial public offer, but did not realize its annual profit in its 14-year history. It tries to win more corporate customers after many years of flaring attempts, although some potential customers believe that Palantir is unsure about the job and is persistent about his work for governments and intelligence agencies. Last year they missed the sales targets after they hoped to get a deal.

His engineers were used to the expense – the company sponsored lunches with a tasting of 13 dishes with lobster and sashimi in the seat – calling the extravagance of Palantir Entitlement Syndrome.

Palantir is trying to win more corporate customers after several years of trying to capture a big business.

Palantir is trying to win more corporate customers after several years of trying to capture a big business.


Andrev Test for The Vall Street Journal

Alec Karp, executive director of the company, added to an unconventional atmosphere. When he gets excited about some idea, say current and former employees, he hits his fists and pushes employees in a quick fire in a solar plexus.

All this leaves Palantir and Mr. Carpe, at the famous passage in the Silicon Valley. It ran as a skeptical startup even though it became a global company. Facing appeals from investors and employees to publicly announce, in order to make it easier to sell stocks, Mr. Karp must now build Palantier in more traditional business.

"We are an adolescent company," says Karp, 51 years old. "Rules for a child and rules for adults are different."

Loss Leaders

Palantir is one of the hosts of highly valued startups who spent more money losing than some in previous generations.

The first profitable calendar year *

The first profitable calendar year *

The first profitable calendar year

First profitable

calendar year*

Palantir is among the large number of "unicorns" -startups worth over a billion dollars – which lose money for years after the start. Uber Technologies Inc. and VeVork Cos. They burned over $ 8 billion and $ 2 billion, respectively, and are still losing money. This is in contrast to the earlier generation.


he became an annual profit after five years.

Some investors complain to Palantra executives about long-delayed IPO plans, people say they are familiar with their complaints. His main sponsor, Mr. Thiel, is diminishing his private ownership, far below the Palantiri value of $ 20 billion, which came from his latest financial cycle in 2015.

Palantir's largest shareholder, Peter Thiel, says he believes in the company.

Palantir's largest shareholder, Peter Thiel, says he believes in the company.


Stephanie Keith / Getti Images

Investors say that they are g. Karp and others in Palantura said the company will become profitable in 2019. Karp promised in the past years. He continues to send mixed messages about whether money making is important, often saying that his primary focus is to build the most important company in the world.

"The unintended consequence of the numbers we're likely to publish," he says, "is profitability."

Palantir interviewed investment banks about plans for public disclosure in the next year. Behind the scene, Mr. Carp is on some apology. A meeting this year with clients in Washington, D.C., promised to change the impression of employees in the company as overworked, cordial, and even worthless.

"We were young children who played in shorts and t-shirts," Karp said, according to the people present, "and we realized it was damaging our credibility."

Unicorns in the valley

Most highly-valued American startups *

In order to reduce costs, Palantir unloaded the office property and slowed down expensive engineers. He is investigating work permits, such as traveling to international business classes at the last minute, a shock to a company that once entertained a discussion in the whole company about whether to restore hand-made bacon to the breakfast menu – "Bacongate," the employees said. Palantir fired two employees who took off their underwear and suits, say people familiar with the episode.

Palantir seeks to make its analytics software more attractive to corporations and has won among companies, including

Credit Suisse Group



& Co.,

Fiat Chrisler Cars

NV, United Continental Holdings Inc. i

Airbus SE

Mr. Thiel, still the largest stockholder in Palantir, says he believes in the company. "You go underwater," says Mr. Thiel, "and the important thing is to get air at some point."

Crystal ball

Interviews with current and former employees, investors and clients give insight into how Palantir is trying to turn his business.

Called for the crystal ball in the Lord of the Rings series, Palantir began in 2004, recently graduated Stanford students and funded $ 30 million mainly from Mr. Til,


co-founder. The central intelligence agency of the Central Intelligence Agency later agreed.

It has increased approximately $ 2.5 billion in 12 circles for 11 years. Investors are former Hollywood agent Michael Ovitz, founder of Home Depot Inc. Ken Langone and Rupert Murdoch, executive president of Nevs Corp, the parent of The Vall Street Journal.

Last month at London's Palatine Office.

Last month at London's Palatine Office.


Andrev Test for The Vall Street Journal

Palanther's initial idea focused on selling fraud detection tools, similar to what PaiPal uses. Buyers would be government agencies that would require them to discover links through remote data sets, such as vehicle registration or location of terrorist camps. Palantir soon counted clients, including the US Special Forces, the Federal Bureau of Investigation and the International Intelligence Agency.

G. Karp joined the Executive Director for several months. Although he was no longer a trained developer, multilingual g. Karp, with the philosophy of Doctoral Doctoral Studies, enthusiastically delighted the launch of a global organization, which spent about 250 days a year. Sometimes in German he loudly speaks on the phone and nurtures the gossip she talks to one of his friends in Europe.

"We have a big deal in Germany," Karp says of those accounts. "Most of my Germans are used to business growth."

A self-employed socialist whose working uniform is sportswear and brilliant hats, he is a fitness nut who lives in a room on a Bavarian-style farm. Sometimes he squeezes clients in his chest to demonstrate the movement of Chinese martial arts to redirect forces. There are three Tai Chi swords in his office in New York, and one in Palo Alto.

From the beginning Palenti's work was astonishing – many employees had to apply for a security clearance. Employees received five-digit bonuses if they live near the company's offices.

The company has previously focused mainly on government business. Their software has been recognized by investors and its staff to help bin Laden's American hunting, interfering with wider terrorist networks and exaggerating hunting, including Bernard Madoff.

The final trade talk for years was considered verbatim. Mr. Carp would tell his employees, looking for Palantra's engineering roots: "We will not have sellers for sale."

G. Karp says: "If it's started or it's over with some vulgarity, I'm sure I said it."

"This is not a science," says Mr. Karp. "We are a colony of artists."


Andrev Test for The Vall Street Journal

As Palantir sought to expand from the government to the private industry, her business plan included a loss of money earlier in the hope that later she would get lucrative tasks. Jobs are labor intensive, with software written on the program tab and one-on-one lecturer.

Instead of sellers, Palantir sent so-called engineers who were pre-deployed to meet potential customers. Some engineers have responded to skeptical questions from business perspectives, suggesting companies simply include their data in Palantier's software and wait for the results to flow – a proposal that some have taken as aggressive and presumptive.

G. Karp says clients have always controlled their data.

Released contracts

The Palantiri corporation strategy reached its peak about three years ago, when the companies encompassed

JPMorgan Chase

& Co. i


has reduced its contracts to millions of dollars. JPMorgan refused to comment. Spokeswoman Hersheia said: "Our Palatian project was part of the learning path to building these skills to find out."

Karp characterizes these struggles as part of a creative process that now yields results.

"This is not science," he says. "We are a colony of artists. You can not go to Bascuiat or Monet and say," Well, that painting did not capture the time. ""

To better communicate with corporations, Palantir launched a new product, Foundry, two years ago, which relates to off-the-rack software that amalgamates and black data in the organization.

Unlike previous efforts, in which engineers would customize software client-by-client, Palantir designed the Foundry to be more generic and integrated into existing computer networks of customers. Software is usually used by dozens or hundreds of workers, and not just software engineers who need special training. Palantir says he can potentially allocate fewer teams to each client and make more profit.

All-Seeing Eie

Palantir's powerful new Foundri software follows millions of data for large companies.

The driver reports the broken part to the dilemma

The foundry software compares millions of warranty claims, cross-checks with specific models, driving conditions (weather conditions), driver profile, assembly lines.

The foundry identifies a specific line for assembly, representation or sharing. Chrisler starts the recall within a few days.

The foundry is using Credit Suisse to buy one client worldwide and detect potential money laundering, says Lara Varner, chief British co-ordinating officer. Merck uses it to manage fertility drug sales data in China and a better forecast of demand and inventory, which is a problem for which Merk early wrote his own data research team without success, says James Kugler, director of the Digital Development Office.

Fiat Chrisler uses a system for precise separation of parts. United says this year she began to use casting to demolish customer surveys about when, for example, the airplane's seat will not collapse and shoot information to the appropriate mechanic in which the airplane has free time on the ground and a gate agent that can calm the flyer.

"Our data problems are not a small number of big data problems; they are a collection of thousands and thousands of really small, but interconnected problems," says Marc Fontaine, Digital Transformation Officer at Palantir Airbus. The foundry of the foundry, he says, is "to continue building and reusing the facility we use."

Palantir lost his repulsiveness to sellers. She says she hired 35 of them this year.

Last year, the company ended up with $ 600 million of revenue and expects it to reach more than $ 750 million in 2018 and 201 billion dollars in 2019. Investors said she hopes to earn 70% of her corporate income in the near future, with about half in the present and around none in the early days.

Palantir still faces the problem of public perception. It has long provoked criticism for the work of the government, including law enforcement software, which extends the surveillance of suspects. He earned billions of US government contracts through the administration of both parties, but immigration and privacy lawyers have recently criticized their immigration and customs enforcement contracts, pointing out that the company is helping the separation of migrant families by the Trump administration.

Airbus is a Palantir customer. The BelugaKSL airline carrier at the Airbus factory this year.

Airbus is a Palantir customer. The BelugaKSL airline carrier at the Airbus factory this year.


Frederick Lanselot / Associated Press

At meetings this year, some employees prayed executives to end ICE contracts. G. Karp told them that Palantir was helping break the drug front, not in separate families, and not make business decisions to join the short-term policy.

"I can not conduct my business on the basis of the latest political thing," says investor Palantir, Mr. Langone, "or they would not have a job."

G. Karp says his family hinders Palantir's work and that Trump's era made it difficult to sell the plot.

"There are a lot of customers globally, and some on the domestic market who feel they do not want to be connected with a company that supplies the secret agencies of the world," he says. "We want a public perception that reflects who we are, and not everyone will like it."

Some investors say they are putting increasing pressure on Palantir, who has consistently pushed IPO plans, going public. "It's probably time to do something public," says Tim Sullivan, CEO of Palantir Investor, Oceanic Partners. In private markets, he says, "there is not much demand" for the campaign.

Scenes in London's Palatine Offices.

Scenes in London's Palatine Offices.


Andrev Test for The Vall Street Journal

Palantir reports on the annual staff meeting and this year the meeting was postponed. This upset the employees, whom Palantir paid in part to hard sell the stock related to the company's performance. Engineering chief Shiam Sankar later stood in front of the staff and warned that the competition was strengthened.

"Uruk-hai is coming!" He said, referring to the evil Lord of the Rings. Palantier offered an additional payout in equity to long-term employees and reduced the cost of such options per share.

G. Karp says new cost-cutting efforts, such as travel policy, are focused on avoiding waste.

Morgan Stanley

investment bankers told Palantir that if it comes to bringing the public closer to $ 36 billion to $ 41 billion, it must convince the market that there are years of growth in the future, people who are familiar with these talks say.

The joint venture Morgan Stenley, which owns Palantir, estimates the value of Palantir at less than $ 5 billion since June. Morgan Stanley refused to comment. Other funds increase value.

G. Karp says Palantir's attitude to the IPO is "completely schizophrenic." Two years ago he told Žurnal that the offer would enable the employees "liquidity at a good price". He now declares that there is no "constant opinion" on one.

To write Rob Copeland at [email protected] and Eliot Brovn at [email protected]

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