Good morning. Andrew here. A venture capitalist at Sequoia who made some offensive remarks about Zohran Mamdani, the Democratic candidate for New York City mayor, is facing a backlash from hundreds of Silicon Valley founders and employees. We dive into the controversy and what the impact could be on the giant venture firm. We also break down the new tariff rates that could go into effect on Aug. 1 — and the scramble by countries to avoid them. (Was this newsletter forwarded to you? Sign up here.)
A battle over a venture capitalist’s Mamdani postsZohran Mamdani, the Democratic candidate for New York City mayor, has drawn heated opposition from many business elites for his policy positions, including higher taxes on businesses and the wealthy. But comments by a leading figure at Sequoia, the venture capital giant, calling Mamdani an “Islamist” have drawn backlash — and put the institution at odds with some of the founders it has backed. TL;DR: Shaun Maguire, a partner at Sequoia and a prominent Silicon Valley conservative, referred on social media last week to the news that Mamdani had checked boxes in his application to Columbia in 2009 indicating his ethnicity as “Asian” and “Black or African American.” (His parents are of Indian origin and he was born in Uganda, and he told The Times that he had sought to represent his complex background, and had noted his Ugandan origins in the application.) Maguire wrote on X that the news showed that Mamdani “comes from a culture that lies about everything” and added, “It’s literally a virtue to lie if it advances his Islamist agenda.” Entrepreneurs and others have censured Maguire’s comments. An online petition went up over this weekend calling the investor’s posts “a deliberate, inflammatory attack that promotes dangerous anti-Muslim stereotypes and stokes division.” It had more than 700 signatories as of this morning. Among them were several founders of companies that have been backed by Sequoia. One, Hisham Al-Falih of Lean Technologies, told Bloomberg that Maguire’s post was “not only a sweeping and harmful generalization of Muslims, but part of a broader pattern of Islamophobic rhetoric that has no place in our industry.” Maguire isn’t staying quiet. After the petition went live, he posted a nearly 30-minute video in which he apologized for offending anyone and said that only a small fraction of Muslims were Islamist. But in an X post this morning, Maguire wrote to his critics, “Your Hate and Ignorance only fuels me.” (He also posted purported screenshots of fake names among the signatures, though DealBook couldn’t find them in the petition this morning.) Sequoia has been caught in the crossfire as the controversy threatens to shake up the firm’s relationships with some founders. The petition calls on Sequoia to denounce Maguire’s remarks, investigate his conduct over the past two years and disclose any punishments, and to set up a process for Sequoia-backed founders to report discrimination by the firm’s personnel. “Anything short of these measures signals tacit acceptance of anti-Muslim hate and racism,” the letter reads. A Sequoia representative declined to comment to DealBook.
Tesla’s stock drops as investors protest Elon Musk’s latest political push. Shares in Tesla, the electric vehicle maker, lost $68 billion in market value over concerns that Musk’s plan to start a political party could lead the Trump administration to punish the company. Several shareholders called on Tesla’s board to rein in the C.E.O. (It’s still not clear how serious he is about the endeavor, though the former Democratic presidential candidate Andrew Yang said that he had connected with Musk.) A regulator questions Robinhood’s effort to sell “tokens” tied to OpenAI and SpaceX. Lithuania’s central bank, the lead regulator in the E.U. for Robinhood, an American investing app, told CNBC that it had sought information from the company about its plan to give ordinary European investors access to privately held companies via crypto. (The tokens aren’t available in the U.S. because of securities laws there.) OpenAI has criticized Robinhood’s move. Meta is said to pay top dollar to poach a top Apple A.I. researcher. Meta, Instagram’s parent company, offered an eight-figure pay package to Ruoming Pang, who oversaw Apple’s efforts to develop artificial intelligence models, according to Bloomberg. The hiring of Pang is the latest effort by Meta to hire senior A.I. talent via big pay packages; it has also lured away researchers from OpenAI, Anthropic and Safe Superintelligence, among other companies. Tariff letters comethPresident Trump has fired off a new round of tariff threats, with many more promised. But global investors this morning appear to be taking it mostly in stride after a whipsawing ride in U.S. stock yesterday. Indexes in Europe and Asia are mostly higher today as hopes remain that trade negotiators will be able to reach agreements for lower taxes by a new Aug. 1 deadline (that Trump himself said was “not 100 percent firm”). The bullish view: The current timeline “strengthens the view that Trump will be flexible in the end,” Holger Schmieding, chief economist at Berenberg, wrote in a research note this morning. That said, the European Union is racing to reach a potential framework that locks in a 10 percent tariff rate while it and the Trump administration negotiate myriad trade differences, according to Bloomberg. Maros Sefcovic, the E.U.’s trade chief, has informed European officials that he doesn’t expect Brussels to get a warning letter but cautioned that talks were still fluid, Politico reports. But there are reasons for concern, too. Rates that Trump announced yesterday for 14 countries are in line with what he indicated in April. They will affect Japan and South Korea, which are major tech and auto exporters, and Cambodia and Thailand, big apparel producers.
The fear is that tariffs could still disrupt global trade. Shares in Adidas, Puma and Pandora, all of whose global supply chains run through these countries, fell in European trading this morning; Nike and Lululemon were down in premarket trading in the U.S. The Trump administration faces a tough task: cutting scores of deals. Karoline Leavitt, the White House press secretary, said the phone was ringing “off the hook from world leaders” anxious for agreements. But the clock is ticking. “Prolonged negotiations extend the uncertainty, which is likely holding back investment decisions in the U.S. and its trading partners,” Schmieding of Berenberg wrote. Which country could be next? India, which has been in extended talks with the administration, didn’t get a letter. Is that a promising sign? South Korea, a close ally that made a trade deal with the U.S. in Trump’s first term, is another to watch. Lee Jae Myung, its president, has been on the job for about a month and has the arduous task of advancing stalled negotiations. Trump is asking for big concessions. Yesterday’s letters underscored that the president wants more than lower trade barriers: He wants countries to move more manufacturing to the U.S. Such provocations spooked global investors in April, causing a major sell-off in stocks and U.S. government bonds that ultimately forced Trump to rethink his tough stance. With global markets calm, he’s at least not facing that pressure now.
Tariffs muddle the economics of Prime DayPrime Day started as a one-day event unique to Amazon. But the discount period, which kicks off today, has evolved into a four-day-long digital sales ordeal involving many companies. And this year, President Trump’s trade wars are shaping the discount shopping festival, with Walmart, Target and other retail giants adapting their pricing strategies in response to anxiety linked to tariffs, Danielle Kaye reports. Amazon and Walmart are competing for e-commerce dominance. Their annual discount periods overlap this year: They both start today, with Walmart’s set to last six days. It’s the latest test of Walmart’s rapid growth in e-commerce. In May, Walmart’s e-commerce segment recorded its first profitable quarter. “They want to be a competitor to Amazon, who admittedly has been the industry behemoth,” Steven Shemesh, a retail analyst at RBC Capital Markets, told DealBook. Tariffs are generating the discounts. Retail sales have been falling along with consumer sentiment, tied to fears of price increases due to tariffs. That means shoppers are searching for deals even more than usual — a dynamic that the retail sector is trying to leverage. Online sales from July 8 to 11 are expected to surge 28.4 percent compared with the same period last year, according to Adobe Analytics. “It’s the big hurrah before fall sets in and the tariff prices start kicking in,” Matt Pavich, the senior director of strategy and innovation at Revionics, a retail price-optimization company, told DealBook. Tariff-fueled costs are expected to start showing up on shelves soon. Offering extensive deals is one of many strategies retailers are employing to try to be “as amenable to customers as possible from a price standpoint,” Pavich said. Companies known for low prices, including Walmart, have already cautioned that tariffs would prompt them to raise prices. Big discount events ahead of time could help improve customers’ perception of prices. More retailers than usual are jumping on summer savings, industry analysts said. That includes Target, Dick’s Sporting Goods and Best Buy. Coresight Research found that looming tariffs were leading shoppers to make back-to-school purchases before August — another incentive for retailers to lean into discounts this summer. “The door was opened because of tariffs,” Deborah Weinswig, the C.E.O. of Coresight Research, told DealBook. “They can control this. If there’s something you can control to drive your sales, to drive your margin, they’re doing it now.” We hope you’ve enjoyed this newsletter, which is made possible through subscriber support. Subscribe to The New York Times.
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Correction: Yesterday’s newsletter misidentified J. Thelander Consulting. It is a compensation data and consulting firm, not a compensation data and recruiting firm. Thanks for reading! We’ll see you tomorrow. We’d like your feedback. Please email thoughts and suggestions to dealbook@nytimes.com.
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