Female Entrepreneurs Face Many Challenges. Don't Let This One Hold You Back

When it comes to the technical details of the pitch, they don’t miss a beat. But I’ve noticed many have difficulty articulating the sweeping, long-term vision for their companies.

I can relate because I struggled with the same thing when I was in their position. It’s a very common issue, especially with female founders. I’ve found women tend to be more realistic in their estimations, or they feel it’s too early to be talking about what long-term success looks like.

It took me years to get over those hang-ups and to speak fluently about the future of my business, but it’s such an important skill for talking with investors or trying to hire talented individuals.

I always try to coach women entrepreneurs on how to express their vision, so I want to share what that looks like.

In the early stages, you have to be able to articulate the long-term, high-level vision.

You can tell when an entrepreneur doesn’t quite understand the future of their company because there are gaps in the pitch deck.

The first few slides will be much too focused on what’s happening right now–on the tactical applications. That’s a problem because the beginning of the pitch deck should be three to five slides of the enormous market opportunity that you’re ready to revolutionize.

It should name three high-level things you’re going to do in order to achieve that massive goal and how you’re going to eventually change the world. After painting that picture, you can get down into the nitty-gritty and tell investors about the tactical execution.

At the seed stage, investors are really evaluating both your vision and you as a founder. They’re wondering if you’ll be able to attract talent, to handle the ups and downs of an early-stage company.

You want to sell them on the idea first, then show them you understand the realities of getting there.

Selling your vision becomes easier when you stop focusing on day-to-day goals.

As a young startup, you need funding and you need great team members who are inspired to work with you. The only way you get both of those things is by learning to convey your master plan in a clear and compelling manner.

A lot of founders make the mistake of talking about what they’re doing right now or what they’ll be doing next year. But what you’re really selling is where you’re going to be in five years.

I know it’s difficult to stop concentrating on the day-to-day aspects of your business. Still, whether you’re talking to investors or trying to inspire your team, you have to stop thinking about what’s happening today. You have to shift your mindset and start explaining what it will look like when you’re taking over the world.

It feels like such a leap from where you are now, to where you’re telling people you’ll be. And you’ll probably start to feel the imposter syndrome creep in as you rehearse your vision.

But here’s the thing: whatever that vision is, it’s not too big.

This is supposed to be your pie-in-the-sky, difficult to achieve statement of where you’re going. You’re not exaggerating or boasting, you’re simply telling people what’s going to happen if you execute on your plan.

When you realize that, you can reframe the conversation in your mind. It’s not that you’re being inauthentic, it’s your way of sharing the grand vision with people so they’ll be willing to help you achieve it.

Once you understand your vision, explaining it becomes second nature.

Obviously, as a female founder, you have to to be confident. But knowing and selling your vision requires another level of confidence.

I know entrepreneurs may not be comfortable with the idea of the grandiose vision. Trust me, I felt the same way five or six years ago. We had no brand name, no manufacturing partner, no product. And yet we had to articulate that vision of revolutionizing the lingerie industry and taking down Victoria’s Secret.

The only way to gain that extra level of confidence is through practice. Articulate your vision over and over again to friends, family, advisors, your own reflection in the mirror. Just make it a part of your story and get comfortable talking about it.

Over time it will become second nature, and you won’t hesitate when you tell someone which industry giant you’ll soon be toppling.

Data Sheet—Facebook Is Playing Catchup With ‘Portal’ Video Screen

Unannounced. It’s debut day for new Google hardware, but first the search giant is making headlines for other, less positive reasons. After quite the hullabaloo from its employees over AI, Google said on Monday it would withdraw its bid for a $10 billion cloud services contract for the military due to objectionable terms and potential conflicts with its AI ethics policy. Amazon is widely expected to win the deal for the project called the Joint Enterprise Defense Infrastructure cloud, or JEDI. Google also announced it was shuttering its failed social network, Google+, while disclosing for the first time a security flaw at the service that could have allowed outside developers to view private profile data from hundreds of thousands of Google+ users. The company said there was no evidence of misuse of the data.

Double dealing. Dealmakers at Microsoft have been busy of late. The company says it is investing an undisclosed amount in Southeast Asian ride hailing service Grab in return for Grab using its Azure cloud platform. Separately, Microsoft’s LinkedIn unit said it bought employee survey startup Glint for an undisclosed amount that some reports put at over $400 million.

One giant leap for mankind. After private companies have sent many unmanned rockets into space, Virgin Galactic owner Richard Branson says he’s ready to send people up “within weeks, not months.” The company has successfully conducted three manned test flights within the Earth’s atmosphere this year.

Reintegration. Is the Hollywood studio system coming back together after splintering into a million pieces? Streaming video king Netflix has spent billions financing original productions. Now it’s buying a vast studio complex in Albuquerque, New Mexico, where movies such as Sicario and The Avengers were shot. Sign the top talent, produce the shows in-house, distribute the shows…sounds familiar.

Ahead of the curve. Venture capitalist Kirsten Green announced a new $360 million fund at her Forerunner Ventures, about triple the size of her prior fund. Green, who has focused on consumer businesses like Warby Parker and Birchbox, says she’ll look for startups that embody values consumers favor. “The consumer is leading the charge, and if the consumer is anchored around values and things that matter, that’s good for business,” she tells Fast Company in an interview.

Melting monster. Video gamers and videographers should be happy with Monday’s announcements out of Intel regarding new, ninth-generation desktop CPUs. Leading the class may be the i9-9900K, with eight cores and a top speed of 5 GHz at a price just under $500. Intel’s stock price was unchanged on the day but the slumping stock of rival AMD dropped another 3%, with its loss over the past week hitting 16%.

How JUMP Designed a Global Electric Bike

On a busy street, a JUMP bike looks like a bright-red blur. It’s eye-catching, a red that’s both a color and an announcement. But to Nick Foley, head of product at the electric bike-share company, the vibrant color is not only meant to turn heads. It’s a key part of shifting the way that commuters think about bikes as an urban transportation tool.

Bikes have been part of the urban transportation system for over a century. But as traffic congestion in cities worsens, and as concerns rise about about air pollution from gas-burning cars, cities have increasingly looked for solutions to decreasing reliance on automobile transportation. A few years ago, bike-share systems emerged as a possible solution to encourage alternative modes of transportation in cities.

“Ideally, we’re pulling people into the JUMP system who are not professional cyclists or even regular bicycle commuters,” Foley says. “The appeal of what we’re trying to do is that we’re getting everybody on an electric bike as a commuting tool.”

The red paint is part of Foley’s design ethos. To get “everybody” on a bike, you must first attract the attention of commuters who might not have considered a bike otherwise. But the paint’s appearance doesn’t tell the whole story. The breezy candy-apple color belies the fact that the paint has also undergone multiple chemical formulations to make it as corrosion resistant as possible. The paint performs the sleight of hand of effective design: purposeful, yet imperceptible to the user.

JUMP’s most pressing challenge, though, starts when the rider gets on. Each JUMP bike needs to accommodate a wide range of riders, wherever they choose to ride. So Foley faces a critical task: How do you build a single bike model that can serve the most people, in the most urban environments?

JUMP Bikes

JUMP currently operates 40,000 bikes across 13 cities, including San Francisco, New York City, and Chicago. They’re lock-to dockless, which means that JUMP obtains permits from the city that allow for the bikes to be locked to any fixed post on the sidewalk, like a parking meter or a bench.

Cities aren’t the only stakeholders. Last April, JUMP was bought by Uber. CEO Dara Khosrowshahi has also announced that he aims to bring the JUMP system to Berlin, followed by other European cities, later this year. Now, not only must JUMP bikes work well across American cities, but around the world.

Foley—who has been with JUMP since it launched as bike-sharing startup Social Bicycles in 2010—knows that the bike needs to adapt not only to a range of riders and styles, but to ever-transforming cities.

“It’s obviously not the perfect ride for every rider of all types. But what we’ve been able to do is achieve something that is a really, really great ride experience for almost every rider that gets on board our bicycle.” Foley pauses, resting his gaze on the bike. “And that is hard. There are a lot of ways to get that wrong.”

A Bicycle Built for 40,000

A JUMP bike stands at 44 inches tall and 69.3 inches wide. The wide-set handlebars measure 24.6 inches from end to end. It has an integrated basket, large enough to hold a backpack or a big bag of groceries. It’s GPS equipped, with a 250w motor and Shimano braking system. On a single charge, the bike’s battery can run for about 30 miles, which Foley says matches the distance most JUMP bikes go each day. Its aluminum frame is painted in the signature red.

Foley’s team test rode major urban commuting bicycle types from around the world, from English roadsters to Dutch city bikes. They envisioned the bike as a combination of features from international cycling styles.

At first, Foley wanted to emulate the relaxed grip of Dutch bikes, whose handlebars curve in a sort of U-shape around the user. “That’s a very upright and stable position,” he says, which would encourage an alert posture that allows urban commuters to look out for traffic and safety signals. But Foley noticed that if a rider raises and lowers their torso, the U-shaped grip puts strain on the rider’s wrist.

It’s a small problem for an individual rider, who rides at roughly the same height for every ride. But the bike needed a handling geometry that could serve a taller rider, whose torso would sit higher on the bike, as well as a shorter rider. So Foley and his team landed on a compromise: a frame with higher handlebars that curve just slightly toward the user, lending a somewhat upright posture that feels comfortable enough for riders of most heights.

The low frame was also built to hold a long adjustable seat post. It can extend almost 12 inches; by comparison, adjustable dropper posts built for consumer mountain bikes don’t generally extend past 8 inches. JUMP says that the JUMP bike can accommodate riders between 4’11” and 6’6” in height.

There are only slight modifications to the bike depending on a city’s needs. In most cities, JUMP deploys its 3-speed model. In San Francisco, JUMP bikes have 8-speed electric drivetrains to be able to power up the city’s notoriously steep hills.

Reinventing the Wheel

Unlike an individual consumer bike, shared bikes are under the constant assault of the sun, rain, potholes, and perhaps the biggest danger of all, the humans who ride them. They’re left outside day and night, and they get a lot more mileage than individual bikes. That means they need to be a lot more durable than other bikes.

JUMP tests the structural integrity of its bike by putting prototypes under every possible duress that could befall an urban bike. Foley describes the testing process: the bike prototypes are run for about 1,500 miles on rollers that replicate riding over cobblestone, with weights that simulate “a heavy load in the basket and a really heavy rider who’s riding kind of violently. And then we run those tests until parts start to fail or parts start to fall off.”

The rubber that covers the saddle and handles also went through its own stress testing. Besides the threat of rips and sun damage, Foley also took into account the constant sweat and accumulated human skin on the handlebars. That’s normally not a problem for a personal bike, but it’s something that a shared bike has to withstand, too.

Foley knows that bike-share users probably aren’t as careful with a shared bike as they would be with their own bike, so shared bikes must be durable enough to withstand the elements (both environmental and human-induced). And then there’s the problem of vandalism. Last month, a teenager riding a shared bike operated by LimeBike was hospitalized when the bike failed to brake and crashed into a tree. Police suspected that the bike’s brake cords had been slashed in an act of vandalization. To account for cord-cutting—accidental and intentional—the JUMP bike’s brake cables are fully encased inside the frame.

Kicking into High Gear

Last month, the first fleet of 400 cherry-red JUMP bikes sped through the streets of Providence, Rhode Island. It’s a small city, spanning just 18.5 square miles, and the land that car infrastructures consume, like parking lots, limits the city’s opportunities for economic development, according to Martina Haggerty, Special Projects Director at the City of Providence Department of Planning and Development.

“Bike-share is really important for us,” she says, noting that Providence started to consider implementing a bike-share program in 2009. The city saw bike-shares as a mobility solution for low-income residents (the level of income inequality in Providence is the third-highest in the country) as well as a way to meet sustainability goals. After years of trying to implement a bike-share system, a funding opportunity arose, and the city decided to sign a five-year contract with JUMP.

While cities have boosted bike-shares, the competition for those city-wide contracts is stiffening. Just months after Uber bought JUMP, Lyft acquired bike-share operator Motivate, which already operates popular bike-share systems like GoBike in San Francisco and Citi Bike in New York City. And Lyft, Uber’s Silicon Valley arch-rival, is far from the only competition. When JUMP makes its international expansion in Berlin, the e-bike brand will have to compete with international bike and scooter shares like Lime, Mobike, and Ofo. If JUMP wants to keep pedaling with the competition, it has to get the design of its bike just right.

The future of JUMP’s bike will require continual changes at every level. To keep the bikes adaptable to changing technology, Foley says that he’s made nearly all of the parts of the bike disparate and interchangeable. So while the bike operates like an integrated system, its parts can be easily swapped out in case an updated model comes along. Even now, Foley says that his team is currently testing another iteration of the red paint, one that is hopefully even more UV-resistant.

He’s at least decided on the paint color. When he was choosing the color of the bike, he said he took into account the color that it might fade to in ten, twenty years. When they landed on what would become JUMP’s signature scarlet, it reminded him of another feat of design that has withstood the test of time and tech. He says, grinning, “If the bike fades to match the Golden Gate Bridge, I’m gonna be really happy.”

The Reemergence of the Stormy Daniels Story Tops This Week's Internet News Roundup

First off, a not-fun stat for you to ponder: According to a new study released last week, more than 80 percent of the accounts that purposefully spread misinformation during the 2016 election are still active. At the same time, even Star Wars: The Last Jedi is being attacked by trolls with political agendas, because there’s nothing so minor that it can’t be ruined by 2018. How are we still even making it through this in one piece? It has to have something to do with the fat bears, right? Meanwhile, here’s everything else people found themselves talking about on the internet in the last seven days.

You’re Not Thinking. You Never Do

What Happened: As if anyone needed reminding, a press conference early last week really underscored that President Donald Trump can’t help himself when it comes to belittling women.

What Really Happened: Last week started with a surprising—and yet, mostly unsurprising—reminder of just how boorish President Trump can be.

The exchange, and reporting thereof—and there was a lot of reporting around this subject, because the press loves a press story—caught the attention of many, especially in the way it was framed by some as “sparring.”

A sign that some in the White House were acutely aware of how embarrassing the exchange was for the president came when the official transcript showed up and waswell, wrong.

That error, once publicly shared and shamed, was soon corrected.

If only the original comments could be fixed as easily.

The Takeaway: While Trump’s snipes at Cecilia Vega were loudly shared and shamed, it’s worth pointing out that he actually didn’t limit himself to demeaning just one female reporter during the press conference.

The Stormy Daniels Story Brews Again

What Happened: You really can’t keep the Stormy Daniels story down, but the latest development was not what anyone expected—unless you happened to be the other son of the president.

What Really Happened: Remember when Trump said that he didn’t know anything about Don Jr.’s meeting with Russians in Trump Tower until the news broke, and then it turned out that he dictated the initial statement released to the press? Well then, this week might’ve given you an unexpected sense of déjà vu.

As with all things, this is a far more nuanced story than it would initially seem on the face of it, so let’s seriously consider how best to summarize the reporting on this new development?

Oh, that works.

Yes, this was a muchshared development in a story we all thought was done, but really: Who saw this plot twist coming in the Stormy saga—and on the day Stormy’s book was released, as well? (Truly, the so-called “Trump Bump” is real.)

OK, perhaps that’s going a little bit too far, but still: You do have to wonder just a little how Eric approached the subject, don’t you? Just a little.

I mean, it’s not like it’s an easy subject to broach, really.

The Takeaway: At the heart of this whole story is this one sad fact.

Kava-Yay or Kava-Nah?

What Happened: Last week was another big one for Brett Kavanaugh.

What Really Happened: It’s been quite the week for Supreme Court nominee and professional beer enthusiast Brett Kavanaugh. As you may remember, two weeks ago Kavanaugh and one of the women accusing him of sexual assault, Christine Blasey Ford, testified before the Senate Judicial Committee. In the wake of that, a proposed vote on whether or not to place Kavanaugh on the Supreme Court was postponed after Senator Jeff Flake (R-Arizona) demanded the FBI look into the matter. With a depressingly short window in which to do so—the investigation had to be completed within one week—the postponement took effect, and the FBI opened its (limited) investigation.

Surely placing Kavanaugh under further scrutiny would be good for him, considering he so aggressively defended himself in the hearing, right?

OK, so that doesn’t look good for the judge, but surely nothing else would happen to contradict his testimony.

This New York Times story caused its own minor ruckus when it turned out that some of it was sourced with the help of someone who had previously stated that she did not want Kavanaugh to be placed on the court, but that was pretty much a surreal sideshow, made all the moreso by a strange comment on the matter by a Times spokesperson. But back to Kavanaugh, who had sworn under oath that he liked beer, but wasn’t a particularly over-indulgent drinker. Is it possible there’s evidence from the past that contradicts that? Let’s go back to the Times.

Then it escalated.

And escalated again.

With this in mind, it’s not surprising that some were choosing to distance themselves from Kavanaugh.

Thursday morning, the Wall Street Journal reported that the investigation was already over and that the White House had declared no wrongdoing. Immediately, concerns were raised about the investigation’s thoroughness.

As of this writing, it’s still believed that the Senate will vote to confirm Kavanaugh by the end of this weekend.

The Takeaway: On Saturday, the Senate voted to confirm Kavanaugh and he was subsequently sworn in.

Financial Support

What Happened: If you’ve been wondering just how true the president’s claims of being a self-made man really are, last week offered up an answer.

What Really Happened: For many, the question of just what financial support President Trump got from his father has long been an open one. Last week, the New York Times came up with what appeared to be the definitive answer.

For those who don’t want to read the whole thing, the Times actually came up with its own synopsis, because that’s how important the story was. Of course, other outlets wrote their own takeaways too, because that’s how important the story was.

You know who else thought the story was important? New York City Mayor Bill de Blasio.

As some pointed out, the potential legal implications aren’t necessarily what would upset Trump most about what the Times reported.

How did the president respond to the piece?

The Takeaway: By the way, the idea that, perhaps, this could have happened a little earlier wasn’t lost on everyone.

Trump Responds to Christine Blasey Ford’s Testimony

What Happened: Speaking of Trump and Brett Kavanaugh, amidst the kerfuffle last week the president did try to stand up for his Supreme Court nominee. It didn’t go well.

What Really Happened: It all started with a Trump rally on Tuesday.

His comments were wellcovered by a stunned press, because of course they were. Seriously, just think about this. So how did those comments go over with the folks Kavanaugh needed to win over to secure his place on the Supreme Court?

Yeah, that’s not looking too good. And even if all Senate Republicans didn’t speak out against the president’s comments, one influential party certainly seemed to be disappointed.

As is always the case, however, there were those who chose to defend the president.

The Takeaway: Let’s just go with this.


More Great WIRED Stories

You Don't Need to Find Your Tribe, You Need to Go Beyond It.

While history tends to single out individuals, the truth is that when you look behind the story of any heroic leader, what you find is a network of loyal supporters, active collaborators and outside facilitators that are behind any great achievement. Nobody accomplishes anything significant alone.

That’s probably why it’s become fashionable for pundits to encourage us to “find our tribe,” a network of like-minded people who share your ambitions. Don’t listen to them. The truth is that great things are achieved not by taking comfort from your tribe, but from going beyond it and reaching out to those who aren’t of like mind.

The problem with focusing too much on your tribe is that those people tend to think the same way you do. They frequent the same places, watch the same TED talks and read the same blogs. That may be great for giving you some comfort and confidence, but it also acts as an echo chamber that will reinforce flawed assumptions and lead you down a false path.

The Problem with Closed Networks

In 2005, a team of researchers decided to study why some Broadway plays become hits and others flop. They looked at all the usual factors, such as production budget, marketing budget and the track record of the director, but what they found was that what was most important factor was the informal networks of relationships among the cast and crew.

If no one had ever worked together before, both financial and creative results tended to be poor. However, if the networks among the cast and crew became too dense–for all intents and purposes, becoming a tribe–performance also suffered. It was the teams that had elements of both, strong ties and new blood, that had the greatest success.

The same effect has been found elsewhere. In studies of star engineers at Bell Labs, the German automotive industry and currency traders it has been shown that tightly clustered groups, combined with long range “weak ties” that allow information to flow freely among disparate clusters of activity, consistently outperform close networks of likeminded people.

Just as we need to invest in building strong, trustful relationships, we also need to go beyond our comfort zone and seek out new connections. It’s far too easy to hide in a tribe.

The Discomfort of Diversity

Just as studies show that closed networks lead to worse performance, it has long been established that diversity improves performance. Researchers at the University of Michigan found that diverse groups can solve problems better than a more homogenous team of greater objective ability. Another study that simulated markets showed that ethnic diversity deflated asset bubbles.

While the studies noted above merely simulate diversity in a controlled setting, there is also evidence from the real world that diversity produces better outcomes. A McKinsey report that covered 366 public companies in a variety of countries and industries found that those which were more ethnically and gender diverse performed significantly better than others.

Yet diversity also has a downside. In Political Tribes, Yale Professor Amy Chua notes that we are hardwired to be suspicious of others. For example, in a study where young children were randomly assigned to red or blue groups, they liked pictures of other kids who wore t-shirts that reflected their own group better. A study of adults had similar findings.

So you can see the attraction of tribes. We feel uncomfortable with people who we perceive as different. Surrounding ourselves with people who see things the way we do, on the other hand, makes us feel confident and powerful.

Mixing with the Heathens

Growing up in Iowa in the 1930s, Everett Rogers, noticed something strange in his father’s behavior. Although his father loved electrical gadgets, he was hesitant to adopt hybrid seed corn, even though it had higher yields. In fact, his father only made the switch after he saw his neighbors hybrid crop thrive during a drought in 1936.

This became the inspiration for Rogers’ now-familiar diffusion of innovations theory, in which an idea first gets popular with a group of early adopters and then only later spreads to other people. Geoffrey Moore later pointed out that most innovations fail because they never cross the chasm from the early adopters to the mainstream.

A study done by researchers at Kellogg and Stanford explains why. They put together groups of college students to solve a murder mystery. The groups made up of students from the same sorority or fraternity felt more confident and successful, even though they performed worse on the task than integrated groups that experienced more conflict, uncertainty and doubt.

That’s the problem with staying in your tribe. Sure, it feels great to have your ideas supported and reinforced by people you like and respect, but they are doing so because they already believe the same things that you do. To actually achieve something worthwhile, however, you have to go beyond preaching to the choir and start mixing with the heathens.

Do You Want to Make a Point Or Do You Want to Make a Difference?

In my upcoming book, Cascades, I cover a wide range of movements. Some, like the civil rights movement and the campaign to save 100,000 lives, succeeded brilliantly. Others, like Occupy and the technology companies along Boston’s Route 128, failed miserably. Another thing I found is that many movements that ultimately succeeded, failed initially because they failed to go beyond their tribe

These were very ‘Occupy’ type of protests where we occupied the five biggest universities and lived there in our little islands of common sense with intellectuals and rock bands while the rest of the country was more or less supportive of Milošević’s idea. And this is where we began to understand that staying in your little blurb of common sense was not going to save the country.

In a similar vein, Nelson Mandela started out as an angry nationalist, but eventually learned that to get results, he would have to actively collaborate with others that didn’t quite see things the same way he did. In Poland, Solidarity’s first actions were disastrous, because they only involved workers. It was only through a later alliance between workers, intellectuals and the church that the movement ultimately succeeded.

Today, both America and the world have become increasingly tribal and it’s easy to retreat into what Srdja calls “your little blurb of common sense.” You can state your beliefs, make your point and see the heads nod around you. You can live in comfort, knowing that any voices of dissent will be quickly shouted down, as you self righteously feel they should be.

However, at some point, you will have to decide if you want to make a point or whether you want to make a difference. To achieve anything worthwhile, you have to go beyond your tribe.  

Hell Is Other People. This New List of the Most Stressed Out States Proves It

It makes sense to me. People do seem a little more high strung here.  

But then I looked deeper. The least-stressed state? Iowa, supposedly. Followed by Minnesota and North Dakota. (I think I’d be stressed out about the cold, alone.)

And right behind New Jersey, second-most stressed? Georgia, according to this study, and then Florida. Hmmm. Neither really struck me as particularly in the same category.

And then it hit me. They say that “hell is other people.” So I compared this list to a ranking of the most urbanized states–and the correlation was stunning. For a strong majority of the states, their ranking on the most-stressed out list was within 10 spots of their ranking on the most-densely populated list.

Here’s the list of most-stressed states, coupled with their rankings in terms of how urban they are. Yes, there are a few outliers, but by and large, “more urban equals more stressed.”

Let us know in the comments what you think of your state’s placement on the list.

1. New Jersey

Stress Rank: 1

Urban Rank: 2

Difference: 1

Most stressed state. Second most urbanized. We’re off to a strong start.

2. Georgia

Stress Rank: 2

Urban Rank: 23

Difference: 21

Okay, already we have a problem: Ranked #2 for stress, and #23 for urbanization. But, this was one of the biggest stress/urban gaps. The folks at Zippia, who complied the list, explain it partly by saying that because the state is so sprawling, many people live in a less urban area, but have to commute into one each day.

3. Florida

Stress Rank: 3 Urban Rank: 6 Difference: 3 Back on track. The difference here is just three. Florida is a lot more urban than many people realize. (Also, there’s a really high rate of people who don’t have health insurance.)

4. California

Stress Rank: 4

Urban Rank: 1

Difference: 3

Don’t let the beaches, deserts and farms fool you; when you add up the cities, California is by far the most urban state. And it’s #4 for stress.

5. New York 

Stress Rank: 5

Urban Rank: 12

Difference: 7

Obvious a high urban ranking, and a high stress rate. What do you expect from a state that contains the city that never sleeps?

6. Louisiana

Stress Rank: 6

Urban Rank: 27

Difference: 21

A bit out an outlier, but not radically so. Zippia opines that it’s because people work an especially high number of hours a week.

7. Maryland

Stress Rank: 7

Urban Rank: 13

Difference: 6

No surprise. Quite urban, very stressed.

8. North Carolina

Stress Rank: 8

Urban Rank: 36

Difference: 28

The high uninsured rate in North Carolina made it rank more stressed than it otherwise would have.

9. Virginia

Stress Rank: 9

Urban Rank: 22

Difference: 13

Similar to Georgia: the urban rank isn’t super high, but the percentage of people commuting from exurbs and rural areas to Washington D.C. leads to higher stress.

10 Mississippi

Stress Rank: 10

Urban Rank: 47

Difference: 37

Mississippi was one of the few states with a very high urban/stressed differential. According to Zippia, it’s because the state just isn’t doing very well, period. Comparatively high unemployment, very low insurance rates, and long hours worked for those who do have jobs.

11. South Carolina

Stress Rank: 11

Urban Rank: 34

Difference: 23

Another one of the slight outliers, but with a similar likely explanation: people live in rural areas, but have to commute to urban ones. Also, high uninsurance rates.

12. Texas

Stress Rank: 12

Urban Rank: 15

Difference: 3

Big state, big urbanization, big stress.

13. Illinois

Stress Rank: 13

Urban Rank: 10

Difference: 3

Again: the stress rank and urbanization rank are very close.

14. Nevada

Stress Rank: 14

Urban Rank: 3

Difference: 11

So many people live in and around either Las Vegas or Reno. Urban rank is very high, stress level is high, too.

15. Arizona

Stress Rank: 15

Urban Rank: 9

Difference: 6

A small differential between Stress Rank and urban rank.

17. Alabama

Stress Rank: 17

Urban Rank: 42

Difference: 25

Again, we see one of the southern states with a fairly high differential, which seems to be explainable by a lower standard of living from a financial standpoint, including low insurance rates.

18. Hawaii

Stress Rank: 18

Urban Rank: 5

Difference: 13

I’d be interested to see Hawaii broken down by island in terms of stress rates. Once you get off Oahu, it’s pretty mellow. But even so, stress and urbanization rates are pretty similar.

19. Alaska

Stress Rank: 19

Urban Rank: 37

Difference: 18

Alaska has some of the same stress explanations as some of the southern states, despite its outlier differential between urbanization and stress level.

20. Massachusetts

Stress Rank: 20

Urban Rank: 4

Difference: 16

Why does Massachusetts have a lower stress rating than you might expect? One key reason would seem to be the very high rate of medical insurance.

21. Connecticut

Stress Rank: 21

Urban Rank: 11

Difference: 10

Having lived in Connecticut, I would have thought it would rank higher for stress. But its cities are smaller, and the state is less urban.

22. Washington

Stress Rank: 22

Urban Rank: 16

Difference: 6

Moderately urban, moderately stressed.

23. Colorado

Stress Rank: 23

Urban Rank: 14

Difference: 9

Pretty close on both urban and Stress Rankings.

24. Delaware

Stress Rank: 24

Urban Rank: 17

Difference: 7

Hardly worth mentioning the difference.

25. Rhode Island

Stress Rank: 25

Urban Rank: 7

Difference: 18

A bit of an outlier, but not by much.

26. Pennsylvania

Stress Rank: 26

Urban Rank: 19

Difference: 7

Very close in terms of urban and Stress Ranking.

27. New Mexico

Stress Rank: 27

Urban Rank: 21

Difference: 6

Again, very close.

28. West Virginia

Stress Rank: 28

Urban Rank: 48

Difference: 20

Once again, a very low urban rate would predict less stress, except for the financial stress that residents are under. Low health insurance rate doesn’t help, either.

29. New Hampshire

Stress Rank: 29

Urban Rank: 40

Difference: 11

Pretty close urban and Stress Rank.

30. Oregon

Stress Rank: 30

Urban Rank: 18

Difference: 12

Similar to New Hampshire, except it’s going the other way: ranks a bit less stressed than you might imagine, but still pretty close.

31. Arkansas

Stress Rank: 31

Urban Rank: 45

Difference: 14

A 14 point difference pushes the boundaries a bit, but once again, the low health insurance rate is a big factor.

32. Oklahoma

Stress Rank: 32

Urban Rank: 35

Difference: 3

Not very urban, not very stressed.

33. Kentucky

Stress Rank: 33

Urban Rank: 43

Difference: 10

Same thing: less urban, less stressed.

33. Tennessee

Stress Rank: 33

Urban Rank: 33

Difference: 0

One of two states where the differential was zero.

34. Indiana

Stress Rank: 34

Urban Rank: 29

Difference: 5

Once again: Fairly rural, fairly unstressed.

35. Missouri

Stress Rank: 35

Urban Rank: 31

Difference: 4

Another with a low differential.

36. Wisconsin

Stress Rank: 36

Urban Rank: 32

Difference: 4

And yet another.

37. Ohio

Stress Rank: 37

Urban Rank: 20

Difference: 17

A small outlier, but not too far off. I don’t have a great explanation for this one, but good for Ohioans who are in a fairly urban state, but don’t have as much stress.

38. Wyoming

Stress Rank: 38

Urban Rank: 38

Difference: 0

My second favorite state for this purpose, because its urbanization and stress rates are identical.

39. Montana

Stress Rank: 39

Urban Rank: 46

Difference: 7

Seven points difference isn’t that much.

40. Idaho

Stress Rank: 40

Urban Rank: 30

Difference: 10

Within 10 points. It’s a pretty nice place to visit, by the way.

41. Maine

Stress Rank: 41

Urban Rank: 50

Difference: 9

I hadn’t realized Maine was the least urban state in the country. But it is, and it’s also one of the least stressed.

42. Kansas

Stress Rank: 42

Urban Rank: 25

Difference: 17

A little bit of an outlier… but not too far off.

43. Utah

Stress Rank: 43

Urban Rank: 8

Difference: 35

Okay, there is just something about Utah. I don’t think I’ve ever met a high strung person from there. But its differential is an outlier.

44. Michigan

Stress Rank: 44

Urban Rank: 24

Difference: 20

Fairly close. A tough regional economy could explain a lot of this.

45. Vermont

Stress Rank: 45

Urban Rank: 49

Difference: 4

Tiny differential.

46. South Dakota

Stress Rank: 46

Urban Rank: 44

Difference: 2

Even tinier differential.

47. Nebraska

Stress Rank: 47

Urban Rank: 28

Difference: 19

While Nebraska has a higher urbanization rating than you might expect, it’s still not very densely populated, which sort of offsets the differential.

47. North Dakota

Stress Rank: 47

Urban Rank: 41

Difference: 6

Very cold, but very low differential.

49. Minnesota

Stress Rank: 49

Urban Rank: 26

Difference: 23

Fairly high urbanization and low stress. Let’s call it an outlier and chalk it up to Minnesota Nice.

50. Iowa

Stress Rank: 50

Urban Rank: 39

Difference: 11

The least-stressed state in the country. Congratulations Iowa. And a low differential. I rest my case.

Specialized Men's Turbo Levo Comp Review: A Pedal-Assist Mountain Bike That Rips Up the Trails

Signing on to test the new Specialized Turbo Levo mountain bike is a little like making a deal with the devil—especially if you live in a town, like I do (Duluth, Minnesota), where e-bikes aren’t allowed on the 93 miles of IMBA gold-medal-level, purpose-built singletrack. There are many purists out there who firmly believe that only those who can ride trails under their own power should have access to them. My sensibilities fall in that camp, but in the name of open-minded evolution and a hardwired quest for fun, I felt obliged to test the new bike anyway.

Haters, you’re going to cringe at my conclusion: This e-bike is a blast. Before you dismiss me as a traitor and a slacker, hear me out on why the bike deserves to exist on authorized trails.

For starters, Specialized employed 40 people to design this bike, hiring three system engineers whose sole job was to make sure every component would seamlessly integrate. Being bike manufacturers, they started with the frame design: The Levo uses the same asymmetric frame as Specialized’s new Stumpjumper, which makes the bike 20 percent stiffer over the previous Levo while reducing its weight by 110 to 550 grams. It’s also longer and slacker in the front, which translates to a flowing, precision ride on downhills.

Working off the benefits of that frame design, Specialized worked to integrate a motor within it. First, the company designed and perfected its proprietary software. Then they hired manufacturer Brose to wrap the inner workings in magnesium, which makes the motor 14 ounces lighter. When you make a motor, you also have to figure out where and how to mount it on the bike. The solution was to use a direct motor-to-frame system The motor mounts on the bottom bracket, which shaves off an additional 14 ounces. Like all Type 1 vehicles, the max speed the motor allows is 20 mph. But when it reaches that 20 mph max, the two freewheels in the motor disengage from the crank and the bike starts pedaling naturally, which makes it a much smoother ride.

Spinning Electrons

In the highest-end S-Works ($12,050) and Expert Levo ($8,250) models, Specialized amped up the battery up to 700 watt-hours—200Wh more powerful than the standard e-mountain bike. This gives it a whopping 40 percent longer life and extinguishes riders’ “range anxiety,” that sinking feeling that you’re going to be stranded in the back of beyond with a behemoth bike after the battery dies. In the alloy models like the Turbo Levo Comp, the battery is 500Wh, the industry standard. Both the 500Wh and 700Wh models are 15 percent smaller and 11 percent lighter and housed in the downtube.

To control the motor’s brains, Specialized installed a small Turbo Connect Unit (TCU) on the top tube. The TCU turns the bike on and tells the rider how much power the battery has—one LED bar equals 10 percent of the battery’s charge. For more data, Specialized upgraded its Mission Control app (available for Android and iOS) which allows the rider to connect to the bike over Bluetooth, then tune it, diagnose it, track rides, and connect to third-party platforms like Strava.

The best new features: “Smart Control,” which acts as a governor, regulating the power of the motor to ensure that a desired battery capacity is retained throughout the selected length of the ride; and “Shuttle Mode,” which gives maximum power output with less required pedaling force for going uphill fast with to get in more downhill runs.

Pedal Power

All of this sounds fantastic on paper, but how does it translate to the trail? Quite seamlessly. I started my first 2.5-hour test of the alloy Turbo Levo Comp on a mile-long bermy, bumpy downhill flow trail. Despite the Levo being roughly 20 pounds heavier than the carbon Stumpjumper, it felt surprisingly similar—stable, deftly absorbing bumps, and cornering well in the berms with its 150 mm of travel in both the rear shock and front fork. The almost silent whirr of the motor was mesmerizing, with no glitchy cutouts or surges in power.

I soon learned, however, that if my weight was too far forward, especially on tight rollers, I was dangerously close to flying over the bars. This ensured that I couldn’t get lazy. I had to play close attention to my technique throughout the downhills. This is why some coaches like to use e-bikes as a teaching tool: The bikes allow riders to reach higher speeds more regularly with less effort and more easily simulate a racing scenario.

My only crash of the three-day test came when I engaged “Smart Control” on the downhills. Without being able to click into turbo mode, I didn’t generate enough speed going into berms. In one instance I found myself too high, too slow, and washed out the front wheel.

My guiltiest pleasure while riding the Turbo Levo was engaging full Shuttle mode on a particularly challenging 800-foot singletrack climb. I confess I was cheating a little: Real athletes would have ridden uphill in the battery-saving eco mode, forcing a more challenging workout. But the battery-juice-munching climb was worth it. I felt like a superhero, or at least a doped cyclist, as I charged up the steep, technical stretch, beating my boyfriend Brian by a solid five minutes.

“Wow, that thing is the great equalizer,” Brian said when he finally reached the top, sweat dripping out of his helmet. But my e-assisted hard charging gave Brian even more incentive to beat me riding back down. He did so with ease. Which brings me to the reality that any bike is only as fast and technically proficient as its rider, so invest as much time in developing your skills as you would investing money in your e-mountain bike.

MannKind Is A Better R&D Company Than A Full Service Pharma Company

For almost as long as I have covered MannKind (MNKD) I have always stated that I would rather see this company as a research and development entity than one that is attempting to get into the business of sales and distribution. My opinion on that front became more solidified when it was blatantly apparent that MannKind was really struggling to deliver Afrezza sales numbers that were able to impress the Street or help the bottom line.

The pipeline deal with United Therapeutics (UTHR) gave some new life to the idea that MannKind might be able to shift its business model to something more in line with what I have always seen as the best opportunity for this stock. To that end, MannKind seems to be focusing its more recent presentations to the possibilities of the pipeline, a move which I applaud.

In my opinion, the perfect situation would be one that saw the company essentially sell off Afrezza and make a pronounced shift to the pipeline. To see some flavor on the possibilities with such a move, investors can look to Arena Pharmaceuticals (ARNA). Arena was in a very similar situation to the one MannKind finds itself in. The company developed a drug, got a big partnership deal, saw that partner essentially pull out, and was wallowing along without enough capital and with prospects that were not very compelling. The main difference is that Arena had a more mature pipeline that was closer to seeing new drugs come to fruition than what MannKind has. To make a long story short, Arena essentially sold off the first drug for some upfront cash and a royalty and shifted its entire business to its pipeline. Today, Arena has three very mature drugs in its pipeline and is on the cusp of either partnerships or FDA approval.

The issue here is simple, and it is something that less experienced investors often seem to miss. The Street will place more value on potential than it will on a drug that has a history of poor sales, or even one that is growing, but growing very slowly.

If MannKind were to announce that it had a buyer for the Afrezza franchise, the company could trim back its expenses greatly. If it were able to garner $50 million for the Afrezza move and add another $100 to $150 million with an offering, we would have a company that has a better appearance to Wall Street.

MannKind, as it currently exists, is paying out almost $1 million per week for selling and marketing, and another $200,000 plus in rebates, discounts, returns, etc., whilst paying out just $200,000 per week in research and development. Imagine what could transpire if monies were dedicated to the pipeline rather than attempting to sell a drug that is simply not selling well.

In its most recent presentation at Cantor Fitzgerald, management had to spend time discussing Afrezza, which, in my opinion, is a detraction from the current pipeline possibilities. If one were to look at the presentation in a vacuum, it was quite good. That being said, if one does a little digging (which the big players will do), you start to see the weak spots. Some examples below relative to a milestone checklist of management:

Chart Source – MannKind Corp.

Looking at the chart, it would appear that every goal management has outlined is tracking well. Looking deeper though, we see where there is some weakness. Let’s assess one at a time.

Growth Trajectory Continues With Afrezza

On its face, it is a truthful statement. The problem is that the growth trajectory is not even meeting management’s own stated goals, and is not a trajectory that impresses the Street. In fact, it can be argued that the growth trajectory delivered is getting more costly to support. Management might put a check mark next to the bullet point, but I would characterize this point as incomplete.

FDA Label Change 2017

Indeed, a label change happened. The issue here is that the company did not get everything it wanted, and compounding the problem is that the label change has not really shifted the trajectory on sales.

Completion of STAT

This sounds great, and did happen, but what has the impact been? It was a small study that provides some anecdotal data, but lacks the scope, size, and design to really move the needle in a way that will help the bottom line. It is a study that provides enough positive data to warrant additional studies, but funding those may not deliver the needed value in a reasonable time frame.

IND Filed For TreT and Partnered With United Therapeutics

This is the best accomplishment. I applauded the phase 1 trial of TreT as a smart choice. It was a great candidate with great odds for success. Attracting a partner was a big boost. In my opinion, MannKind did not get all that it could have in the deal because of a lack of leverage, but it does point to the possibilities of Technosphere as having real potential. The check mark in this bullet point is warranted.

Increase Payor Coverage

This is another statement that on its face is true. That being said, the level of coverage is still disappointing. MannKind made a big move in May of this year, but since then the coverage has not had much traction, and despite this better move in May, the sales trajectory has not shifted by very much. Many formularies will be re-established here in October, so this bears watching.

Chart Source – Spencer Osborne (based on data from FingertipFormulary)

In simple terms, Afrezza is on lower level tiers and still carries many restrictions. It will be costly to get onto higher tiers.

Recapitalization (Complete upon UTHR closing)

This bullet point is off of the mark, in my opinion. This company is not near being fully funded. The United Therapeutics deal does provide a couple of quarters worth of cash in the near term and possibly another couple of quarters during the next 2 years. But beyond that, the company still needs cash. Currently the company has some breathing room in until 2021, but it will need to address some substantial debt payments that year.

International Expansion

Management checks this box, but the deals it has established thus far have lacked attractiveness. There was no upfront money for Brazil, and minimal upfront money for India. The company has stated it intends to file for approval in Mexico and Canada. In my opinion, the Brazil and India deal will help the company use up contracted insulin, but will not be a driver of substantial cash making it to the bottom line. The insulin contract with Amphastar is a big burden to MannKind. The company still has to pay Amphastar almost $100 million over the next 5 years. As yet, the company is not able to use all of the insulin it must buy. International deals help use up what would otherwise expire, but until Afrezza can actually help the bottom line, it remains a burden that investors consider.

Of the seven bullet points that the company outlined as complete, five of them relate to Afrezza. Of the three remaining bullet points two relate to Afrezza. Perhaps the most important point that remains is a Co-Promote deal for the inhaled insulin. As yet, the company has not really defined what it means by co-promote, and due to a lack of analyst coverage, has been able to keep that point as undefined. If a co-promote partner were to take over the drug, pay the ongoing trials, absorb the insulin purchase requirements and simply pay MannKind a manufacturing contract and royalty, I think that the Street would celebrate the deal. Even if it was for a relatively small upfront payment.

Simply stated, I like MannKind as an R&D company much more than I like it as a company trying to mount its own sales force, and spending money on marketing, patient management, etc.

The deal with Receptor Life Science could be compelling if something were to actually happen. The cannabinoid sector is hot at the moment. Some of my regular readers have likely already seen some healthy returns of Youngevity (YGYI), a company I cover that is entering the CBD space and working toward a field-to-finish hemp and CBD oil capability. The current problem is that Receptor Life Science is on radio silence and has been for years. If RLS were to break radio silence while that sector is hot, it could provide a compelling move in MannKind stock. That, however, is a big if, but let’s take a moment to assess.

If MannKind were to be able to extract itself from Afrezza costs at the same time that it is able to announce something in the cannabinoid space, it could provide the very best opportunity for the stock to rise, the warrants to get taken out, and even provide for an offering that could raise enough capital to fund bringing some pipeline candidates forward, which could in turn bring in added partners.

Let me make this clear. I am not anti Afrezza. I feel that the product has some compelling attributes that can serve needs within the diabetes space. My issue with Afrezza is that MannKind cannot afford to market the drug the way that it needs to be marketed, and it has some legacy deals (Amphastar – and Deerfield milestones) that will make it difficult for any company to see a quick return on the drug without making a substantial investment into marketing it. That means that such a company would need to minimize its acquisition costs on the rights. If MannKind had hundreds of millions in the bank, and a pipeline that was a bit more mature, it could be worth continuing the efforts with Afrezza. Unfortunately, MannKind does not have that level of cash, and does not have a more mature pipeline.

With all of that being said, MannKind could be a great speculative play on the possibility of RLS alone if RLS gets moving. I am oft asked what would make me bullish on MannKind. The answer is rather simple.

  • Getting fully funded
  • Getting a more mature pipeline
  • Getting out of the sales and marketing business
  • Getting leaner on overhead and more swift on R&D
  • Recapitalizing existing debt and getting a cash stockpile to develop new drug candidates

I know that there are some readers that are full-fledged members of the “Afrezza Army.” Much of what I am saying in this article may be upsetting to those readers. My answer to you is simple. The investment is in MannKind, and not Afrezza. Public companies need to re-invent themselves, grow, and be nimble enough to shift the path when the situation dictates. Some might even say that the best chances to see Afrezza succeed may be in the hands of another company. Do not fear it. Celebrate it.

It is clear that the Street is looking to put money into inhaled solutions. Look no further than Liquidia (LQDA). That company was $11 per share just 2 months ago. Today it trades at nearly 3 times that level. Liquidia is focused on research and development. Liquidia has a story that the Street likes. Liquidia is not (at least not yet) attempting to be a pharma company that takes a drug to approval and then tries to market it alone.

There are many times that I would have been a player in trading MannKind stock. I committed to not buy the stock as long as I was actively writing about it, thus have no shares. In fact, I have never had a position in MannKind. That being said, I have made clear when the opportunities exist to trade this effectively, or even build a longer term position as a speculative play in one’s portfolio. MannKind has had a tendency to be late to the game in many respects, and to box itself into corners on the financial front. These are things that can be repaired, but it takes a bold move on the part of MannKind and a bold move on the part of potential investors and partners.

There is opportunity here for traders as there has always been. There is also more upside speculative potential than has existed in the past. Is MannKind going to rocket to the moon so fast that investors miss out? Not in my opinion. Can it make a substantial pop on the right news? Yes. Investors should not get themselves so hung up on the potential without balancing it with the cash situation, cash commitments, and cash flow. There will be bears that will argue that Technosphere cannot make it and that it is expensive. I do not subscribe to that thesis. What Technosphere needs is funding. In my opinion, the Street could be eager to fund Technosphere programs. What I do think the Street is not eager to fund is Afrezza sales and marketing efforts. That is simply my opinion based on the lack of appetite of the Street to play MannKind stock in a bigger way. If MannKind can re-invent itself, there could be a much more compelling story in the making. Stay tuned!

Disclosure: I am/we are long YGYI, ARNA.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Is The Tilray-Sandoz Canada Alliance Worth Getting Excited About?

Based on price action, Tilray Inc. (NASDAQ:TLRY) is currently the most exciting name in the very hot Canadian pot stock space. Also based on price action, Novartis AG (NYSE:NVS) is a boring Big Pharma stock. While I have previously warned investors that pot stocks are unlikely to be good buy-and-hold stocks, TLRY seems to have its supporters.

A point of difference between TLRY and other pot stocks is that it has a collaboration with Sandoz Canada, the Canadian arm of Sandoz, Novartis AG’s generics business. The aim of this article is to see if this collaboration justifies any of the current hype surrounding TLRY and if it might be something worth getting excited about for NVS investors.

Chart

TLRY data by YCharts

Figure 1: 2018 has been another boring year for NVS but an exciting beginning for TLRY

The TLRY-Sandoz Canada alliance

On March 18, 2018, TLRY issued a press release noting it had signed a binding letter of intent, which in concert with anticipated agreements to follow, allied TLRY with Sandoz Canada. TLRY noted it had become the exclusive collaborator of Sandoz Canada to “accelerate innovation and increase availability of high quality medical cannabis products.” So TLRY and Sandoz were set to sell cannabis together.

On June 19, 2018, Sandoz Canada announced that it had finalized the collaboration agreement. It noted that eight TLRY-Sandoz co-branded, non-combustible medical cannabis products were now available, including three dosages of capsules and five strengths of oils.

Figure 2: Eight products available under the TLRY-Sandoz Canada alliance. Source: TLRY website.

The Canadian medical cannabis market

Although legal access to cannabis for medical purposes in Canada came online during the period of 1999-2001, the initial framework for patients to access cannabis, coupled with the unwillingness to prescribe by many physicians, led to an initially tepid pace of growth. From humble beginnings, however, the medical cannabis market in Canada has transformed into a sizable industry.

Arcview Group and BDS Analytics have suggested the Canadian legal cannabis industry will generate $1.3 billion in 2018 ($600 million of that from medical use) and $5.4 billion in 2022 ($500 million of that from medical use). The predicted drop in revenues from medical cannabis is based on the fact that legalization may lead to those previously obtaining cannabis via the more complex medical route to simply obtain it as those using cannabis recreationally will. There are, however, two key factors which might offset patients switching from obtaining cannabis via the medical route to the newly legal recreational route come October 17, 2018. The first factor is that physician attitudes to prescribing cannabis continue to improve, which means prescribing might continue to increase, generating new patients.

Figure 3: Results from two studies examining attitudes among Canadian physicians to prescribing cannabis. The two studies were commissioned by CanniMed Therapeutics (OTC:CMMDF), which was subsequently acquired by Aurora Cannabis Inc. (OTCQX:ACBFF). Source: CMMDF prospectus.

The second factor is the recent commencement of coverage for medical cannabis by Canadian health insurers. For example, in February, Sun Life (NYSE:SLF) announced it would offer optional medical marijuana coverage of up to $6000 yearly per person in select conditions, including cancer pain and rheumatoid arthritis. In June, Markers Financial Inc. announced it too would soon offer coverage for medical cannabis prescriptions. For patients with insurance coverage, it may not make sense to access cannabis by the recreational route, although this will depend how much they would normally spend on cannabis.

Should NVS investors get excited?

The initial press release concerning the TLRY and Sandoz collaboration was just from TLRY – not TLRY and Sandoz (a Novartis division) or TLRY and NVS itself. Compare that to other developments which Sandoz felt it was worth bothering investors with, such as a collaboration with Biocon (OTC:BCNQY) to develop biosimilars. The same can be said of NVS, which does tend to issue a press release on major collaborations and their developments.

However, the website of Sandoz Canada does include press releases related to its collaboration with TLRY and medicinal cannabis. Now, this might seem like a simple way to analyze the impact of this new collaboration, but the point is that if NVS hasn’t bothered investors with this development, it might not be hugely material. If Sandoz Canada is talking about it, then it is relevant on the level of Sandoz Canada, which is not a stock you can buy.

NVS reported net sales of $49.1 billion in 2017, so even if Sandoz Canada and TLRY captured the entire Canadian legal medical cannabis market (say $500-600 million), that would not be a game changer for NVS. Rather, such an unlikely scenario (capturing an entire market) would be similar to NVS getting a new drug approved which is not quite a blockbuster. Then, Sandoz Canada’s entry into the Canadian medical cannabis space can be thought of as simply another recently approved drug in the NVS portfolio.

Figure 4: Breakdown of NVS sales by geographic region, including Canada/Latin America, and by division. Source: NVS 2017 annual report.

For the medical cannabis space to become more important to NVS’s bottom line, Sandoz Canada and NVS will need to do two things. The first would be to grow the market in Canada, don’t let it peak as the recreational route becomes legal. The second thing would be NVS (or other regional arms of Sandoz) to enter the medical cannabis space in other countries. NVS investors should keep an eye out for that second potential development, because the Sandoz Canada-TLRY collaboration does suggest that NVS is taking cannabis seriously, and so, collaborations in other countries seem possible (not necessarily with TLRY). Combined medical cannabis revenues from multiple countries could be a bit more meaningful for NVS and its investors.

Regarding attempts not to let the legal medical cannabis market peak too soon in Canada, Sandoz Canada is making moves. One of the attempts to further legitimize medicinal cannabis in the minds of unwilling physicians can be seen in a recent PR from Sandoz Canada, where the company essentially suggested pharmacies could serve as an ideal place to dispense medicinal cannabis.

If cannabis is used to treat a medical condition, Sandoz Canada believes that it should be distributed through appropriate channels to properly regulate the therapeutic intent of the treatment. If medical cannabis is authorized by a healthcare professional, it would be logical for it to be distributed by another professional, such as a pharmacist, so that patients can benefit from adequate follow-up and guidance from healthcare professionals if they wish. Sandoz Canada will share this vision during the upcoming consultation launched by the Ontario government.

– Sandoz Canada press release, August 15, 2018.

Even if the market doubles or holds steady thanks to the efforts of Sandoz Canada and others in the space, NVS will need to enter other worldwide markets before the cannabis business becomes a big line item on the balance sheet. NVS investors can stop here then.

Should TLRY investors get excited?

Although the medical cannabis market is not the size of the recreational market, TLRY does have some potentially competitive products worth review. One of the oils available as part of the Sandoz Canada collaboration is Tilray 2:100 (also known as TIL-TC150), which contains 2 mg/mL of Δ9 tetrahydrocannabidiol (THC) and 100 mg/mL of cannabidiol (CBD). On August 1, TLRY issued a press release noting published results from a phase 2 study of TIL-TC150 in children with a type of epilepsy called Dravet syndrome (notably, these patients had drug-resistant epilepsy). Twenty children in the study received TIL-TC150, 19 of them completing 20 weeks of treatment with TIL-TC150 being used as an add-on to existing anti-convulsant therapy. There was no control group in the study, but the drug did produce a statistically significant improvement in quality of life – and a statistically significant reduction in seizure count – at week 20 (compared to baseline).

Figure 5: Change in seizure frequency based on patient seizure diaries. Each column represents a patient, and the percentage change is calculated based on a comparison of weeks 17-20 (endpoint period of the study) to weeks -4 to 0 (lead-in portion of the study when patients were not on TIL-TC150). Five patients did experience an increase in seizures based on that comparison, whereas two patients were unchanged and 12 experienced a decrease in seizures (two patients had a 100% reduction and were thus seizure-free during weeks 17-20). The overlaid line represents the average change in seizures frequency across the 20 weeks of treatment. Source: Publication in Annals of Clinical and Translational Neurology.

Despite the size of the study I find the results to be quite promising. I would like to see TLRY run follow-up studies, which the press release indicates TLRY will, with some sort of control group (be it placebo or active comparator). TLRY is not really a biotech/pharma company, although it is making drugs and selling them, and so, it might need some help furthering that clinical development. The phase 2 study in Dravet syndrome was designed and conducted by researchers at The Hospital for Sick Children in Toronto. Larger studies might require enrollment across multiple sites, and so, more expertise might be required to plan such studies, including hiring a contract research organization. TLRY might also need to make new hires to bring additional expertise on board (TLRY has some of the necessary people on board already). Another possibility is a partnership with a company with expertise in clinical development. With a partnership with Sandoz Canada already in place, the possibility of NVS stepping in to help with clinical development seems like a bright idea, although this is speculation on my part.

One last thing worth noting about the August 1 press release is the clarity with which the results and their meaning were presented. The press release even noted the limitations of the phase 2 study (that is not something seen often from biotech companies). I have to give TLRY some credit for its transparency.

A limitation in this study concerns the small number of participants, the majority of whom were already taking a prescribed antiepileptic drug. Tilray donated product for the trial and funded the research. Next steps include additional research with more participants and variable doses of combined THC/CBD.

– TLRY communicates clearly with investors in its August 1, 2018, press release.

If the company is to continue clinical studies on its medical cannabis products, it would do well to note the methods of GW Pharmaceuticals plc (NASDAQ:GWPH), which has been successful in its studies.

TLRY is no GW Pharma competitor yet

GWPH is a biopharmaceutical company with a market cap of ~$4 billion, focused on the development and marketing of plant-derived cannabinoid therapeutics. The company has marketing approval for Sativex (an oralmucosal spray containing THC and CBD in a 1:1 ratio along with other minor cannabinoids) in a number of ex-US territories, including approval in 21 European countries.

GWPH has run placebo-controlled, double-blind, randomized clinical trials demonstrating the efficacy of Sativex in spasticity due to multiple sclerosis (including a 572-patient study published in 2011 and a 337-patient study published in 2013). It is currently in phase 3 trials in the US for the same indication, and so, approval is likely not far away in that market (Sativex is already available in Canada).

The company also markets Epidiolex (plant-derived CBD), which was recently approved in the US for Dravet syndrome and Lennox-Gastaut syndrome. A timeline for submission of Epidiolex to the regulator in Canada is unclear.

Figure 6: GWPH has produced an impressive body of clinical research with Epidiolex as it did with Sativex. Source: Company investor presentation.

It seems likely that Epidiolex, should it gain approval in Canada, is going to have an advantage over non-approved formulations like TLRY’s Tilray 2:100 in Dravet syndrome and Lennox-Gastaut syndrome (as much as I like the data seen with Tilray 2:100). Physicians could prescribe Epidiolex to their patients like they would any other drug for epilepsy and know they are getting a product which has undergone multiple clinical trials and is approved by the Canadian regulatory authority. Now TLRY could one day seek approval for its products, but GWPH is obviously far ahead, with Sativex already on the market and Epidiolex already having completed clinical studies in two indications.

… we are working hard to make EPIDIOLEX available within the next six weeks as we know there is excitement for a standardized version of cannabidiol that has undergone the rigor of controlled clinical trials and been approved by the FDA.

– GWPH comments in September 27, 2018, press release. Note these comments apply to the US market, but a similar argument could be made for the Canadian market, were Epidiolex approved.

In summary, GWPH represents a likely TLRY-Sandoz competitor in certain groups of patients (seizure disorders and potentially off-label use), but also a competitor that has laid down the pathway to develop and gain approval of cannabis-derived pharmaceuticals. Of course, TLRY needs to continue down the recreational cannabis road given the size of that market. Nonetheless, a phase 3 study of something like Tilray 2:100 would attract a lot of positive attention, as an approved product can be sold at a much higher price point, and as discussed above, some physicians may have a strong preference for something that has been run through rigorous clinical trials.

Final remarks

While I am excited about TLRY’s collaboration with Sandoz Canada, particularly products such as Tilray 2:100 given the studies behind it, I feel that the Sandoz name will only take TLRY so far. Revenues from the medical cannabis space may peak as Canadian patients simply acquire products via the recreational route, and those going via the medical route may end up on competitors’ cannabis products or even approved drugs (Sativex and, potentially, Epidiolex). As other pharma players like Johnson & Johnson (NYSE:JNJ) and Apotex seem to be interested in entering, or have entered, the medical cannabis space, the market share held by TLRY-Sandoz can easily be divided. Even if the $600 million market size for 2018 remains in years to come, and TLRY could capture 20 percent of it, would $120 million per year in revenues be worth getting that excited about for a company which already has a $13 billion+ market cap?

Unlike Canopy Growth Corporation (OTC:CGC) or Hexo Corp. (OTCPK:HYYDF), TLRY doesn’t yet have a major collaboration with or investment from a beverage maker. I find the current partnership with Sandoz Canada to be a poor substitute for a large deal with a beverage maker. Meanwhile, TLRY isn’t yet ready to do what GWPH has. Although it could follow in GWPH’s footsteps in the future, the recreational market is likely lower-hanging fruit near term. If TLRY could do something similar what CGC has done in securing a multi-billion dollar investment from Constellation Brands (NYSE:STZ), then it might be possible to get behind a multi-billion dollar market cap. Until that happens, I remain bearish on TLRY at these prices despite my enthusiasm for the company’s medical cannabis products, clear communication and potential to follow in GWPH’s footsteps. Investors would do well to take profits on TLRY at current prices and come back when it is cheaper or has a deal worth getting excited about.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Judge Kavanaugh and the Information Terrorists Trying to Reshape America

Since the advent of Donald Trump’s candidacy, there’s been a ton of focus on botnets and sockpuppets—automated and semiautomated social media accounts that use disinformation to manipulate public opinion.

But the spotlight on bots has overshadowed the importance of the people who often initiate the flood and flow of information, and how the narratives they build over time influence how we see politics, ourselves, and the world around us.

Last month, the attorney of Christine Blasey Ford, the California professor who has accused Supreme Court nominee Brett Kavanaugh of sexual assault at a long-ago high school party, revealed that Blasey Ford and her family were in hiding and had hired private security after Blasey Ford received death threats over email and social media. Among those cheering on the hate-trollers were many familiar faces from the sewers of the modern far-right disinformation metropolis: dandified Republican rogue (and likely Mueller investigee) Roger Stone, his alt-media protégés Mike Cernovich and Jack Posobiec, anarchist turned Kremlin propaganda employee turned Bernie backer turned Trump backer Cassandra Fairbanks, and breathless Infowars conspiracist-in-chief Alex Jones. And not surprisingly, alt-right super-troll and white nationalist fund-raiser Chuck Johnson had his own connection to players in the scandal.

Alex Jones, the right-​wing conspiracy theorist, befo​re his show in Austin, February 17​, 2017.

ILANA PANICH-LINSMAN/Redux

This is an operational unit of information terrorists that is helping to transform the way Americans consume news in the age of Trump—some of the central nodes that give order to the information deluge and around which bot armies and human amplification networks can be organized, wiped out, reconstituted, and armed for attack.

Because that is what they do: attack. Many reporters who cover this phenomenon have themselves been swarmed by attacks and harassment from the digital insurgency that these information terrorists—call them the cadre—command. Information terrorism is not a term I apply lightly. But if you accept the core definition of terrorism as “the unlawful use of violence and intimidation, especially against civilians, in the pursuit of political aims,” then there are few terms more apt to describe what this group has unleashed against their fellow Americans.

The cadre coalesced and sharpened its edge starting in 2014 with Gamergate before throwing in with then-candidate Trump. It has promoted toxic conspiracies like Pizzagate and QAnon, and was ever-present around around movements from Unite the Right to #releasethememo.

This same information architecture was used to attack Blasey Ford and exonerate Kavanaugh. The attacks on Blasey Ford aimed to discredit and silence her using the same tactics that have been deployed to discredit and silence others over the past few years. As others have come forward to accuse Kavanaugh of wrongdoing—including Deborah Ramirez and Julie Swetnick—they have been similarly harassed and smeared by the same machinery and themes.

Some call this trolling, but that term is far too mild. These are not the proverbial hoodied losers in some basement, engaging with other humans only via videogames and 8chan. This cadre has hundreds of thousands of followers and devotees on Twitter, Instagram, Gab, and other social media, many of whom will post and amplify their views even after the personalities themselves are kicked off the platforms for threats and rules violations. The network also takes advantage of affiliations with increasingly mainstream partisan media outlets that will subscribe to any argument that suits their current agenda.

Ultimately, the followers—who are real people, not bots—are cultivated and activated: They don’t need be told to threaten or harass whoever the new enemy is because they already know their part in the play.

Even leaving last year’s Unite the Right white supremacist rally in Charlottesville, Virginia, aside, the conspiracies and toxic narrative this network promotes have inspired a number of armed and violent attacks and dangerous incidents. The feedback within this network is a form of radicalization and extremism. It may seem organized around older conservative themes—belief that “political correctness” has gone too far, straightforward dislike of the Clintons—but it has become a culture of digital violence that is bleeding into real life. The story of how this network emerged and evolved is as byzantine as any fever-dream conspiracy. Unfortunately, it is all too real.

Gamergate

The cadre that now orbits around its central figure, Roger Stone—with its many affiliates, guest stars, and hangers-on—was among the earliest and most ardent defenders of Donald Trump as the man who would upend “the establishment.” They embraced the Stone playbook of doing whatever it took to achieve a goal, of politics as “performance art” and seeing themselves as a new kind of mercenary or insurgent in a hopelessly corrupt and broken system. What Stone called “30 years of bipartisan treason and failure.”

Roger Stone, author of The Making of the President 2016, discusses the election, politics, and the Trump administration, in Longwood, Florida.

Christopher Casler/Alamy

Some of the younger, outsized personalities that would eventually storm the 2016 GOP Convention in Cleveland on behalf of Trump first garnered attention during the confusing 2014–15 events now known as Gamergate—an internet culture war sparked when a group of women exposed what they saw as inherent misogyny in the production and culture of videogaming and argued for greater inclusivity.

This started as a legitimate debate with valid arguments on both sides: Yes, gaming was a male-dominated scene, and some games did objectify women and violence, but there was also an expanding realm of games that appealed to different interests. This exchange was quickly drowned out by a group of militant gamers who resented this intrusion into their sandbox and set out to prove they were not misogynistic by relentlessly attacking and harassing the women and anyone who supported them. The women were doxxed and threatened in graphic terms with rape and death, and some fled their homes.

Many in the gaming industry were taken aback by the entire incident, and called for expanded inclusivity and offered rewards for information on the anonymous attackers. But on the other side, the less extremist group of gamers arguing that they didn’t want the culture to change was overtaken by fringe narratives of manipulation by the “left media” and echoes from conservative blogs about the dangers of political correctness. Over the year that followed, a group of emergent “men’s rights” commentators, amplified by far-right media, would attract a sizable internet following because of Gamergate.

First among these were the now-marginalized Milo Yiannopoulos, then a writer for Breitbart, and blogger Mike Cernovich. Cernovich latched on early, amplifying the theory of white-male identity politics long developed on his blog and arguing that Gamergate was a critical new front in the culture war. He wrote frequently on the need to expose the assault on the First Amendment and about how women make damaging, false allegations against men to smear them.

Yiannopoulos weighed in with his characteristic contrarian flare, including in articles like “Feminist Bullies Tearing the Video Game Industry Apart” (note the hyperlink is actually “Lying Greedy Promiscuous Feminist Bullies…,” which is the essence of most of the “men’s rights” memes), and led others at Breitbart to write on these themes. Infowars jumped on the Gamergate bandwagon and, as the conspiracy flourished, continued to be a platform for Gamergaters to reach the masses, as did Breitbart.

Both Cernovich and Yiannopoulos encouraged the doxxing of opponents on their social media feeds and in their blogs and articles (and Yiannopoulos doxxed reporters himself). They gained a kind of leadership over the unruly mob, maintained by issuing increasingly outlandish statements about the place of women and the rightful status of men. Chuck Johnson would also weigh in in favor of the Gamergaters, learning from the event and realizing that it was a chance to take his marginal brand mainstream. He would go on to amplify Yiannopoulos on “the myth of tech misogyny” and Cernovich on themes like false rape allegations.

All this made clear that Gamergate wasn’t really about gaming or even women—it was about identity, a bunker mentality that Trump would mobilize during his march to the presidency. Many long, thoughtful analyses of the road from Gamergate to Trump have been written. Even a Breitbart contributor would later ponder whether “leftists” weren’t right that Gamergate led to the Trump presidency.

The themes of censorship, false accusations, oppressed maleness, and resurgent masculinity were tempered in the fire of Gamergate, and they would gain amplification in the years to come. Gamergate was loud and controversial, and it was a magnet for other internet fringe elements, including white nationalists, anti-feminists, neo-Nazis, and dude-bros who use terms like “shit-posting” as a compliment.

But there’s another aspect to this that is critical: In terms of information architecture, Gamergate was a signal event—a rally-point for the charlatans and hucksters who would become leaders because they could put words to a previously poorly defined sentiment that was more widespread than anyone wanted to think.

Cleveland, Wikileaks, Seth Rich, and the Trump Candidacy

Yiannopoulos was banned from Twitter in July 2016 (as Chuck Johnson had been in May 2015) after directing racist hate-trolling against an actress, which finally seemed to trigger whatever Twitter rules hadn’t applied to his previous transgressions. His celebrity had just reached its peak, and he swaggered into the Cleveland GOP Convention surrounded in controversy and continually reassuring people he wasn’t a white nationalist. He wore his twitter exile as a badge of honor.

Milo Yiannopoulos, right-wing ​provocateur and former Breitba​rt editor, speaks at A Night f​or Freedom, hosted by Mike Cer​novich and Stefan Molyneux, in​ Washington D.C. on February 2​4, 2018.

Mark Peterson/Redux

And with this, the Gamergaters shifted into presidential campaign mode. In the months leading up to Cleveland, Yiannopoulos andCernovich had found common purpose with Roger Stone on the targeted bashing of Ted Cruz, including amplifying a “sex scandal” fromfavored Trump outlet the National Enquirer.

The America First Unity Rally, which wassponsored by Infowars and cohosted by Roger Stone, would bring together many of the fringe groups that were becoming more mainstream behind candidate Trump.Jones,Yiannopoulos, andStone would all speak to the crowd, promoting the idea of “radicals” taking the reins of the party.

During and after Cleveland, it was becoming clear that Stone appreciated the Gamergaters—along with Johnson, with whom he has repeatedly publicly feuded—as younger, if equally dapper and outlandish, devotees of his shady political and propaganda tactics. They were willing to cross lines, break rules, harass and intimidate opponents, spread lies, and revel in the the fact that they were reviled by the Republican establishment as trolls, freaks, and con artists—as Stone himself had become in championing Trump against the GOP establishment.

This made them a critical tactical force in Cleveland, where they collectively bullied, attacked, and intimidated anyone who wasn’t a fervid enough supporter of Donald Trump. Stone threatened to punish delegates who wouldn’t vote for Trump. Johnson stalked the female reporter who had accused Trump campaign manager Corey Lewandowski of physically assaulting her, with Cernovich filming the incident. Yiannopoulos leveraged his celebrity brand—labeled “gay neo-fascist” by one reporter—into high-profile parties that brought the fringes supporting Trump together, amplifying the discomfort many in the establishment GOP felt for this movement.

New names popped up in Cleveland that would become important to the insurgency. Neo-Nazis and “white nationalists” that would become better known later on because of Charlottesville—Richard Spencer, Ricky Vaughn, Tim “Baked Alaska” Gionet, Andrew “Weev” Auernheimer—would congeal near the core cadre in Cleveland. The anonymous pro-Trump bot-king “MicroChip” hadhelped amplify Stone’s message of the “#clevelandsteal” before the convention; at the convention, GOP delegates were intimidated via twitter, including by Vaughn, whotargeted threats of violence to certain delegates.

Online and on the ground, the atmosphere built by the core group and these new affiliates felt wild, dangerous, and out of control. It was the perfect counterpart to the fear that people closer to the Trump campaign had built up over the previous months—that if Trump was not given the GOP nomination, there would be violence.

Also debuting at Cleveland were memetic warfare advocate Jack Posobiec and Cassandra Fairbanks, a shape-shifting activist. In 2013, Fairbanks was an Occupy movement/anti-rape activist. In 2015, she spent months in Ferguson with Black Lives Matters. Her anti-police anarchist attitudes gained her the attention of Russian propaganda outlet Sputnik, for which she became a writer in 2015. At the time, she was a fan of Bernie Sanders and engaged with his campaign. A year later, just before Cleveland, she threw in with Trump, using her platform to convince other Bernie supporters to come with her. (And as the Mueller indictments would later detail, tapping into the leftist anti-establishment sentiment backing Sanders was a pillar of the 2016 Kremlin disinformation campaigns). In short, Fairbanks was the perfect “horseshoe”—using her anarchist political views to bridge left and right anti-government sentiments and, in this case, align them behind Trump.

Collectively, this group dominated the media surrounding the GOP convention with their outrageous statements and intimidation tactics. It was the grotesque slow-motion train wreck no one could pull their eyes from—in particular when they realized it was no longer the sideshow, but indicative of the main event, with Trump as ringmaster. This was no longer your father’s GOP.


As Cleveland took down police barricades and Republicans slumped homeward, the Stone cadre was full steam ahead, pivoting smoothly into promoting Wikileaks’ hacked DNC materials before the Democratic convention (material which was, of course, provided to Wikileaks by Kremlin hackers).

Stone would, by all appearances, become a focus for the Mueller investigation for his alleged contacts with Wikileaks and Guccifer 2.0. They all played a central role in amplifying Wikileaks, along with the parallel conspiracy theory that the DNC hack was actually a leak from murdered DNC staffer Seth Rich (a conspiracy reportedly amplified by Kremlin disinformation networks). Fairbanks wrote an article to fuel the conspiracy and was a leading driver of it. Johnson, working with Cernovich and Wikileaks, offered a bounty for information supporting the conspiracy in 2016. A year later, Yiannopoulos was still promoting this conspiracy.

But the work on this complex hacking/emails narrative wasn’t done. And hey—why not start some new ones about child sex trafficking while you’re at it?

In September 2016, Johnson claims he helped the teenage girl sexting with disgraced former congressman Anthony Weiner, husband of Clinton staffer Huma Abedin, sell her story to the media. The girl would later explain she had baited Weiner into the online relationship to see what he would do. The story published in the wake of Johnson’s efforts (and, he claims, amplified by his “troll army”) became the pretext for the FBI’s access to Weiner’s computer—an event that famously impacted the Clinton campaign in the final months, especially when FBI Director James Comey opened, and then closed again, the investigation into the “missing” emails.

Johnson had other irons in the fire as well. The day before the sexting story came out, Johnson published an article claiming he had obtained information from a “Soros-tied PR firm” that was launching a website, PutinTrump.org, supposedly to “spread conspiracy theories about Donald Trump’s connections to Russia.” Shortly after the story was posted, Wikileaks tweeted out the link to the website, which was still password-protected, along with the password itself. Johnson wrote about this in triumph, telling Wikileaks: “We can take down Hillary together.” (Later, in August 2017, Johnson would arrange a meeting for Putin-loving Republican Congressman Dana Rohrabacher with Wikileaks founder Julian Assange in London—which Johnson would also attend, and then refuse to tell Senate investigators about.)

At the same time, Johnson was supposedly helping GOP operative Peter Smith make contact with hackers who might have the “missing” Clinton emails.


In the summer of 2016, there was a lot going on, and these events have been interpreted in wildly divergent ways. But a central group of actors was fueling conspiracies to attack Trump’s opponent, and these were amplified by Kremlin-backed information operations targeting America.

There’s one more critical element to attribute to the toxic disinformation brigade: the stories Johnson helped spin on Weiner were in turn the origin of the fabricated nonsense that the Democrats were running a child sex trafficking ring—a narrative that has become the central axis around which another far-right conspiracy now orbits.

Pizzagate and QAnon

In October 2016, an online conspiracy that would become known as Pizzagate was started by a fake account, alleging that emails discovered on the Weiner laptop seized by the NYPD contained proof of a (potentially occult) child sex trafficking ring run by prominent Democrats like John Podesta and Hillary Clinton.

Kori and Danielle Hayes at a Pizzagate demonstration, outside the White House in Washington, DC on March 25, 2017.

The Washington Post/Getty Images

This lunacy of alleged secret code embedded in various food words—pizza, pasta, cheese—and communicated via secret calls to a DC pizza parlor escaped from the rumor/conspiracy peat bog and gained real attention when it was heavily promoted by Infowars and other right-wing disinformation sites like True Pundit; by Stone himself, plus Cernovich and Posobiec; by Fairbanks; and by a healthy array of foreign-hosted botnets. (Rolling Stone took the trouble to lay all this out in incredible detail.)

Posobiec was one of the biggest drivers of Pizzagate on social media, and his name will forever be synonymous with it. Johnson’s alt-right/white nationalist fund-raising site offered a bounty for anyone who could find proof of the conspiracy.

That one anonymous tweet about Weiner’s laptop culminated six weeks later in an armed attack by a Pizzagate believer who, inspired by an Infowars video, drove from North Carolina to DC with an assault rifle to raid the pizza parlor and free all the trafficking victims he was expecting to find. Shots were fired, but no one was injured. Suddenly, this fevered online circus was very real—in an immediate and dangerous way.

The Pizzagate promoters worked to distance themselves from the conspiracy. Even Alex Jones briefly realized he had crossed a line with this one, posting an apology for pushing the Pizzagate story on Infowars.

The problem was—his followers believed it. Pizzagate believers rallied at the White House after Jones renounced the conspiracy. The Pizzagate apology disappeared from the Infowars site, and Jones went right on into the next iteration of this elaborate contrivance—QAnon—hosting the exact same set of Stone-related characters to talk about it on his show.


Everything about the Pizzagate conspiracy theory was debunked. But if the pizza parlor raid was a dud, the sex trafficking conspiracy didn’t die; it was first relabeled in memes and murky chatrooms as “pedogate” and then found a new outlet as QAnon—a complex and addictive conspiracy that soon burst into mainstream consciousness.

QAnon takes the prepared ground of sex trafficking mania and links it to the need to prove that Mueller’s Russia investigation isn’t real. It argues—and I’m abbreviating this tremendously—that President Trump is saving the world from a vast Soros/Clinton/Podesta child sex trafficking ring; that attorney general Jeff Sessions has prepared tens of thousands of sealed indictments to arrest all those connected to the sex-trafficking ring; that the mass arrest is coming any day now, when people will be rounded up in the abandoned Walmarts or maybe GITMO or whatever; and that Mueller is in on it, because the Russia investigation is just cover for the investigation of the sex traffickers.

I really wish I was kidding—but alas. Way before Q went mainstream, I had a black car driver in Texas explain to me that he had already heard Trump’s pre-recorded secret address from the Oval Office, which would be aired when the mass arrests—of 18,000, 40,000, who can say how far it goes?—took place, which would be soon. He calmly, rationally, and politely insisted that Q “explained everything.”

In 2014, Chuck Johnson explained in a Mother Jones interview how he offered “bounties” to independent online researchers to solve “puzzles” that he gave them. What he said is actually a good description of why QAnon works: “You get all these hobbyists and amateurs and people out there who have a lot of time on their hands, many of whom are retired or they’re a mother, their kids are sleeping while they’re researching, they’re stay-at-home moms, or they’re college students or they’re unemployed or this is their moonlighting thing. All those people are starting to find one another.” It’s that sense of being a part of a bigger mission.

A man holds a large “Q” sign while waiting in line on to see President Donald Trump at his rally on August 2, 2018, in Wilkes Barre, Pennsylvania.

Rick Loomis/Getty Images

The way I wrote it, it’s easy to dismiss QAnon. Except that it was only nine months from its launch date (October 28, 2017) until people were so deeply entrenched in their belief of Q that they were caravaning to Trump rallies. Except celebrities promote Q. Except that less than a month after it was launched, President Trump promoted an account that supported the QAnon theory that replied to him on his Twitter feed. Except that Trump has hosted one of its promoters in the Oval Office and praised and defended celebrities who champion Q.

And the frenzy builds and builds.


So QAnon had fertile ground to seed. It had been a year since Pizzagate, but the anti-Clinton, anti-Podesta “THE EMAILS —> secret child sex trafficking” narrative had never died down in far-right blogs and “news,” including among the Stone cadre. Before the launch of QAnon for example, on August 5, 2017, Stone tweeted: “Gen Flynn has a list of high level pedophiles, the release of which will decimate the Deep State dons”—a tweet that was later reposted as proof that Trump “knows everything” by the same QAnon account the president retweeted.

By January, QAnon was regular fare for Infowars, where conservative writer Jerome Corsi was a frequent QAnon explainer, having started linking everything to Q in December 2017. (Corsi has now been subpoenaed by Mueller apparently as part of his investigation into Roger Stone.)

While Stone hawked QAnon, others in the group were more cautious after being burned by Pizzagate. Cernovich may have been capitalizing on the moral panic stoked by Q-fever when he targeted a Hollywood director, but both he and Posobiec claimed they weren’t believers in the conspiracy. Still, they would engage in individual parts of the vast plot. Both Cernovich and Posobiec were drivers of another pet theory of Q conspiracists, the #ReleaseTheMemo campaign—as was Fairbanks, even though she was otherwise outspoken in her dislike for Q followers’ fervor.

It was a fine line to walk. And even before Q was visible at Trump rallies and the media was writing about it, there was a disturbance in the Q-force. In May 2018, Infowars and the others in the Stone cadre started urgently denouncing QAnon, saying it had been “hijacked” by a deep-state information campaign or maybe just by people out to make a buck. For most of the summer, Posobiec teased that he would explain the whole deal.

In September, his opus supposedly debunking QAnon debuted, outing MicroChip, the aforementioned bot-king, and someone named Dreamcatcher as the creators of QAnon. According to Micro (if any of this is to be believed), they basically just created a word salad out of the stuff Trump supporters believed—the sex trafficking mania, Clinton is about to be arrested, the Generals, Russia’s not a thing, Trump is the savior—and made a list of questions that would tantalize that audience and engage them online.

“It was meant to be funny, to get people’s imaginations going,” Micro said in his interview with Posobiec. “It’s not supposed to go this far.” He said they only wrote a few of the original posts, essentially to bring disparate factions of the Trump movement together, and then someone else took it over.

Whatever its provenance, the conspiracy took on a dark life of its own. On June 15, an armed Nevada man and apparent QAnon follower blocked traffic on a bridge near the Hoover Dam using a homemade armored vehicle, demanding the release of the “OIG report”—a reference to a QAnon theory that there’s a secret, unreleased part of the Office of the Inspector General report on former FBI director Comey and the 2016 elections.

This resulted in a stand-off with police; he now faces a terrorism charge. An Arizona man with ties to QAnon was arrested on July 22 after a weeks-long argument with police over a homeless camp that he believed to be the site of the secret child sex trafficking camp. He still faces assault charges from a prior arrest and faces others, including trespassing, for the latest.

According to a video he once posted, the veterans’ group he is a part of once showed up with AR-15s and stood overlooking a highway. In August, a reported QAnon buff in California was arrested for starting the Holy Fire, a wildfire that scorched 23,000 acres of California’s Cleveland National Forest. He faces charges of arson and felony threat to terrorize. A group was also indicted in Illinois for various crimes, including federal civil rights and hate crimes violations for a bomb plot; the group’s name was an apparent reference to part of the QAnon conspiracy.

A man monitors the fire from a ridge as the Holy Fire approaches the McVicker Canyon neighborhood, which is under mandatory evacuation in Lake Elsinore Wednesday, August 8, 2018.

Allen J. Schaben/Getty Images

All of this to say: Q got out of control, and this fervor began to manifest in domestic terrorism and conflicts with law enforcement. No one wants to own that.


As with the previous toxic conspiracies, once they started sparking potentially violent events, their promoters pretended that they had always had their doubts. They had done the same on Charlottesville, when suddenly they all distanced themselves from the neo-Nazis they had befriended, partied with, and promoted in Cleveland.

And, as before, even as they denounced the conspiracy they kept a door open and prepared for the next iteration. “There is something going on with Trump,” Micro said as he debunked Q, implying there was a different secret conspiracy behind Trump just waiting to be discovered. “QAnon is not going to save you. You have to get out and vote, and do activism.” As I said—how convenient, just before the midterms where Republican voter turnout is in question.

Posobiec may now be ironically outraged that others are monetizing conspiracies. But he knows the drill too: “Perhaps [the format Q used] can be the starting off point for a new series of riddles and puzzles and a new type of information system.” A new type of information system that is essentially mindfuckery.

Reddit has recently banned a central QAnon forum for inciting violence, as they had done previously with a Pizzagate forum. The cycle repeats. But the audience is waiting.

The Kavanaugh Accusations

Once information architecture is in place, it’s like pipes. You just inject new material into the system, and it gets where it needs to go faster and faster as people get used to receiving narratives and themes in a certain context from certain sources. On the far-right, in particular, there has been a concerted effort to recruit people to participate in this process. They act as human amplifiers, both organic and automated, within these narrative structures. (I outlined an example of this here; it irritated this network so much, there are two “Q cards” that reference that piece).

This process of unleashing conspiracies is not just an online activity. This is about behavioral change. And often, in the case of the far-right, about different forms of radicalization.

This architecture has a preternatural advantage, of sorts: It has always been backed by hackers and coders—participants like MicroChip, who understand how to use algorithms and automation. As a result, a small number of important actors can drive the system as long as they have the right content to distribute—content that triggers the right emotional response.

Through each iteration of this network, rape has been a constant theme. Rape and pedophilia are potent triggers that elicit an intense emotional response from an audience. Rape has been used to fling charges of hypocrisy—almost always involving accusations against Bill Clinton or other Democrats. It has been used to highlight examples of “fake news” by pointing to the few cases where the media has promoted unsubstantiated rape allegations. It has been used in attempts to prove elite corruption by insisting that there is a secret cabal of elites who are pedophiles and predators. It has been used to normalize racism—referring to blacks and Muslims as serial rapists and to migrants as rapists and killers. And it has been used to justify misogyny by arguing that rape is “misunderstood.”

Cernovich’s manicured persona has always had an edgy and loathsome sexual aspect, studded with macho proclamations about dominance, violence, and rape—the boy-fantasy version of 50 Shades of Grey. There’s a lot of talk, as his Gamergate wingman Yiannopoulos used to say, of rape culture being a “fantasy”.”

Johnson had previously published a blog post targeting a rape accuser, only it was the wrong person, and has suggested that women who stay silent haven’t really been raped. Rape isn’t a myth for them, though, if you are a Democrat or in particular if you are BillClinton or maybe Senator Chuck Schumer. Stone helped deflect a series of assault allegations made against candidate Trump by bringing all of Clinton’s accusers to a debate.

This has all taken on a new heady energy as pushback to #MeToo—and riding the coattails of the conspiracy bandwagon. But the intent is the same: to demonize the opponent, define identity, activate the base around emotional rather than rational concepts, and build a narrative that can be used to normalize marginal and radical political views. It is, after all, very convenient to have a narrative positing that all your political opponents are part of a secret cabal of sexual predators, which thus exonerates your side by default.


This is the ideological landscape that has been so swiftly leveraged in the defense of Brett Kavanaugh.

The cadre and their followers knew exactly what to do when the allegations made against Kavanaugh by Christine Blasey Ford became public. They did not disappoint. Rapid efforts by far-right blogs and personalities to dox and troll Blasey Ford resulted in the targeting of the wrong Christine Blasey Ford; Posobiec was one of those reportedly amping this misguided doxxing. Cernovich said Blasey Ford was a “far left wing activist” who had been “scrubbing” her social media profile, so her accusations were “activism.” Alex Jones made a joke of the whole thing, with Infowars saying Blasey Ford is a “leftist” whose accusations were a “political ploy.” Fairbanks: “She can’t prove it… Her clothes were on… Fuck that lady.” That’s a particularly strong comment from a one-time anti-rape activist. Stone: “This is a woman looking for her Anita Hill moment.”

But this was pretty typical fare for this group. And then, in an interview discussing the allegations, Roger Stone cited Mark Judge’s denial of Blasey Ford’s account. Judge, it turns out, has a long history of interaction with this core network.

Perhaps not surprisingly, Judge deleted his Twitter and YouTube accounts soon after the Blasey Ford accusations were made public. (Johnson also deleted his entire news site.) Judge’s writings about high school drunkenness and sexuality and his experience getting paid to take pictures of women in bikinis have been duly noted, as has a yearbook quote that references hitting women. But Judge was a prolific writer on a range of conservative “culture warrior” causes, including for The American Spectator, CNSNews.com, The Daily Caller, Acculturated, and Splice Today, among other blogs and publications. Much of it fits right in to the Cernovichian advocacy of “men’s rights.”

Judge has weighed in on just about everything: holding forth about the need to “make Playboy great again” (masculinity), advising women on “graciously turning a man down” (toxic feminism), and expounding on how Melania Trump is an archetype feminine woman raised outside the “leftist orthodoxy.” He has quibbled over the definition of sexual misconduct by asking whether Wonder Woman was raped, and, on Acculturated, explored other “double standards” applied to what he sees as the increased liberation of women causing the oppression and depression of men. And don’t forget about the need for unrestrained “male passion.” Plus, you know, young women in bathing suits.

Judge discussed Hollywood liberals and child rape jokes with Cernovich (Hollywood/pedophilia is a topic he frequently returns to). He wrote a piece on Gamergate linking to Yiannopoulos and calling media critic Anita Sarkeesian a “social justice warrior.” He authored a positive review of alt-right backer David Horowitz’s book. (Horowitz is known for his views that the real race war is being waged against white people and that the coverage of Charlottesville was “fake news.”)

In short, Judge was a generator of content for the alt-right machine, using his high school bad-boy, “real man” credentials as a springboard to comment on the whole suite of social issues that the alt-right feels is eating away at our Americanness.

This is the information that flowed through the architecture the Stone cadre popularized and mainstreamed over the past few years, moving it from the fringe to a central pillar of the conservative agenda, cartoonifying legitimate issues of conservative concern and recruiting new supporters as they went. The narrative was set long ago—allegations are false, men (especially white men) are oppressed, the people who stand against you are corrupt perverts worthy of demonization, and everything that is the America you know will fall apart if you don’t fight for some notion of the way things were and should be again. And the best way to achieve this, since the system will fight back, is viciousness.

This architecture is established, and permanently in transmit mode.


Players like Judge may seem marginal to us—but their role in building these networks is important when suddenly the worlds they come from are involved in events like the accusations Blasey Ford has leveled in the midst of a Supreme Court confirmation battle.

Consider the now-infamous and disavowed (but archived here) Ed Whelan twitter thread, an odd diversionary narrative hyped as an alternate theory of the night Blasey Ford describes. Its gist: mistaken identity of the perpetrator. Potential defamation issues aside, it seemed to build on the groundwork being laid by Senate Republicans and the White House to carefully insinuate that Blasey Ford wasn’t lying, merely mistaken about who attacked her. But Whelan transformed it into a bonkers Twitterverse conspiracy theory about the bedroom at the top of the stairs.

An analysis of the accounts that retweeted Whelan’s teaser for his conspiracy most frequently post content from right and far-right media, several of which are anchors in the far-right disinformation ecosphere (and Russian disinformation, to boot).

Posted for less than 24 hours, Whelan’s mistaken-identity theory sparked a wave of blog posts and discussions on far-right sites that live on even after Whelan backed off. This post, for example, repeats Whelan’s claims and suggests they all but vindicate Kavanaugh. It was a top-trending piece on disinformation trackers and was still being circulated on Twitter days after the source was deleted. And so was this one, this one, and this one. Some 1.5 million “Fox and Friends” viewers heard all about the mistaken-identity theory live on TV. Once it’s out there, you can’t pull it back.

Whelan only did what the Stone cadre has done for years: push a lie, entrench it, later disavow, thus minimizing the damage all while presumably knowing that it’s still there, colonizing the target population. Whelan’s conspiracy plugged into the narrative architecture that had been refined since Gamergate. They know these themes and narratives, and the “evidence” scratched the conspiracy brain, seeming like plausible open-source intelligence. It achieved exactly what it was intended to.

The narratives to defend Kavanaugh were mostly about discrediting Blasey Ford: that she was part of a secret CIA mind-control project (the CIA connection was also alluded to by Kremlin disinformation purveyors); that George Soros was behind her allegations; that her lawyer was linked to Hillary Clinton; that she was motivated by profit; that she did this as revenge for a foreclosure case where Kavanaugh’s mother, also a judge, ruled against Blasey Fords’s parents (only, she didn’t—she ruled in their favor); that she had also made false allegations against Neil Gorsuch; and many more.

What was the payoff for this multifront conspiracy defense? Well, Blasey Ford was asked questions that hinted at some of these conspiracies during her testimony before the Senate Judiciary committee—who was paying her bills and pulling her strings?—by the prosecutor representing the Republicans. Presumably those questions came from members of the committee.

And then, when it was his turn to testify, Kavanaugh himself deployed this narrative by referencing and implying conspiracies in his red-faced attacks on the Democratic members of the Senate Judiciary Committee. While he would not say directly that Blasey Ford was lying, he alleged the left was “willing to do anything … to blow me up,” including “false last-minute smears” “calculated and orchestrated” against him as “revenge on behalf of the Clintons.”

In the course of his angry self-defense, Kavanaugh stamped a lot of bingo squares: attempted rape allegations as a political tool, false allegations, Clinton, secret conspiracies. By going out and taking the big swing, he elicited a powerful emotional response in his defense—an activated response from a hardened base. #ConfirmKavanaugh was trending—with support of far-right and Russian-linked accounts—after the hearing.

What’s Next

The chasmic problem facing us all: Radicalization is relatively simple to accomplish using social networks and other media, but de-radicalization is not. Pizzagate believers still believe. The people pushing Q disavowed it months ago—and only after that did it crest in the public imagination.

As Micro said in his confession: Things weren’t supposed to get so out of control. But this is the system the cadre built—a network hungry for the next hit of disinformation to inflame confirmation bias, moving content so swiftly that stories can jump from rando twitter to MSM in 12 hours flat. The landscape is prepared. The participants know what to do.

When it comes to the psychology that shapes mass movements, there are two fundamental rules: Everybody wants to be a part of something bigger than themselves, and everybody wants someone to tell them what to do so that things will turn out OK. With that in mind, our understanding of what conspiracy theories are and why they work comes into focus. Conspiracy theories aren’t something that stupid or uneducated people fall for—they are something that people who want to believe in something latch on to.

Maybe it’s religion, family, national identity, ethnic identity, community, or government that used to be this structure—the system of belief, the answers to who you are and where you fit within the system. But when those break down, conspiracies can take their place, particularly in times of rapid change or upheaval. They become the framework for making things that don’t make any sense somehow understandable.


As Kavanaugh was holed up in the White House undergoing intensive prep to combat the accusations, Blasey Ford was off the grid, moving from house to house with a newly employed security detail, terrified by death threats, swarmed and disparaged by trolls and digital attackers whose smears and conspiracies then bleed over into the blogs and then into more acceptable conservative media. So prepared is this landscape for new conspiracies of central bogeymen—crisis actors, pedophiles, Soros, secret CIA plots, and more—that naked absurdities are liked and reposted without much thought.

Gamergate became Pizzagate became QAnon became entrenched modern narrative architecture ripe for exploitation. The cadre mobilized a movement of misogyny and white nationalism and intimidation—of angry boys who reveled in the chaos god of Roger Stone—and cultivated the narrative to make it acceptable to a wider lane of conservatives. This is triggering violence and identifiable forms of extremism that we can no longer ignore.

This is Donald Trump’s America. But more, it is Roger Stone’s America. Whatever it takes to win is fair game, even if they burn down the minds of Americans in the process. This willful radicalization is a campaign of information terror waged on fellow countrymen—the necessary domestic counterpart for hostile nation-state information warfare to be successful. It seems no accident that Stone is apparently in Mueller’s sights, possibly for behavior that suggests coordination with Kremlin-linked actors.

The leading lights in Stone’s orbit take scalps and champion memes, only to shed their skins and awake in a new persona, turning their flamethrowers from one topic or group to the next. In a non-Trumpian America, they might have remained the fringe provocateurs they are, trolling the fact-based world for exposure and ad revenue, vitamin hucksters and doomsday preppers masquerading as political commentators.

But as the Trump Train prepared to leave the station, the conservative media was already so thoroughly riddled with conspiracists and storytellers that the fringe had ample bridges to the much-maligned MSM. To name a few: Sean Hannity and his commentators (John Solomon, Dan Bongino, Sara Carter); Tucker Carlson and his Daily Caller, where Johnson and Judge contributed; Breitbart, which helped integrate conspiracy and propaganda like Infowars and Gateway Pundit.

And, of course, the president himself has amplified conspiracy and demonized “the media”—even while elevating a new ecosystem of far-right media groups and personalities, like One America News’ Posobiec and whatever TruNews is. This has transformed the way conservative Americans consume information, altering how they make judgments on truth and reality.

Blasey Ford has learned how devastating this runaway narrative architecture can be. But so, now, has Kavanaugh, whose personal credibility was also being run down by the propaganda being levied in his defense. Maybe, just maybe, it was a Hail Mary that worked out for him, in the end. Certainly, it has helped inflate a sense of urgency to vote on his nomination and to make it more intensely partisan. Or, as Posobiec added at the close of the hearing, “Confirming Kavanaugh to own the libs.”

As with Gamergate and Pizzagate and QAnon, the information weapons being fired in the Kavanaugh controversy are uncontrollable and adaptive. We are beginning to see the cost of this—but now the question is: Who will pay?

It is clear that foreign powers seeking to manipulate Americans with these asymmetric tools of information warfare must pay a price for doing so. But what about domestic forces that use the same tools and tactics? How do we judge those who apply disinformation against their fellow citizens to improve their odds, seeking to benefit from the ability of this architecture to spark frenzy and fear, intimidation and violence? What price should they pay for the scorched earth they leave behind?

Cognitive warfare is a dark, seductive rabbit hole. It is powerful and unregulated, and right now, thanks to social media in particular, the information domain is as lawless as the wild west, as demoralizing as the terror of World War I trench warfare, and as adaptive as the guerrilla tactics in the Philippines in World War II. There are state actors, nonstate actors, private sector and other independents—armies, mercenaries, and terrorists, all looking to master these techniques. Even small groups, like the cadre I described here, can achieve significant outcomes when the network effects kick in.

Trained and untrained operators alike are beta-testing tools and tactics on human minds, deliberately or intuitively. Information weapons are intangible. But people aim them, and people are the target. It’s time we take them seriously. The immediate costs are already visible in America. The long-term costs will be devastating. One need only look to Stalin’s campaigns of internal psychological terror waged in captive nations to understand the price can be inconceivably high.

And we’re all paying the price already, whether we know it or not.


Molly K. McKew (@MollyMcKew) is an expert on information warfare and the narrative architect at New Media Frontier. She advised Georgian president Mikheil Saakashvili’s government from 2009 to 2013 and former Moldovan prime minister Vlad Filat in 2014–15. Open source researcher Jay McKenzie (@JamesFourM) helped conduct the research for this analysis.


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