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Laura Black and Christian Davis of the lawfirm Akin Gump discuss the likelihood and implications of an outbound investment regulation regime to protect US national security interests that would screen and monitor outbound investment from the United States to “countries of concern”.  You can check out recent thought leadership published by the firm here as well as information on how to get in touch.

In this episode, host Bidemi Ologunde discussed how geopolitics is intersecting with popular culture and national security, as seen in the ongoing issues with TikTok.

Timestamps
Part 1: "The Committee on Foreign Investment in the U.S." (2:06)
Part 2: "An escalating tit-for-tat of tech protectionism." (8:49)
Part 3: "Embroidery." (17:46)

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0:00 -- Intro.

1:42 -- Start of interview.

3:31 -- Mario's "origin story". 

9:25 -- The origin, evolution and impact of CFIUS. "The (regulatory) process is the bottle, national security is the wine." The driver of CFIUS is national security.

13:11 -- On the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA). 

18:18 -- His recommendation on how boards should think about CFIUS matters.  His book: "A Dealmaker’s Guide to CFIUS: Answers to Common Questions from Boards, Bankers and Investors." 

21:40 -- On the new CFIUS Enforcement Guidelines (Fall 2022). "Since FIRRMA, CFIUS has been significantly resourced by the U.S. Government and today there is an independent office within CFIUS that is entirely focused on transactions that were not notified to the Committee." (see CFIUS annual reports to Congress). There are hundreds of transactions reported per year at this stage.

25:58 -- The proposed outbound investment screening regulatory framework. "[It may impact] a U.S. person sitting in a Chinese board (for example)." "The U.S. has jurisdiction over U.S. capital, U.S. persons, U.S. technology, etc and the U.S. wants to slow down adversary countries." "We will know a lot more about this framework by the end of February 2023 when the report comes out."

29:47 -- On the different approaches to industrial policies by China and the U.S. The Chips and Science Act and IRA Act of 2022.

36:36 -- On how boards should consider geopolitical risks and opportunities ("how to optimize outcomes"): Three questions to consider: 1) The U.S.- China relationship, 2) What the US is doing with its allies / What China is doing with its allies, and 3) What are national governments doing to independently enhance their own sovereignty and security resilience.

39:17 -- On US jurisdiction over U.S. foreign-listed companies. Example of Canada ordering divestment from Chinese investments in Canadian lithium companies.

43:30 -- Final thoughts for directors on geopolitics and national security issues. 

44:24 - The books that have greatly influenced his life: 

1. Moby Dick, by Herman Melville (1851)
2. The Closing of the American Mind, by Allan Bloom (1987)

45:56 - His mentors, and what he learned from them. 

1. Donald Rumsfeld (former U.S. Secretary of Defense)
2. Aviva Diamant (retired, Fried Frank)
3. Norm Augustine (former Chairman and CEO of Lockheed Martin)

48:20 -  Quotes he thinks of often or live his life by. From his mother "This is the day the Lord has made; let us rejoice.” (psalms)

49:05 - An unusual habit or an absurd thing that he loves: early rising and journaling at a coffee shop or diner.

50:06 - The living person he most admires: his dad.

Mario Mancuso is a Partner of Kirkland & Ellis and leads the firm’s international trade and national security practice. A former senior member of the President’s national security team, Mario provides strategic and legal advice to companies, private equity sponsors, and financial institutions operating or investing across international borders.

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 You can follow Mario on social media at:

Twitter: @MancusoOnline

LinkedIn: https://www.linkedin.com/in/mariomancuso/

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 You can follow Evan on social media at:

Twitter: @evanepstein

LinkedIn: https://www.linkedin.com/in/epsteinevan/ 

Substack: https://evanepstein.substack.com/

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Music/Soundtrack (found via Free Music Archive): Seeing The Future by Dexter Britain is licensed under a Attribution-Noncommercial-Share Alike 3.0 United States License

You can follow Evan on social media at:

Twitter: @evanepstein

LinkedIn: https://www.linkedin.com/in/epsteinevan/ 

Substack: https://evanepstein.substack.com/

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You can join as a Patron of the Boardroom Governance Podcast at:

Patreon: patreon.com/BoardroomGovernancePod

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Music/Soundtrack (found via Free Music Archive): Seeing The Future by Dexter Britain is licensed under a Attribution-Noncommercial-Share Alike 3.0 United States License

In this episode:  

• The Onion. An Amicus Brief. The Right to Parody. LegalEagle Video
• The FCC Recommends a ban on TikTok. Finally. 
• Twitter’s Elon Musk is bringing back Vine. And possibly adding a video feature that charges viewers to watch…Hmmmm. 
• Facebook makes it easier for creators. Lauren says it’s a huge change! 
• A disagreement between Josh and Lauren on an NFT Marketplace feature.
• And Uploads & Downloads – Patreon and YouTube Prime Time Channel.  

Check out Jellysmack – Jellysmash.

Also, here’s Spring’s Link. 

We have a YouTube Page!  Please subscribe and follow. (Thank you!) 

Catch a new episode every Friday on your favorite podcasting site. Please subscribe, like, and share! Visit our website www.creatorupload.com. We love hearing from you!   

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1. Intro.
2. (1:40) - Start of interview.
3. (2:34) - Dan's "origin story". He grew up in southern California, did his undergrad at Stanford where he studied international relations. This prompted his quest to do something "cross-border." He did an exchange program in his junior year to Santiago, Chile, where he met his now wife and that planted a seed to do something related to Latin America. After law school he went to London where he practiced with Allen & Overy for 4.5 years. In 2004 he came back to Silicon Valley to practice as a corporate associate at WSGR, where he spent 6 years. At that time, there was not much cross-border work with Latin America, although there were partners focused on China, Israel and India, so the international blueprint was there to start building bridges between Silicon Valley and Latin America. Since then, he has developed his practice (passing through Goodwin Procter and Greenberg Traurig) and now at Gunderson Dettmer where about 80% of his practice is focused on Latin America.
4. (5:53) - Dan's description of Gunderson's Latin America practice: "Fundamentally, we're transactional lawyers that do international cross-border work." Their focus is on venture-backed technology-driven, high growth companies.
5. (10:21) - Why he advises his clients to incorporate in the Cayman Islands. "When we advise clients on a choice of a holding company, it comes down to a mix of investor preferences, tax considerations and administrative aspects." For Latin American companies, there are now three preferred choices: Delaware C-corp, a Cayman Islands company or a UK company. Kaszek Ventures was an early advocate for using a Cayman holding company. "I think we're going to see those 3 structures prevail in the market." Three prominent examples with Cayman holding structures: Nubank (the Brazilian neobank that recently IPOed in the US), Cornershop (a Chilean grocery delivery company that was acquired by Uber) and Kavak (a Mexican used-car online marketplace).
6. (17:26) - On the geopolitical tensions between the US and China, and its implications for the startup ecosystem in Latin America. On the rising investments from China in Latin America and the increasing role and scope of the Committee of Foreign Investment in the US (CFIUS) impacting transactions in the US.
7. (20:39) - On the increasing antitrust pressure from local regulators in Latin America. The example of Cornershop in Mexico and Chile.
8. (23:19) - Dan's overview of entrepreneurship in Latin America. "Brazil is by far the most important market, followed by quite a distant second place from Mexico. Those two markets by themselves dominate the region in terms of capital deployed, number of deals, exits activity, etc." 2021 was a record year for venture activity in the region [$15bn in venture investments]. What's driving this growth? A combination of factors, per Dan: "The pandemic accelerated many changes, all of it boosted by widespread broadband adoption, digitally native people, younger generations, generational shifts in family businesses with decision-makers in their 40s or 30s and a vast under-banked and under-served population." There is also a virtuous cycle with big investors such as Softbank investing in the region ($8bn in two funds focused in Latin America) and other late-stage investors that have increased the cadence and velocity of investments such as Tiger Global. On the corporate governance implications of these investments.
9. (30:22) - On the changing landscape of venture funding  in Latin America: "There is a much richer ecosystem of investors in Latin America, with stronger local investors." The rounds are getting bigger and investments are done at a faster pace. "But the markets will always be cyclical." His take on dual-class shares and other governance structures. "There will be down-rounds or re-caps if we go on down cycles, and these questions may play out in the next decade. We are still in an incipient stage of corporate governance in the region."
10. (39:13) - On SPACs, and how they can impact exit strategies for Latin American companies. "I'm somewhat cautionary and skeptical of this structure, generally." "It doesn't really save that much time, nor much cost." [See Prof. Klausner's latest research on SPACs.]
11. (44:20) - On the role of directors, and diversity on boards. What's the status in Latin America? "It's slowly percolating down in Latin America." "Some of the investors are pushing some ESG standards in their investments, but not so much on gender diversity."
12. (48:28) - On the positive impact in the increase of equity compensation and stock options in Latin American startups ("from top to bottom"). This is a sort of "democracy within the cap table." This is a trend that is starting to become more prevalent in the region.
13. (52:15) - Dan favorite books:
    1. Outliers, by Malcolm Gladwell (2008)
    2. Historical novels and intrigue, such as Red Notice by Bill Browder (2015)
14. (53:27) - Who were your mentors, and what did you learn from them?
    1. Steve Bochner (WSGR)
15. (54:36) - Quotes that he thinks of often, or lives his life by:
    1. "You have brains in your head. You have feet in your shoes. You can steer yourself any direction you choose." Dr. Seuss.
16. (55:41) - An unusual habit that he loves: He likes to collect scorecards from golf courses, he's been doing it since childhood.
17. (57:56) - The living person he most admires: Barack Obama.

Dan Green is a Partner and Co-Chair of the Latin America Practice for Gunderson Dettmer, a prominent international law firm headquartered in Silicon Valley. 

If you like this show, please consider subscribing, leaving a review or sharing this podcast on social media. 

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 You can follow Evan on social media at:

Twitter @evanepstein

LinkedIn https://www.linkedin.com/in/epsteinevan/ 

Substack https://evanepstein.substack.com/

Music/Soundtrack (found via Free Music Archive): Seeing The Future by Dexter Britain is licensed under a Attribution-Noncommercial-Share Alike 3.0 United States License

You can follow Evan on social media at:

Twitter: @evanepstein

LinkedIn: https://www.linkedin.com/in/epsteinevan/ 

Substack: https://evanepstein.substack.com/

__

You can join as a Patron of the Boardroom Governance Podcast at:

Patreon: patreon.com/BoardroomGovernancePod

__

Music/Soundtrack (found via Free Music Archive): Seeing The Future by Dexter Britain is licensed under a Attribution-Noncommercial-Share Alike 3.0 United States License