"press:here" is sponsored in part by barracuda networks cloud connected security and storage solutions that simplify i.t. a san francisco entrepreneur tries to outflank the banking industry. plus a warning about apps that may be more dangerous than you think. and inspiring girls to code. our reporters, "the financial times," and clinton hardy of the "new york times," this week on "press:here." good morning, everyone. i'm scott mcgrew. this is a bottle of salad dressing. i bring it up not because we

have a new sponsor but because it's a great example of a new way to invest. wafu is a rapidly expanding canadian company. you can buy a bottle but also click to invest. if you think the salad days are ahead for wafu they are taking on incredible investors. it's handled by a san francisco company, itself a startup, that works with all kinds of consumer products helping them raise funds. ryan kaldbeck is the circle up founder and ceo. among the companies he's helped little duck organics totally bananas, and bobby sue's nuts. joined by quinton hardy of "the new york times" and anna kuchler of "the financial times" as well. a great number of the companies working with you are food. is there a reason for that that food companies are particularly attracted to this method of raising money? >> it's about 40% of what we do. so we just focus on consumer and

retail companies. that's all we do. and food is about 40%. >> why? >> because we think it's a great place for investors to invest. we think in the technology world, there's overfunding. we think there's a futbol inbubble in technology. >> technology companies go to venture capitalists. very small businesses fund themselves out of their own pockets using their visa card oftentimes. so there's a -- and banks as well. but there's a middle zone there. is that what you're targeting? >> we're targeting consumer and retail companies with typically between $1 million and $10 million in revenue. believe it or not, there's about 1 million companies in the u.s. that fit that criteria in consumer retail with $1 million to $10 million in revenue. historically, the returns to investors in that size range have been very strong. according to the kaufman foundation the average investor in those types of companies makes 3 1/2 times their money in three or four years.

>> what's the failure rate? >> about 40%. a little bit less than tickech. one of the reasons they are stronger is because the failure rate is lower. another reason that the returns are stronger is because it takes less money to help those companies succeed. >> who are your investors? normal people with normal portfolios? do you think who your investors are? >> we definitely understand who they are. >> are they sophisticated people? >> yes. they are family offices and small funds. >> that's a legal term right? you have to have a $200,000 income? remind me what that is. >> a credited investor -- >> remind us. >> a credit investor is an individual that makes $200,000 a year or couple that makes $300,000 or has $1 million in assets. >> some be who can lose the money basically is a good sort of summary. >> that's the way the fcc thinks about it. >> am i right in thinking that you also work with larger consumer goods companies? and why do they need someone like you to make a connection

with a salad dressing company? >> we have formal partnerships general mills, johnson & johnson, proctor and gamble and a number of others. they are interested in the innovation that comes out of this. consumer retail is a very inefficient market. unlike the past, in consumer and retail it's hard for fortune 500 companies to identify the most innovative smaller brands. >> bobby sue's nuts the diamond might be interested in buying them at some point, or general mills might be interested in buying one of the companies? >> they are interested in acquiring innovation through a number of different ways. jv licensing acquisition. last year the mna market in consumer and retail was twice the size as it is in tech. that's how large the consumer and retail companies grow. >> actually get the products that they want they tend to buy it or -- >> they do. if you look at the last 10

years, nestle or coke, you can count how many brands they started on one hand. they buy new brands. >> what are the risks? >> private investing is high risk. you asked about the failure rate earlier, it's high. and to accommodate for that people have to be ok with the long-term hold. typically these companies take 4 1/2 years to earn a payback. many investors can't afford to wait that long. another key consideration is diversification is critical. if you only invest in one or two companies, it's hard to be successful. >> this is not a hey, let's sell this thing to google and get out. this is a slow growth salad dressing. >> no. i disagree strongly. i mean, what i was saying before, the mna market was twice

the size -- >> so we hope that we'll be bought out by. >> you're twice as likely to have it happen. >> that's fantastic. but maying current events the stock market is almost in bear territory now. and that could all go away. so bear in mind that even four-year return might press into a six-year return. >> yes. >> more interesting to me is how much disclosure do you insist on from these companies? are they audited balance sheets? how do you have any way of knowing these things are true? >> we do third party background checks on the entrepreneurs and the companies themselves. in terms of information provided to investors, we provide a diligence packet that includes financials. >> are those audited? >> typically an entrepreneur at that stage is not auditing their books. what we do though is check the numbers against third party databases. the salad dressing you held up earlier, you can look to identify through a third party

the sales of that company last year, and you can compare it versus the competition. we get that data to verify some of them like revenue and give it to the investors to do the same thing. >> anecdotal. >> that's right. >> can you give us an example of what innovation means in this space? we are used to new technologies. is this just new flavors? some of the things on your site have a great potential here but does it have appeal elsewhere? >> i'll give you an example. chibanni which changed the yogurt market here in on its own. it's now a $5 billion company, and yoplait is trying to keep up. that's an example of innovation that people here in silicon

valley would thumb their nose at. but $5 billion later, people are happy about it. >> i can go to the bank and get a loan or have private investors. i'm giving away part of the company if i have private investors. i just have to pay the bank back. >> right. >> why do i give away part of the company when all i could do is just be on the hook to the bank? >> it goes back to your earlier point about some of these companies are slow growing, but they are not. when you're growing 100% a year it's hard to use debt. so in the consumer space, if you're growing that quickly, tomorrow you'll get an order from costco or whole foods. and you need to buy that inventory in advance of getting paid for it. it's hard to have debt and pay down at the debt at the same time you need to buy the inventory. it doesn't work. >> something else how do you make money? >> we make money in a couple of different ways. first, a commission. we are a marketplace. we typically charge about 5%. that number goes down based on the size of the raise. larger raise, we charge less. partnership space. our partners pay us fees to talk to the companies that come up

out of circleup. and those are the two primary ways. we are a technology driven marketplace that connects investors and allows them to invest directly. >> what company do you wish would invest? what do you think is right? as we pointed out, we have seen some of the dog food and the salad dressings. and other ones. there is champagne and things like that. what industry do you think would be benefit well from this sort of model? obviously, not tech. >> no definitely not tech. i think it would be a disaster in the tech world. >> well, tech's got enough money. what industry -- you know if i'm sitting at home and saying i'm in the x industry what industry would you like to see more of this being taken advantage of the jobs act and the sort of -- >> to get in the framework, we know consumer and retail very well. that's all i've ever done. so i know that world. but the framework that leads it to be successful one, i think historically it's shown strong returns. if the industry hasn't shown

strong returns, i'd struggle to believe that investors can be successful in an online site. two, they are understandable businesses. that's critical. this site you're looking at businesses that typically have more than $1 million in revenue. you can find them in their local stores. >> and you understand that. >> you understand that concept. here in silicon valley, you can break down a tech company, but a lot of people around the country don't have the ability to do that. >> thank you for being with us. good luck. >> thank you. up next, dangerous software which spies on you and gives away company secrets? there is unfortunately an app for that when "press:here" continues.

welcome back to "press:here." you'd think an app called whisper might keep your secrets, but the app, which is supposed to be totally anonymous, is not. let's not forget the so-called snap-pening where pictures were exposed to hackers, who exposed them to the rest of the world. ib secure apps are making smartphone users insecure. and corporate america, who knows employees are downloading all kinds of trouble to their corporate phone.

appthority. they track trouble with apps. i want to start with the one i was most astounded by, the little flashlight app. by ihandy. it can access according to your researchers my calendar. >> yeah. >> why is my flashlight app accessing my calendar? >> because they asked, and as users, we granted that access. there's no functional reason why an application like a camera -- sorry, like a flashlight -- >> and the camera too. >> yes, address book calendars location. and really we've seen that developers are trying to monetize. they are harvesting all the information they can to try and place it with data brokers. sometimes for their own internal research, they say let's go ahead and collect it. >> you can't speak for this particular company. you can only say what the data shows you. but you think it is an

intentional thing? you don't think they accidentally accessed my calendar, but rather they are selling it to somebody? >> they have to write software that goes into your phone and looks around for stuff and pulls it out. >> it was free. i will give you that. and so maybe that's why. >> intention is possible. >> and it's something we see that's part of the incentive from developers. they want to monetize, but they also want to give the app for free to get more users. they find that networks and sharing data with third parties are a way to monetize that data. >> do you have any sense of the scale of this problem? >> absolutely. it's something that affects most of the apps out there today. we did a study and looked at the top 400 ios and android apps both free and paid. and on ios and android a free app, 99% of the apps had something to be queasy about. >> 99%? >> and then paid apps it was a little better with 86%. but still -- >> by queasy what do you mean? >> things they wouldn't

disclose? >> they never would have allowed it purchasing software for a laptop or a desktop. access your phone book your calendar. >> why is that good for a business? what kind of information could they lose or who could be spying on them? >> employees are using their smartphones or tablets more and more for work. it used to be just checking emails, but now they are doing presentations, calendars with meeting minutes, attachments, call-in number attendees. >> so something you wouldn't want to be in the hands of your rivals? >> right. >> and work and homer blending into each other. you're planning the soccer schedule for the weekend at work, and working at home. and then it bleeds into the organization really quickly. >> and beyond that too. it becomes a family device not just a personal device. no one would share their desk top with their kid. but at home you give your ipad to your kid so they can play a

game. now that game is sitting next to corporate data. >> even if they don't do it intentionally, in the case of -- there was a london tube map that you showed me there that it's not necessarily harvesting my data per se but whatever data it is using for maybe legitimate reasons, it is sending it back to the developer totally in the clear. >> absolutely. so we found that that app was submitting the last eight weeks' worth of data what time you took the train at which station. >> which might be important for them to know. i'm ok with that. >> or balance on the oyster card. >> i'm ok with that. >> but when it's transmitting it to third parties, it's transmitting to anybody. anybody can know your account number first name, last name, birth date where you're going, where you've been. >> and you triangulate which companies you were visiting. that's valuable. the app business is five or six years old. it's turned into an ethical

sewer. all of the companies are doing it. >> there are some things that are happening. the sign cycle used to be very long. companies like oracle, microsoft, but now from the top 100 apple apps there's 82 developers. the barrier of entry is low. >> 82 developers who all think, you know i really need to steal his calendar data. >> they say, how can i build the app the fastest? so there's mistakes. and the cheapest. are not use are third-party tools. >> you have two big app stores. why are they not doing something about it? >> great question. and what google and apple are struggling with is what's the minimum bar safe enough for consumers. and the conflict with the customers and enterprising government is, well it might be safe enough for someone to use at home but not safe enough for employees. >> but to hannah's point, isn't there something maybe the way we

dotel vision and movies and that is this app will access your calendar, green checkmark, yes, it will. this is what this app will or won't do not where i have to look through, but just some sort of rated sort of system. >> we're starting to see that more and more. there's pressure from the government on both apple and google. google now displays all the permissions. apple monitors the permissions. the problem is what it accesses it doesn't tell you why and what they'll do with it. i think we'll get to what first. you'll see the flashlight app says access my calendar. most people say ok. they don't know that address book will be data mined and folks will be marketed because you shared that. the next step is what's missing. >> there is that idiotic point of -- and i started with snap snapchat of people who download a third-party app to defeat

whatever the first app is trying to do as well. >> it's frustrating but also scary. as a user you might think that the technology is protecting you. but the technology is always as secure as the users on the other end. you don't only have to place your trust in a start up but the users on the other end that will receive it. what will they do with that data now that it's easy to store that data? >> do you know what a good business would be a blocker app that sends it to a safe calendar and a safe address book. >> you work on that. the quinton hardy app. thank you for being with us this morning. "press:here" will be back in just a moment.

welcome back to "press:here." i thought we'd take a moment to talk about what's working with girls and careers. 74% of girls now express interest in stem in schools in part thanks to mentors going to classrooms telling girls about the fun to be had in engineering and programming. case in point, the band of animators who make the pixar films. this is after all what you're seeing is computer science. danielle feinberg her bioonline says she was responsible for among other things the jellyfish in "finding nemo." that impresses the heck out of me. she is now the director of photography for lighting at

pixar and a mentor for made with code. i said 74% of girls are interested in stem in schools. about but it drops amazingly when it comes to the number of girls that end up being computer programmers. why? >> i think there's a lot of messages that girls are getting especially around that time period of time of sort of seventh and eighth grade that girls aren't supposed to be interested in math and science. they are not supposed to code. there's some misperceptions about what you are if you're a coder, which is one of the really cool things that the made with cool website has been doing with mentors so you can see people doing their job so you know it's possible. there's also -- they have profiled teenagers who are doing amazing things with music and robotics and medicine. but also just sort of seeing that it's something that you can do and it's exciting rather than sitting in an office beating away at a computer and doing

boring maybe banking software or something. >> do you think that kind of image of the hack a-thon and stay up all night and hack has been damaging for girls or do they think it's boring or what's the issue? >> i think sometimes those are presented a little more. i think that's more exciting than the idea of sitting in an office by yourself. >> for anybody, for any gender. >> i think there aren't as many women represented there, so it ends up looking like a little bit of a boy's job, so girls have a hard time to picture themselves there. >> you mentioned -- and we have been talking about this problem for a long time now. but typically it was in the context of why can't we make science fun. you know math is fun. but you're saying you really need to model a sense of what you might become who you could be in the world and show them an adult representation of that just to show them it's fun to be an engineer, here's who i am in

the wordld. >> the wonderful thing about tech is you can find what you love and have a career now. i love art and computer programming, and that comes together in this amazing nexus of making animated films at pixar. but, you know, if you like music, and you code one of the girls profiled on made with code, wonder girl she programmed beats and they got sampled by a prominent artist next thing you knew she was at the grammys and she was 19 years old. you can choose fashion or music or all of these things and pair them and have a career now. >> i do think we do -- if you watch the movie "social network" or something, there is this stereotype where computer programming isn't the interesting things that make the world interesting. that the jelly fish in "nemo" is computer code, you know. have you seen kids go, oh, i didn't think of that. >> absolutely. there's no better way to get

kids excited about not only coding but math and science, when you show them the pixar films all made with math and science and code. and the idea that you can take those things and it makes a movie and tells a story, can make these lovable characters. it's like a slam dunk. it's an easy job for me. >> somehow we almost made a mistake in thinking of it as two cultures to begin with that art and science are divorced. pattern exploitation and a certain kind of creativity based on mastery of a skill. >> yeah. >> do you see this as a problem that's solving itself? i'm not saying we shouldn't put more effort into it et cetera. but are we at least moving the train down the tracks? that 20 years from now, we'll say we're glad that danielle did all that work. look where we are now. >> it feels like we are making progress, and it feels like there's a swell of support for things. i do think it could very easily be lost, and that we all need to be pushing for it. and so that's why, ooh -- you

know, in a market like this we have a lot of opportunities in silicon valley and have girls who code who are doing amazing things with the summer program. but in smaller markets, it's harder for people to access stuff. if you go on made with code they have information about coding parties and girl scouts of america and girls, inc., having coding parties with made with code. there's all these opportunities now. i heard from a childhood friend of mine telling me she is starting a coding club for her daughter in her school. and i thought that's the coolest thing on earth. her mom says i don't really know how to code but i got the teacher involved. and what a cool thing for her daughter she gets to do that with her mom. >> danielle feinberg thank you for being with us. and thank you for teaching girls and encouraging girls. and thank you also for all the wonderful things you've brought to pixar. as a huge fan and a geek i am thrilled to meet the person responsible for so much of it. >> excellent. thank you.

>> "press:here" will be back in just a minute.

we were just talking with daniel feinberg of made with code. there are projects you can start right away. in fact, you can start them right now. that is our show for this week. my thanks to my guests. i'm scott mcgrew, and thank you for making us part of your sunday morning.

hello and welcome to "comunicad del valle." i'm damian trujillo. today we have a special treat for you. we have the best mariacchi in the world on your "comunicad del valle." >> nbc bay area presents "comunicad del valle" with damian trujillo. >> a celebrated 18 years of hosting this show "comunicad del valle" on kntv and what a better way to celebrate than with the best mariacchi in the world. thank you all for being here. whenever you play in this venue, it always sells out. why do you think people want to come to see you here? >> well i think that people have the money to pay for mariacchi.