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2024 CNBC Disruptor 50: #31 Zum CEO on electrifying American school buses

The nightlife of school buses is about to get more interesting.

Zum, which provides student transportation including EV buses to 4,000 schools across the country, is partnering with the Oakland Unified School District to start selling power stored in EV batteries back to the California utility grid.

Oakland is the first school district in the U.S. to go fully electric with its buses, 74 in all, and will now be the first to test the concept of V2G (vehicle to grid) bidirectional charging. In effect, instead of the one-way charge into the vehicle, the school buses will be able to send their battery power back to the grid through Zum charging infrastructure.

Zum estimates that 2.1 gigawatt hours of energy can be sent from batteries back to the California grid annually. The company’s goal is to add 10,000 bidirectional EV school buses across the U.S. with 300 gigawatt hours of energy available to power grids each year. San Francisco Unified and Los Angeles Unified, much larger districts than Oakland, are expected to follow, Zum said. It also works with school districts in California, Colorado, Connecticut, Illinois, Maryland, Massachusetts, Missouri, Nebraska, Pennsylvania, Tennessee, Texas, Washington, Utah, and Virginia.

Zum ranked No. 31 on the 2024 CNBC Disruptor 50 list

More coverage of the 2024 CNBC Disruptor 50

There have been pilots across the country to test school bus V2G business models, but Zum says the time has come to move beyond the test phase.

“We at Zum strongly believe it is time to move beyond pilots and deploy sustainability solutions at scale. Converting the Oakland Unified school bus fleet to 100% electric with VPP [virtual power plant] capability is the right step in that direction,” said Ritu Narayan, founder and CEO of Zum, in a release.

In a CNBC interview later on Wednesday, Narayan referred to the school bus as “the largest battery on wheels,” with four to six times the battery of a Tesla.

According to Zum, the 27 million students moved across the country to and from schools twice daily is the largest mass transit system in the country. The roughly 500,000 school buses are mostly diesel, contributing to emissions. Zum has the goal of being a net-zero transport provider.

Pacific Gas and Electric, which is based in Oakland, has partnered with Zum to enable its bidirectional charging station for EV buses in Oakland.

Zum EV school buses at a charging station.

Zum

The concept is considered a strong one given the fact that school buses are not in use during peak energy demand hours, for example, between 5 p.m. and 10 p.m. This allows the buses, and their owners, to execute an energy arbitrage trade: charging up for their core daily task of moving students when energy prices are lower, and feeding battery storage back onto the grid when utilities will pay more for it per kilowatt/hour. As owner of the buses in use in Oakland, Zum will be the one to receive revenue from the grid deal, but in other cases where school districts own the buses, they can generate revenue. In some cases, the revenue from power sales could be split.

Narayan told CNBC that the school bus is an “ideal asset to be electrified” due to the battery and its predictable local pattern of use outside of peak hours.

Ram Ambatipudi, senior vice president of business development at EV Connect, which provides EV charging solutions, said the school bus model is one of the most promising in the area of using EV battery storage in a bidirectional nature. He said one of the biggest challenges is getting utilities to set a predetermined rate schedule that will allow for the arbitrage play across power markets, generating the revenue opportunity for the battery owners.

“There aren’t a lot of established rate schedules,” Ambatipudi said. In addition, a lot has to go right to make the model work and is still being tested. “It’s been more of a pilot level because that interplay has to happen between the vehicle charging station hardware, and software management of the station, and the backfeeding into grid and having the economic benefit paid out by the utility. “Those market developments have yet to come,” he said.

EV school buses today are two to three times as expensive as traditional buses, and the V2G model of selling energy back to the grid is part of the economic plan to make the transport technology more cost-effective for owners over time — EV battery costs are also declining while their efficiency rises.

The idea is similar in some ways to how owners of rooftop solar systems have been able to feed power back onto the grid in some markets, but in recent years, there has been pushback against these “net metering” relationships, especially in California. With buses, though, there is one key difference: the buses are not in use during the most important times of the day for the grid to have more power, and the buses can recharge at off-peak demand hours. Many rooftop solar power owners were selling energy supply back onto the grid when it was less needed.

And the arbitrage economics make sense: bus owners charge the vehicles during the lowest-cost periods so they can allocate excess battery power to be sold back into the grid when it is at its highest economic value.

There are many applications to take stored power in EV batteries and use as a supply, such as Ford pitching its F-150 Lightning EV as a home backup power source for when the grid is down and saying that has shown a surprising level of consumer appeal. But the school bus model may be the most effective at the largest scale.

“The low-hanging fruit from what I’ve seen is the school bus model,” Ambatipudi said. It’s not just the cycle of dropping off kids during the morning and then remaining idle at a depot during the middle part of day, and then cycling again in the afternoon and early evening into idle state again. During summer months, the buses are largely idle. “Buses can be used as essentially arbitrage devices to charge when power is cheap and discharge when needed,” he said.

Pilot CEO Adam Wright on EV charging: We think demand is going to push through

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Google would need to shift up to 2,000 employees for antitrust remedies, search head says

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Google would need to shift up to 2,000 employees for antitrust remedies, search head says

Liz Reid, vice president, search, Google speaks during an event in New Delhi on December 19, 2022.

Sajjad Hussain | AFP | Getty Images

Testimony in Google‘s antitrust search remedies trial that wrapped hearings Friday shows how the company is calculating possible changes proposed by the Department of Justice.

Google head of search Liz Reid testified in court Tuesday that the company would need to divert between 1,000 and 2,000 employees, roughly 20% of Google’s search organization, to carry out some of the proposed remedies, a source with knowledge of the proceedings confirmed.

The testimony comes during the final days of the remedies trial, which will determine what penalties should be taken against Google after a judge last year ruled the company has held an illegal monopoly in its core market of internet search.

The DOJ, which filed the original antitrust suit and proposed remedies, asked the judge to force Google to share its data used for generating search results, such as click data. It also asked for the company to remove the use of “compelled syndication,” which refers to the practice of making certain deals with companies to ensure its search engine remains the default choice in browsers and smartphones. 

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Google pays Apple billions of dollars per year to be the default search engine on iPhones. It’s lucrative for Apple and a valuable way for Google to get more search volume and users.

Apple’s SVP of Services Eddy Cue testified Wednesday that Apple chooses to feature Google because it’s “the best search engine.”

The DOJ also proposed the company divest its Chrome browser but that was not included in Reid’s initial calculation, the source confirmed.

Reid on Tuesday said Google’s proprietary “Knowledge Graph” database, which it uses to surface search results, contains more than 500 billion facts, according to the source, and that Google has invested more than $20 billion in engineering costs and content acquisition over more than a decade.

“People ask Google questions they wouldn’t ask anyone else,” she said, according to the source.

Reid echoed Google’s argument that sharing its data would create privacy risks, the source confirmed.

Closing arguments for the search remedies trial will take place May 29th and 30th, followed by the judge’s decision expected in August.

The company faces a separate remedies trial for its advertising tech business, which is scheduled to begin Sept. 22.

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Rippling valued at $16.8 billion as HR software startup raises $450 million, says IPO not imminent

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Rippling valued at .8 billion as HR software startup raises 0 million, says IPO not imminent

From left, Parker Conrad, co-founder and CEO of Rippling, and Kleiner Perkins investor Ilya Fushman speak at the venture firm’s Fellows Founders Summit in San Francisco in September 2022.

Rippling

Human resources software startup Rippling said Friday that its valuation has swelled to $16.8 billion in its latest fundraising round.

The company raised $450 million in the round, and has committed to buying an additional $200 million worth of shares from current and previous employees. The company’s valuation is up from $13.5 billion in a round a year ago.

Rippling said there was no lead investor. Baillie Gifford, Elad Gil, Goldman Sachs Growth and others participated in the round, according to a statement from the San Francisco-based company.

With the tech IPO market mostly dormant over the past three-plus years, and President Donald Trump’s new tariffs on imports leading several companies to delay planned offerings, the most high-profile late-stage tech startups continue to tap private markets for growth capital. Rippling co-founder and CEO Parker Conrad told CNBC in an interview the the company isn’t planning for an IPO in the near future.

Conrad also highlighted a change that’s taken place in public markets in recent years, since inflation began soaring in late 2021, followed by higher interest rates. With concerns about the economy swirling, many tech companies downsized and took other steps toward generating and preserving cash.

“It does look a lot like, in order to be successful in the public markets, your growth rates have to come down so that you can be profitable,” said Conrad, who avoided enacting layoffs. “And so for us, that sort of pushes things out until the company looks profitable and probably slower growing, right?”

At Rippling, annual revenue growth is well over 30%, Conrad said, though he didn’t provide an updated sales figure. The information reported last year that Rippling doubled annual recurring revenue to over $350 million by the end of 2023 from a year prior.

Given the pace of expansion, Conrad said he isn’t fixated on profits at the moment at Rippling, which ranked 14th on CNBC’s Disruptor 50 list.

Rippling offers payroll services, device management and corporate credit cards, among other products. Competitors include ADP, Paychex, Paycom Software and Paylocity.

There’s also privately held Deel, which Rippling sued in March for allegedly deploying a spy who collected confidential information. Conrad suggested that the publicity surrounding the case may be boosting business.

“I think it’s too early to say, looking at the data, how all of this is going to evolve from a market perspective, but certainly we see some companies that have said, ‘Hey, we’re talking to Rippling because of this,'” Conrad said.

WATCH: The IPO market is likely to pick up near Labor Day, says FirstMark’s Rick Heitzmann

The IPO market is likely to pick up near Labor Day, says FirstMark's Rick Heitzmann

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Fortnite applies to launch on Apple’s App Store after Epic Games court win

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Fortnite applies to launch on Apple's App Store after Epic Games court win

Jakub Porzycki | Nurphoto | Getty Images

Epic Games said on Friday that it submitted Fortnite to Apple’s App Store, the month after a judge ruled in favor of the game maker in a contempt ruling.

Fortnite was booted from iPhones and Apple’s App Store in 2020, after Epic Games updated its software to link out to the company’s website and avoid Apple’s commissions. The move drew Apple’s anger, and kicked off a legal battle that has lasted for years.

Last month’s ruling, a victory for Epic Games, said that Apple was not allowed to charge a commission on link-outs or dictate if the links look like buttons, paving the way for Fortnite’s return.

Apple could still reject Fortnite’s submission. An Apple representative didn’t respond to a request for comment. Apple is appealing last month’s contempt ruling.

The announcement by Epic Games is the latest salvo in the battle between it and Apple, which has taken place in courts and with regulators around the world since 2020. Epic Games also sued Google, which operates the Play Store for Android phones.

Last month’s ruling has already shifted the economics of app development for iPhones.

Apple takes between 15% and 30% of purchases made using its in-app payment system. Linking to the web avoids those fees. Apple briefly allowed link-outs under its system but would charge a 27% commission, before last month’s ruling.

Developers including Amazon and Spotify have already updated their apps to avoid Apple’s commissions and direct customers to their own websites for payment.

Before last month, Amazon’s Kindle app told users they could not purchase a book in the iPhone app. After a recent update, the app now shows an orange “Get Book” button that links to Amazon’s website.

Fortnite has been available for iPhones in Europe since last year, through Epic Games’ store. Third-party app stores are allowed in Europe under the Digital Markets Act. Users have also been able to play Fortnite on iPhones and iPad through cloud gaming services.

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