Palantir: Wall Street’s Latest IPO and America’s Greatest Big Brother Threat
For a company founded by infamous Donald Trump ally, PayPal co-founder, and member of Facebook’s board of directors Peter Theil, little is known about the secretive data-mining and analytics company, Palantir.[1] Named after the all-seeing and all-knowing magical crystal ball from J. R. R. Tolkien’s Lord of Rings series, Palantir certainly lives up to the ominous “big-brother” name.[2] A simple google search of the company reveals a multitude of questions and articles all asking what does Palantir do exactly.[3]
Based on the limited information released by Palantir and customers, the company focuses on data-mining information through the use of bot scrapping the internet.[4] While the use of bots to data mine is a rapidly common occurrence in the information age, companies like Palantir pose frightening consequences because of the amount of data they mine. Palantir scrapes webpages from social media sites to news publications to collect and build data profiles of people and patterns.[5] Once data is combined, Palantir’s software can detect “suspicious” activity and trends that are useful for law enforcement.[6] One of the main exposed Palantir uses is law enforcement’s ability to search Palantir software for connections in “phone records, photos, vehicle information, criminal history, biometrics, credit card transactions, addresses, and police reports.”[7]
The exact abilities of the company’s software are still unknown and kept secretive by the founder team and employees. The founders comprised of Theil, Stephen Cohen, Joe Lonsdale, Nathan Gettings, and CEO Alex Karp started the company in 2003.[8] The start-up had multiple big investors including, In-Q-Tel, the venture capitalist branch of the Central Intelligence Agency.[9] The early investors were enticed by Theil’s proposals that Palantir could aid against terrorist and national security threats that still haunted a post-9/11 America.[10]
Palantir has fulfilled its initial plans of becoming an essential tool for law enforcement by tracking data patterns for national security. Palantir’s customers are police departments across America, the US Army, while former corporate clients include J.P. Morgan and Home Depot.[11] Palantir can aid companies in identifying customer fraud by analyzing purchases and credit card information.[12] This software was born from Theil’s time at PayPal battling financial fraud.[13] The more startling application of the software’s ability to analyze patterns is to detection of criminals for law enforcement and government agencies. Police departments such as the New York and Los Angeles have purchased and employed Palantir’s software for “predictive policing.”[14] The crime-forecasting software can analyze and find parole violators, bail jumpers, and even predict the likelihood of an individuals to commit terrorism.[15] These powerful intelligence tools started to turn against law enforcement who have invested millions of funding into Palantir who in turn has increased prices.[16] Law enforcement now find themselves dependent on extremely costly software with only one company who can repair and update the policing tools.
Recently, Palantir has been under fire in the media for its use by the U.S. Immigration and Customs Enforcement (ICE) agency. In 2019, Palantir CEO Alex Karp finally admitted to aiding the ICE agency with Palantir’s software.[17] The software was able to track down undocumented immigrants across the country which led to large-scale raids and detainment by ICE.[18] Another tech giant in Silicon Valley, Google, terminated its contracts with the Pentagon after employee and public outcry and protests.[19] Now, Palantir has gained contracts with the Center for Disease Control and Prevention (CDC) to trace the spread of COVID-19.[20] Therefore, the company now has access to sensitive health records of millions of Americans, adding to its already very powerful database.
On September 30th, Palantir’s new initial public offering (IPO) floated shares on the stock exchange through a direct listing, instead of the traditional IPO process of selling shares to select investors and then trading the next day.[21] Under the stock ticker PLTR, Palantir’s stock began trading at $10 on September 30th and ended its first day of trading at $9.50.[22] Thus, while the secretive data company has been able to keep its activities and government contracts under wraps, it was able to nevertheless enjoy a successful IPO.
Footnotes
