Techsight. 18
Stock Markets, Cappuccinos & Snowflakes
This newsletter represents a curated form of my daily reading/learning process. If you find some joy reading it, feel free to spread the word.
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This week's Techsight. covers the latest news from e-commerce & the current state of technology stocks (and you will learn what the stock market has in common with a cappuccino).
Songs of the week:
The Woo by Pop Smoke, 50 Cent, and Roddy Ricch (Link)
Popstar by Drake (Great video)
Life is Good by Drake and Future (Link)
INTERESTING STUFF:
Kind of cheesy but I liked this one a lot:
And for everyone who is looking for book recommendations… here is a great compilation:
The Financial Times had a great backstory on the whole investigation behind the Wirecard scandal. Very interesting to see the whole case from the perspective of the journalist who stated that Wirecard was a fraud a long time ago. (Link)
More from the FT: a great story on talent and motivation. (Link)
According to Microsoft’s security experts, Russian hackers are targeting the US election. Feels like 2016 again... (Link 1, Link 2)
E-COMMERCE & NEW RETAIL
Benedict Evans published an interesting blog post on where Amazon's profits are coming from. The phrase „all of Amazon profits are coming from AWS is not true anymore. At least not for Amazons US businesses. One has to realize that Amazon owns many different business units that are all in different stages in their lifecycle (and hence, their profitability). Just because Amazon only reports aggregate financial data doesn’t mean that it is not profitable… If you want to differentiate yourself against Amazon in your industry, you must know how and where the giant makes money - hint: almost everywhere - from the unbundling of finances to healthcare and digital ads... (Link)
More on Amazon: Jeff Bezos jumps onto the Indian bandwagon. After the Indian telco giant JIO went on a near-endless fundraising spree earlier this year, its sister company Reliance retail is shadowing this moves recently. The Indian e-commerce and retail company recently raised money or is in talks to raise money from KKR, Silver Lake, Amazon, L Catterton, and the Saudis. Amazon’s deal would be by far the biggest. Bezos is reported to be offered a 20bn. of shares. Let’s see how this will play out. Amazon and Reliance would instantly become a strong competitor for Walmart and Flipkart in the Indian market. (Links: Bloomberg, Financial Express)
Can the running shoe maker ON leverage Roger Federer to take on Nike and Adidas? Interesting for everyone who is interested in direct to consumer companies and modern retail strategies. (Link)
TECHNOLOGY & THE STOCK MARKET
Tech Stocks saw a heavy decline last week, evaporating much of the recent gains. IMO Troy Gayeski from Skybridge made a good point on the issue: „What we think we are going through is a healthy correction, removing the froth … If you're a tech investor you had to understand that the valuations were very high“ - I really like this analogy because it combines two things I like: coffee and stocks. Unfortunately, I have forgotten from whom I got the corresponding quote, but here it is anyway: „In a market, a bubble is like the froth of a cappuccino. A little froth is a very good thing. A lot of froth, especially if you mix in a lot of inexperienced people, that’s a bad thing.“ (Link)
Bytedance has rejected Microsoft's takeover bid for TikTok. Now Larry Ellison's software company Oracle is the favorite for the deal. The Tagesschau summarizes the topic in a short (2min) video - GER (Link)
The Wall Street Journal released an informative video on Apple's path from a struggling hardware enterprise to the most valuable public-traded company.
(Link)
Silicon Valley legend and founder of Social Capital Chamath Palihapitiya (and the co-owner of the Golden State Warriors), is reported to be close to signing a SPAC deal with Opendoor. All SPAC everything at the moment... (Link)
Has Warren Buffet finally fallen in love with technology stocks? Yes and no. Yes, Berkshire has invested heavily in software company Snowflake (around $570mn.) But no, this is not a Buffet deal. Two of his investment managers (Todd Combs and Ted Weschler) planed and signed the papers, saying that you can’t outperform the market without tech in your portfolio today. (Link)
VENTURE & INNOVATION
The VC firm Bessemer Venture Partners published its original investor memos for companies such as Shopify, Pinterest, LinkedIn, Fiverr, Yelp, or Twilio Inc. Considering how strongly the Bessemer Cloud Index has outperformed relevant benchmark indices over the last 7 years (almost 3-4X compared to the NASDAQ), it is even more exciting to read how BVP assessed the big winners back then.
(Links: Memos, Cloud Index)
Naval Ravikant’s company AngelList has launched a second-market for employee shares. This is a really huge step towards the democratization value creation in the technology business because it makes it easier for employees to monetize a portion of their stock options (see tweet). In Germany, we don’t even have a usable process for any kind of stock option programs…
Learn how Silicon Valley turned true innovation into an overhyped delusion: „Innovation Speak“ (Link)
Quote of the week:
„As wonderful as the Internet is, it has reinforced our worst tendencies. We accept the first google hit that confirms our beliefs - even if the hit appears on page 12. We don’t seek multiple references or filter out low-quality information. We quickly jump from “that sounds right to me” to “this is true”. Because confirming our theories feels good: we get a dopamine hit every time we are proven right.“
by Ozan Varol - Think like a rocket scientist
If you disagree or want to add a thought or two, feel free to connect with me via: Twitter, LinkedIn or email me at julian1108grunewald@gmail.com
