Airbnb's fortunes 💪
Venture deals, IBM's acquisition, and Metaverse may be delayed.
Market summary: 📊
Indian markets took a tiny step back to process things after a bumpy start to the week. US had a meh day yesterday as Putin gridlocks the markets with his tanks still pointed at Ukraine.
US:
S&P 500 - up 0.088%
Nasdaq - down 0.12%
India:
Nifty 50 - down 0.17%
Sensex - down 0.25%
Quick shot of mid week brew ☕
🗣️ Resolution in sight — India’s negotiation with Tesla has reached an interesting point. Reports suggest GOI may be willing to slash import duties for Musk’s boys to sell cars here, if Tesla agrees to buy atleast $500 million worth of components from Indian suppliers every year. Currently, Tesla’s global operation does actually purchase about $100 million worth of components from India, so GOI’s demands aren’t exactly a long shot!
🧐 Lending problems — data from RBI says about 10% of all credit loaned out by Big Banks in India to businesses actually ends up in the coffers of Zombie firms, i.e. companies on the verge of bankruptcy, or losing money with no sign of revival in sight. May seem like a no biggie, but the numbers are getting heightened attention in the middle of the AGB Shipyard fiasco, and especially when there’s a whole bunch of SMEs and Merchants on the other hand who struggle to get access to formal credit of any kind!
Airbnb’s growth wheel keeps giving 🤙
What happened — Airbnb smashed all expectations for its 4th quarter earnings last night, processing $11.4 BILLION worth of bookings on its platform for the last 3 months of 2021!
Few businesses have experienced the roller coaster Airbnb found itself on since the first wave. Demand froze in 2020, only for bored tech workers to save the day by hopping cities and working from cool pads through the past 2 years. And now these longer term renters have become the company’s bread and butter!
Quick look at some stats for 4Q 2021:
Revenue grew 78% YoY to $1.53 billion
Average daily rates jumped 20% to $154
Profit of $55 million, Airbnb’s first ever in Q4
50% of the stays booked were for a week or longer
Management offered strong guidance to investors that the tailwinds will last through 2022. Stock jumped 6% yesterday, to give the company a a $120 billion market cap. Here’s a link to the shareholder letter.
Wishful thinking — brands like Oyo meanwhile failed to make the most of the remote work opportunity, with demand still trailing at 40-50% of 2019 peaks. Still feels like a remarkable opportunity to build!
Quick temp-check on India’s Venture Town 💰
GOQii, a fitness wearable brand, closed a $50 million Series C from Sumeru Ventures, Mitsui and a couple of other investors.
Started by the founder of Indiagames (acquired by Disney in 2011) GOQii sells a wearable fitness-tracker (kinda like Apple Watch-lite) which deeply integrates with its own services — like coaching, therapy and other healthcare products based on the data they collect. There’s also health coverage plans offered.
Fresh funds will be used for international expansion and to extend therapies for diabetes and women’s health. Cool stuff, weird name tho.
Meanwhile, Bezos plants some of his retirement fund 💸
The Chad of e-commerce joined hands with Tiger Global and Sequoia to lead an $80 million Series C in an Indonesian SaaS startup called Lummo.
Lummo sells a Shopify-like service to SMEs to kick off their own online stores — including tools for marketing, data management, and the whole spread to help scale their business online. Fyi, Lummo is the second Indonesian startup to receive big money from Bezos recently after Ula. Some fascination huh!
IBM purchased an Indian consulting company 🌟
What’s poppin’ — IBM continued to deepen its foray into hybrid cloud, buying out a specialized cloud consulting platform called Neudesic.
The Irvine, CA HQ’ed business (with more than 50% of its employees in India) specializes in everything related to Microsoft’s Azure Cloud — helping laggard enterprises (like your favorite basmati rice brand, and some rando FMCG company, you get it…) build out and maintain their computing and data operations, and associated services.
Meanwhile, a leaner, meaner, newer IBM under the leadership of new CEO Arvind Krishna, is fighting to rediscover growth — cutting off all old legacy businesses, and focusing only on cloud applications, hosting, and related consulting.
Why care — with the stock market volatile, valuations pulled back, and liquidity drying up, old-school giants are using the uncertainty to buyout emerging companies for pennies on the dollar.
Closing out — Roblox failed to live up to the Metaverse hype 🎮
90s kids had Orkut and Facebook, kids after that chose Roblox. However, yesterday the social-gaming company, which had been the darling of Metaverse investors, failed to deliver — missing revenue, profits, and engagement targets.
Stock was promptly hit 25% in a single day, offering investors a sweeeet reminder that expectations are running way ahead of reality!
Regardless, there were some amazing stats in Roblox’s report — for example, they have about 54 million daily active users, majority of who are under 20 years old, and spend an average of 175+ minutes a day playing on the platform!!
For comparison, Facebook and Instagram lovers barely spend 30-45 mins on these apps a day. One reason why Facebook stock was getting hammered few weeks ago!
And while we’re on the Metaverse, ☝️
In the stuff of nightmares, old-school banks have begun buying real estate in virtual universes. JP Morgan last night made some waves by opening a lounge of its own, called the Onyx, inside the popular 3D virtual platform Decentraland.
Spaces like these could be great ways for banks to sell services, push marketing, or for now, just keep nosy shareholders at bay!
What else are we Snackin’🍿
🚙 Prep for the robots - Jaguar Land Rover signed a deal with Nvidia to develop automated driving systems based on Nvidia’s platforms.
😔 Lost another legend - iconic Bollywood singer Bappi Lahiri succumbed to obstructive sleep apnea yesterday at the age of 69. RIP.
👎 Make in Russia - tech companies with more than 500,000 users but no local offices in Russia will be banned from running ads and growing their services in the country. Russians are asking Google, Twitter, and even Facebook to open local offices.
Hit that 💚 if you liked today’s issue.
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