Facebook holds strong 💪
Oil on the rise, Esports Unicorn, and US travel resumes.
Market summary: 📊
India had another positive day on the back of the IPO chatter and enthusiasm. US finished in the green too, as earnings from big tech companies delivered big.
US:
S&P 500 - up 0.18%
Nasdaq - up 0.29%
India:
Nifty 50 - up 0.79%
Sensex - up 0.63%
What’s brewing hot ☕
✅ Round 3, team Zee — the Bombay High Court’s latest ruling favored Zee in its proxy battle with shareholders, asking Invesco to not call a shareholder general meeting unless Zee’s management is onboard with it. Doesn’t put an end to the month-long infighting but buys Zee some more time to stall, while it reaches out to other buyers or lobbies existing shareholders to retain control.
✅ Oil starting to hurt — increased consumption of oil to support post-COVID jump in economic activity, combined with a global shipping crisis, and policy changes, have pushed crude oil prices through the roof — now at $85 a barrel, a peak in around 7 years. If the trend continues, right from the pace of economic recovery, to corporate profits, to consumer spending, will start feeling some pressure.
Facebook will live to see another day 👻
Markets were expecting a dumpster fire from Facebook’s earnings, given Apple’s privacy changes hurting ad targeting, and the well-publicized whistleblower gate painting an ugly backdrop. But nope…
Thanks to billions of doom-scrollers, Zuck and his gang managed to grow revenues by 35% YoY, to $29B+ for the last 3 months — quite something for a $1T company.
But there were a few other interesting comments from team FB that kept investors busy:
FB is building its products (FB old + Insta) increasingly around Reels, and will focus on serving younger users better, vs. older people. TikTok changed the game!
FB is building a new business vertical called Facebook Reality Labs, which will include its VR and other Hardware products, and focus on expanding device installed base so it doesn’t have to rely on Apple’s devices to survive as it pushes into the Metaverse
FB does not apologize, but calls the whistleblower issue a targeted misinformation crusade based on “selective” stolen files
Lastly, engagement remains rock solid — Facebook is used by 2.95 billion people around the world, every month, 60% of whom open apps every single day.
Big picture — the $500B digital ad industry is expected to report one-by-one to show how much damage Apple has done to them. So far, Snapchat looks like it had the worst of it all.
Quick look at a transportation acquisition 🚌
Chalo, a mobility startup in India which had raised $40M in a series C a few weeks ago, acquired another company called Shuttl.
Shuttl used to run buses on busy routes in India’s major metros to help working professionals beat traffic blues. At peak pre-COVID, its fleet averaged 100K daily trips, but the business went kaput when folks started driving their own cars again due to hygiene scares.
Anyway, Chalo, which provides a SaaS platform to bus-fleet operators to digitize ops, hopes Shuttl can help the company build out its own fleet as well. Plenty $$ in modernizing good ‘ol businesses.
While we’re on startups,
Global ecommerce roll up king, Thrasio, raised a massive-ass round of $1B at an eye-popping $10B valuation, to keep acquiring popular Amazon brands. The company is busy building a Procter & Gamble of the modern world — one that is not constrained by the limited shelf space of supermarkets. Since last April, they’ve acquired 100+ brands!
Why care — the D2C rollup party will light up in India too where plenty of emerging brands see no meaningful exits, and the roll-up platforms keep seeing big-money wired into their bank accounts.
Closing Out — Esports gets its first unicorn 🦄
What happened — in a one of a kind deal, FaZe Clan, an esports and gaming company, is all set to go public on the Nasdaq, at a $1 billion valuation.
WTF do they do — FaZe started off as a YouTube channel in 2012, streaming gameplay of popular titles like Call of Duty and Counter Strike. Over time, the company expanded into a full blown gaming content and esports platform — that builds teams, plays for money, sells merch, holds events, etc. with 350 million followers across multiple social channels, with $50M+ in revenues, lining up partnerships with top brands from McDonald’s to DC comics.
Don’t underestimate gaming — Dallas Cowboys (American football team) are the world’s most valuable sports team franchise worldwide today, per Forbes. How much longer until the eSports guys displace traditional folks?
Also, how quickly gaming is moving from a fad to mainstream-culture, pulling big-$$$ is remarkable.
What else are we snackin’ 🍿
💳 Quick crypto partnership — Bakkt, a popular crypto rewards platform and wallet, forged a deal with Mastercard to bring its products to merchants worldwide. Bakkt stock jumped 300% in a day!
✈️ US travel resumes - The United States will lift all travel restrictions for vaccinated tourists and business travelers starting from November 8.
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