Google’s graveyard
WFH over, Biden meets Putin, and Bytedance surprises.
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Market summary: 📊
This week is looking like a washout with another soft day in India. US had a flat day, but tech saw some real winds behinds its back.
US:
S&P 500 - down 0.044%
Nasdaq - up 1.29%
India:
Nifty 50 - down 0.48%
Sensex - down 0.34%
What’s brewing hot? ☕
✅ Pajama party over kids — global corporations are ringing the bell on work from home. JP Morgan wants employees to return to the office by September, threatening with layoffs otherwise... Bank of America has extended deadlines by 90 days. Amazon has already moved to a 3-day office work week. As much as remote work offered flexibility, it plagued workers with depression, anxiety, loneliness, and overworking, and now a hybrid approach seems like the best middle ground solution. Expect other companies to follow.
✅ Oldies being baddies — General Motors, which owns Chevrolet, Chrysler, and other iconic brands, bumped up its planned EV spending agenda by nearly 75% overnight, now looking to deploy $35 billion to electrify the company’s fleet by 2025. Ford’s aggression may have driven GM management into FOMO, and these big moves by veteran companies should put other laggard auto companies on notice that they’re running out of time. Reads positively for the entire automotive value chain.
The graveyard of consumer products ⚰️
Google, which was assumed to be the only valid counter against Apple’s laser sharp pursuit of consumer health tech (devices and services), is apparently folding its hand — cutting back aggressively on the consumer health division, and routing that talent to FitBit and Google Cloud.
If you know the company, the behaviour is not new. Although it’s unclear what drove this decision, we’re guessing management realizes there’s no point to keep fighting a losing war as consumers get drawn to the Apple camp by promises of privacy, while here shareholders demand more financial discipline.
Meanwhile, the company’s enterprise pursuit of the Healthcare opportunity will continue strong, mostly with a broad suite of enterprise tools served via Google Cloud — shepherded by the mastermind Google Cloud boss Thomas Kurien.
Going forward — Google’s AI has made phenomenal strides in healthcare. A project with the NHS in the UK to detect diabetic retinopathy for example, is seeing respectable traction. Several other life sciences projects have been excellent too.
Big picture — $250 billion+ is spent each year on IT by global healthcare companies, nearly 25% of which is wasted due to inefficiencies. Perfect opportunity for tech giants to mint some profits.
Don’t sleep on Indian SaaS 😎
Mobile and web-app testing platform BrowserStack raised a $200 million Series B round from legendary investor Mary Meeker’s Bond Capital and Insight Partners at a $4 billion valuation, making it one of India’s highest-valued SaaS companies.
A bootstrapped operation until 2018, BrowserStack basically supplies nearly 4 million developers across 50,000+ enterprises with cloud hosted tools to test bugs, compile data, and generate reports for testing live apps and websites. Revenues are growing 70%+ to $100 million+ in 2020, amidst the pandemic’s boost to cloud software.
Profitability is just cherry on the cake, and Bond’s backing, which rarely comes easy, shows we have a category dominating giant in the making.
bring that IPO already pls?
Meanwhile, Softbank’s cooked up another unicorn 🤙
Sales training platform, MindTickle, which uses data driven metrics to provide training and feedback to enterprise sales staff on how to improve their pitch, raised another $100 million from Softbank at a $1 billion valuation. The platform, widely used across industries including finance, pharma, tech and oil & gas, has an ARR of $40 million+, growing 180%+ YoY. And that’d be Softbank’s 4th unicorn of the year, ladies and gentlemen!
Quick look at a Hot summer date in Geneva 🍹
Biden and Putin, like two uncles who hate each other's guts but will pretend to wing it at a family wedding, met up for the first time of bilateral talks in Geneva.
Agenda on the table was slim, yet focused — mostly revolving around Russia’s “enrichment” and favoring of cyber criminals who most notoriously were targeting critical corporations in the US, including Colonial Pipeline, and JBS.
Other items on the discussion agenda include 1. Security 2. Human rights issues in eastern Europe 3. Russia’s meddling in the elections of the US and around the world, and of course 4....
Here’s a complete coverage of the meet from CNN.
Bottomline — last when Trump met Putin in Helsinki, Finland, the meeting was a total disaster, with Putin taming the US on several key issues. This time though, press conferences from both leaders suggest constructive bilateral progress.
Closing out — why Bytedance is a MOOONNSSSTERRR 🤯
TikTok owner Bytedance’s growth won’t blink an eye, even as the company swells into one of the largest tech behemoths in the world. Wall Street Journal caught hold of an internal memo yesterday, which offers a sneak peek into financials.
Quick look at 2020 numbers:
Revenues of $34 billion for the year, up 111% YoY
Gross profits of $19 billion, up 93% YoY
Lost $2.1 billion, but that’s mostly due to stock based compensation paid out to employees
Has 1.9 billion monthly active users across all the platforms — next to only FB and Google
For comparison, Netflix made $25 billion last year, growing 25%, and is valued at $220 billion, which easily puts ByteDance at 2x that, at least.
Going forward — with founder Zhang Yiming quitting as CEO soon, new CEO Liang Rubo’s focus is on entering new “monetizable” verticals — think social and live commerce, payments, gaming, AND preparing for an IPO next year, likely the BIGGEST the world has ever seen.
What else are we snackin’ 🍿
💸 Healthcare boost - GOI, numbed by the pandemic’s assault, is cooking up a $6.8 billion program to boost development of healthcare infrastructure nationwide.
🤞 Billions and billions - nearly $9 billion of Gautam’s personal net worth has been wiped off with the ongoing rout hitting the Adani empire stocks.
Hit that 💚 if you liked today’s issue.
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