on March 19, 2020
In this edition, the first lead article is on DoorDash’s IPO filing and the second is on the Space Economy. DoorDash filed confidentially on Friday, February 28 for its initial public offering, reopening the window for app-based customer-focused mega unicorns after a short lull. While the odds are stacked against it, as they are for all unprofitable start-ups, we believe DoorDash may buck the trend by showcasing itself as the largest, best of breed delivery company in North America, with a clear path to profitability.
The second article takes a peek at the space economy that is gradually taking shape. It is expected to expand to multi-trillion dollars in the coming decades. While that’s still a long way from where the industry is today, a number of developments are pointing in the right direction.Read More
on March 19, 2020
The first lead article, Spotlight on Stripe Gets Brighter, is on the expected increased spotlight on Stripe following the wave of consolidations in the fintech space. The 11-year old fintech unicorn has raised $1.3 billion in seven rounds to date, sports a $35.3 billion private market valuation, and is ripe for its own initial public offering (IPO). Even if it decides to hold off on the IPO, we expect the company to be an active participant in the ongoing M&A activity in the payments space.
The second article, Autonomous Cars Front and Center at CES 2020, touches on three displays at the CES show in Las Vegas that we believe captured broadly the latest developments in the autonomous car market – particularly the electronics in the car and various concept cars. Given that cars are transitioning toward electric powertrains, autonomous driving technology and connected online infotainment experiences, the attraction of autonomous cars was obviously strong and expected to get stronger over the coming years.Read More
on December 11, 2019
The two lead articles in this edition are very topical. The first one, Could Direct Listings Become the New Normal? Highly Likely, is our take on the direct listings as the way forward. This follows the recent filing by NYSE with the SEC to change the rules so that private companies can simultaneously go public through a direct listing and raise new cash from public market investors. We believe the proposed rule change, if approved, will very likely move the direct listing needle in its favor.
The second article Expecting a Strong and Rational IPO Market in 2020, lays out our expectations for 2020. We believe the outlook is strong and coming on the back of 2019’s hits and misses, the expectations and valuations will be much more rational.Read More
on November 15, 2019
The first lead article is on 5G and the tidal wave of innovations it is expected to unleash, particularly in the areas of healthcare and the Internet of Things. The second article is our take on the recent hiccup in the IPO market even as 2019 is on track to be the most lucrative year for exits in over a decade.Read More
on September 16, 2019
The two lead articles are ‘Startups for Startups’ and ‘AB5 Strikes at the Core of the Gig Economy’. With the proliferation of venture capital funding in larger rounds at seed stage and beyond, startups are larger than most tech companies that went public in the 1990s and 2000s. The institutionalization of venture capital and start up funding has also led to robust marketplaces of surrounding services for the startups, specifically in adjacent domains and non-core areas of the key business value proposition. The second article is on the implications of the passage of the California AB5 bill. We believe it is a misguided policy and will hurt employees, businesses and consumers rather than helping them as was originally intended.Read More
on September 16, 2019
The first one, ‘The Future of Batteries is Aluminum – Not Lithium’ makes a case for aluminum-air batteries in place of lithium-ion batteries that are the current go-to batteries for big technology and car companies. The second article, ‘It’s a Bird…It’s a Plane…It’s a Drone!’ looks at the state of drone technology and the timeline for mass commercial deployments.Read More
on July 10, 2019
The first article stays on the theme of autonomous cars that we have been writing about in the last few editions. Our main take here is that we can get autonomous vehicles today, but they will not be safe. In order to have safe AVs, we need at least 10 years of data gathering. AVs use a type of intelligence algorithm called neural networks, and the main characteristic you have to know about neural networks is that they are the most data demanding algorithm out there. The second article is our commentary on the IPO market. We believe there is a perfect confluence of events underlying this strong IPO market. The key question as we enter the second half of 2019 is whether the IPO juggernaut will continue to power ahead? We believe all key indicators suggest the second half will be equally strong compared to the first half of 2019, with enterprise software/cloud companies leading the charge.Read More
on June 20, 2019
Reaching profitability is the Holy Grail for the ride hailing companies. The narrative today is that autonomous vehicles (AV) will eliminate the biggest cost component (driver commissions), thereby increasing the take rates and moving the companies closer to profitability. While we believe AVs will accelerate the timeline to reaching profitability, a lot more expenses need to be factored in before we get there. The second article looks at the micromobility business in the face of large investments in this business by the participants. We believe this business in the long run will be net additive to the overall ride hailing business, given its compelling economics and growing demand.Read More
on June 20, 2019
The two lead articles are titled ‘Lyft Has AV Mapped Out’ and ‘Digital Ads Surpass Traditional Ads’. Both the articles are topical given the recent IPOs of Lyft and Pinterest. The race to introduce the first commercially viable autonomous vehicle (AV) is on. A number of companies are jockeying to be the leader given the high stakes, particularly for Uber and Lyft, the incumbent leaders in the current ride-hailing market. Handicapping the winner in this race is not easy but early indications suggest that Lyft is ahead of the pack. The second article is highly supportive of Pinterest given its mobile-native platform and digital ad-based revenue model. The digital ad market is on a strong growth trajectory, essentially insulated from the challenges facing the traditional ad market.Read More
on June 20, 2019
The two lead articles in this edition are very topical. The first one, ‘Lyft to Lift the Hood’, is our take on the ride-hailing market and Lyft’s strong competitive position in it, which is essentially a duopoly. The second article, ‘A Hardware Speed Bump for Neural Networks’, highlights the limitations of harnessing the full potential of artificial intelligence.Read More
on March 4, 2019
The first lead article ‘Are We There Yet?’ is our take on the timeline for commercially viable autonomous vehicles. There is no doubt that autonomous cars will one day replace the need for human-driven cars given the safety factor. Until then, which could be anywhere from 5 to 25 years depending on whom you ask, all the pieces of the puzzle still need to come together. The second article ‘AI, ML and the Ripple Effect’ highlights the flip side of artificial intelligence and machine learning technologies in our lives, particularly its potential to widen the divide between the haves and have nots.Read More
on January 7, 2019
The two lead articles are ‘Onwards to 2019 with Strong Tailwind’ and ‘Let the Race Begin – And the Speculation’.
To say 2018 was a remarkable year for IPOs is an understatement. With favorable market conditions during the first three quarters of the year, nearly 200 public offerings were completed rivaling, after a long lull, the strong activity levels in 2014 and early 2000s. More important, of all the companies going public in 2018, 38 were valued at $1 billion or more at the time of their IPO. This made 2018 the year with the highest number of unicorn public offerings since the 2000 dot-com bubble. Looking ahead, 2019 is shaping up to be another remarkable year for technology unicorns.
Lyft and Uber have already announced their plans to IPO in 2019 and a number of others are teeing up for their own IPOs. Whether the rush to the exits is due to tightening market conditions or some other reason, the 2019 IPO pipeline is promising to be remarkable in terms of numbers and size.Read More
on November 20, 2018
Online food-delivery platforms have hit their stride if recent funding rounds are any indication. Instacart raised $600 million in early October at a $7 billion valuation. DoorDash raised $250 million last August at a $4 billion valuation, topping its own earlier round of $535 million in March at a $1.4 billion valuation. Postmates raised $300 million in September at a $1.1 billion valuation. UberEats, an emerging leader in the delivery business, should be valued at $20 billion according to Goldman Sachs. To say the online food delivery business is hot will be an understatement.
The second article highlights the key takeaways from the spate of IPOs since the beginning of 2017 to September 2018. We highlighted a number of trends and patterns that we believe are noteworthy.Read More
on November 20, 2018
‘Trade Ware Redux but This Time It’s Different’. If the ongoing US-China trade war reminds you of the trade war with Japan in the 1980s, you are not mistaken. However the stakes are higher this time, particularly relating to VC investments that have been mutually beneficial over the last 10 years but could get negatively impacted if the rhetoric heats up further.
‘Cashierless Checkouts – Another Shot Across the Bow of Middle Class Jobs’. The cashierless checkout technology is no longer just a possibility. It’s a reality and it’s happening now. While this technology provides business efficiency for Amazon, it comes with major socioeconomic consequences – not all beneficial.Read More
on August 27, 2018
The first lead article is titled ‘NYC Slams the Brakes on New Registrations’. The New York City council ruled to place a year-long cap on registration of new vehicles for ride-hailing businesses. This comes against the backdrop of worsening congestion, low driver wages, and the decimation of the once-thriving taxi industry, all of which, the pro-ban lobby believes has been caused by the explosive growth of for-hire vehicles. Leaving the political and socio-economic arguments of this new law aside, if the cap goes into effect, which is likely, we believe the revenue impact to the overall ride hailing market and Uber in particular in NYC will be minimal – roughly 6% of Uber’s total consolidated revenue base.
The second article is titled ‘Going from Copycats to Innovators, Chinese Startups are Turning the Tables’. China is accused of shamelessly cloning U.S. tech firms and business models. According to the New York Times, intellectual-property theft accounts for over $600 billion in losses per year in the U.S. Copy to China (C2C) is a term commonly used to describe Chinese companies copying the business model of successful foreign businesses. But some experts are saying that U.S. companies are now ‘borrowing’ from China more than ever before. Copy to America (C2A) could very likely become the next wave.Read More
on August 27, 2018
The two lead articles are Space – Ripe for Disruptive Technologies and Walmart India – Second Time’s a Charm? The space industry is a $350 billion market currently, according to estimates, centered primarily on satellites. Bank of America Merrill Lynch predicts the size of the space industry to reach $2.7 trillion in three decades. A vibrant ecosystem is expected to develop in the space as it increasingly becomes a hotbed of disruptive technologies and services. Besides the high marquee names, there are a number of innovative companies in the wings that are positioning themselves to introduce new technologies in the space.
Walmart is taking a second shot at entering the Indian retail market. The company agreed to take a 77% controlling stake in Flipkart for $16 billion. The jury is still out on the strategic value of the deal. Whether or not Walmart will succeed only time will tell. One thing is for sure: it was too compelling an opportunity to establish a foothold in a country that is expected to grow the fastest in the next few years.Read More
on June 29, 2018
The two lead articles are AI and the Rise of Passenger Economy and Supreme Court Ruling Raises the Stakes for eSports. Artificial Intelligence has become a dreaded word depending on how you look at it. Overall, we should be excited to embrace this new technology and optimize our economy and personal lives around it. The best thing anyone can do is keep an open mind and a willingness to adapt as our global economy undergoes significant changes. The second article looks at the recent U.S. Supreme Court Ruling to annul the Professional and Amateur Sports Protection Act (PASPA), which prohibited states from authorizing many forms of sports-related gambling. We believe eSports will be a huge beneficiary of this ruling, the silence of the industry notwithstanding.Read More
on June 29, 2018
The lead article – Privacy Issue Takes Center Stage is our take on the hot button issue of privacy – particularly the issue of who controls consumer’s data. Is regulation the answer to address this issue? The EU thinks so, but the verdict is still out in the US, as Facebook CEO Mark Zuckerberg and Apple CEO Tim Cook seem to suggest that some form of regulation may be acceptable.
The second article, 5G – Moving from a Dream to a Reality, highlights the developments in what experts say will be the “next big thing” in mobile technology. It appears the “ducks are lining up” for the technology to move past the testing phase to commercial deployment in the not too distant future.Read More
on February 14, 2018
Our first lead article titled, Persuasive Technology for the Greater Good, takes off on the recent controversy about iPhones possibly fostering a public health crisis that could harm children. The Hook Model that underlies addictive apps on smartphone is a double-edged sword, in our opinion. The second article titled, Is Amazon Warming Up in the Crypto Bullpen?, is our take on why Amazon purchased a number of cryptocurrency URLs recently. Could the e-commerce juggernaut be simply protecting its brand name or is it planning to shake up the cryptocurrency ecosystem with its own tokens?Read More
on January 2, 2018
Our first lead article titled Net Neutrality – A Solution Looking for a Problem? is our contrary take on the net neutrality order that is scheduled for a vote on December 14th. The core argument on both sides of the divide is clear. I believe the repeal lobby has a stronger case. The second article Hey Alexa – What’s Next in Tech is our belief that the digital assistants have come of age and are well positioned to become a “must have” device in 2018.Read More
on December 12, 2017
The Future of AR is Now Every year there seems to be a single buzzword that makes its way around Silicon Valley. Last year, it was machine learning, with major players such as Google and Apple doubling down on their efforts to advance the machine-learning capabilities of their platform. The push to better machine learning […]Read More
on September 19, 2017
Apple And The X-Factor The highly anticipated 10th anniversary Apple event turned out to be a ho-hum affair, thanks to the press leaks ahead of the event. The phone features are mostly evolutionary rather than revolutionary, as expected. But the iPhone X (10) could prove to be transformative in two respects: the $1000 price tag […]Read More
on September 19, 2017
The two lead articles are on Uber and Bitcoins, respectively. Following Uber’s recent decision to scale back operations in Russia, on the heels of its exit from China, we explore the possibility of a similar retrenchment in India with a partnership agreement with Ola – the incumbent leader. The Bitcoin article is our take on Howard Marks’ recent comment that the Bitcoin mania is a classic pyramid scheme.Read More
on July 5, 2017
The two lead articles, Uber – Our CEO Pick and Which Way to Exit – IPO or M&A?, are very topical given the current events. As dust settles following a series of scandals that rocked Uber, outsiders are left to wonder how will they fix this? The answer is simple: a new CEO with uber qualifications. We have identified the ideal candidate for the job opening. The second article is our take on the IPO or M&A exit decision that private companies will have to make in the face of tepid to poor reception by public market investors for unprofitable companies.Read More
on June 30, 2017
The two lead articles “A Cloud for All” and “Cryptocurrencies Go Parabolic” are on the growing ubiquity of cloud computing and the parabolic rise of cryptocurrencies, respectively. In just the last month, several tech giants have paved the way for making advanced machine learning and cloud computing technology increasingly available to smaller firms, pointing to a greater emphasis on cloud technology and advanced artificial intelligence as the future of computing. In the second article we have put in perspective the massive runups in several cryptocurrencies.Read More
Venture Bytes is a monthly insight report highlighting topical ideas, current trends and emerging opportunities in the global technology landscape