Showing posts with label valuations. Show all posts
Showing posts with label valuations. Show all posts

2017-06-30

a16z VC Marc Andreessen On Tech Valuations and More (podcast)



Marc Andreessen Answers the Tech Valuation Question | Bloomberg.com: "many investors don't grasp what's changed ..."
“We make our money on the ones that work and our reputations on the ones that don’t.”
Stock returns tend to be driven by a handful of big winners; for venture investors, it’s even more lopsided. Venture-capital funds typically have a 50 percent failure rate -- half of the investments lose money, with half of those being total losses. The third quartile breaks even, or returns two or three times their money over five to 10 years. The real action is in their top quartile, which can generate return on investments of anywhere from three- to 1,000-fold.
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2017-04-18

GMO's Jeremy Grantham: Stocks 'Decently Different This Time' (video)

GMO's Grantham: Stocks 'Decently Different This Time'

Video above published Apr 3, 2017 by WSJ.com: Jeremy Grantham, co-founder of Boston investment firm GMO, doesn't expect valuations to drop back to normal levels for two decades. But he is keeping cash on hand to take advantage of any dip, which he says would need to be 15-20% to act.

GMO LLC (domain: gmo.com) is a global investment management firm committed to providing sophisticated clients with superior asset management solutions.

Keeping the Faith in Value Investing

Video above published Sep 14, 2016: Ben Inker, Co-Head of GMO’s Asset Allocation team, discusses the advantages of long-term valuation-based investing and why GMO is Keeping the Faith in this approach

GMO Quarterly Letter (pdf)
The 4Q2016 GMO Quarterly Letter features Ben Inker's "Is Trump a Get Out of Hell Free Card?" and Jeremy Grantham's "The Road to Trumpsville: The Long, Long Mistreatment of the American Working Class"
 GMO Quarterly Letter 4Q 2016


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2016-02-08

What Happened to LinkedIn? $LNKD Stock Down 58% Since Nov 10

LinkedIn 1-year stock chart (NYSE:LNKD) (source: google.com)
What happened to LinkedIn (NYSE:LNKD)? The stock is now down 58% since Nov 10--the shares started tanking in after-hours trading last Thursday after reporting financial results which beat expectations for revenue and profit in the fourth quarter and showed solid growth, but the company's forecast for the current quarter and year disappointed investors--2016 first quarter earnings guidance of 55 cents per share (analysts' were expecting earnings of 74 cents per share), and LinkedIn forecast revenue of $820 million (analysts were projecting revenue of $866.86 million)--

"We will now end the call with our outlook for the first quarter and full year. For the first quarter, we expect: revenue of approximately $820 million, representing 29% percent growth. Adjusted EBITDA of approximately $190 million, a 23% margin. And Non-GAAP EPS of approximately $0.55 per share. For the full year, we expect: Revenue between $3.6 billion and $3.65 billion, a range of 20% to 22% year-over-year growth. This includes a 2% FX headwind. It also incorporates removing $50 million of potential Bizo revenue contribution in 2016. Adjusted EBITDA of between $950 million and $975 million, a 27% margin at the midpoint. And non-GAAP EPS of approximately $3.05 to $3.20 per share." --LinkedIn (LNKD) Jeffrey Weiner on Q4 2015 Results - Earnings Call Transcript | Seeking Alpha

So what's wrong? LinkedIn: Why So Surprised At The Drop? | Seeking Alpha: "... the investment community is starting to realize that the 30%+ growth rates are gone and that the lower growth does not support the current stock price. Hence the correction. LinkedIn is not Facebook (FB) ... Growth is slower and margins are lower."

Stocks in the whole tech sector have seen losses this year, as investors continue to closely examine "Internet valuations." See: Tech-stock wreck destroys $529B this year and Bye-bye Internet bubble 2.0 (USA Today). There are, of course, other views of what happened to LinkedIn, one of which you can read here and here.

Domain: LinkedIn.com



Tweets about $LNKD




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2016-01-02

Jim Chanos: 'I Don't Think Apple's a Value Stock' (2013 video)

Apple stock (NASDAQ: AAPL) closed down at $105.26 Thursday, December 31, 2015, as Apple turned in its first negative year since 2008 (CNBC). Below is a 2013 video of investor, Jim Chanos.



Published on Sep 17, 2013 - A look backIn the 2 year old video above,  Kynikos Associates President and Founder Jim Chanos discusses some of his long positions and factoring in valuation when purchasing a stock. He speaks with Erik Schatzker, Stephanie Ruhle and Cory Johnson on Bloomberg Television's "Market Makers." (Source: Bloomberg)

Re: Tech, Investing, Capitalizing R&D through Acquisitions, Valuations

Apple (nasdaq: AAPL) One-year Stock Chart
Apple (NASDAQ: AAPL) One-year Stock Chart (source: google.com)
Apple Investors Want Juicier Holiday - WSJ - Dec. 23, 2015"What do Apple Inc. investors want this holiday season? Growth, a strong product cycle and a bigger stock buyback...  Mr. Ives joins a host of analysts who have recently downgraded their views on Apple’s shares in recent weeks. On Tuesday, Cowen & Co. analyst Timothy Arcuri cut his 12-month price target on Apple shares to $130 from $135. Last week, at least five other analysts lowered their price views amid what they see as indications of underwhelming iPhone sales...."

What's a value stock? Shares of a company with solid fundamentals that are priced below those of its peers, based on analysis of price/earnings ratio, yield, and other factors.

"Factor investing is at least as old as Graham and Dodd’s early treatises on stock selection from the 1930’s. Warren Buffett has been running a portfolio based on factor investing for 40 years, only he found his stocks manually as opposed to quantitatively. James O’Shaughnessy wrote the seminal factor investing book, What Works On Wall Street, in the 1990’s and has since revised it several times. Ironically, the popularity of factor tilts (Smart Beta ETFs are now a half-trillion dollar category) may be the strategy’s biggest risk – the premiums for premiums are being compressed now that everyone is betting on the same attributes to outperform... To paraphrase Jesse Livermore, there is nothing new in Wall Street. There can’t be because factor investing is as old as the hills. Whatever happens in the stock market today has happened before and will happen again. Investors have been trying to buy a dollar for 80 cents since the beginning of time." -- Josh Brown, @reformedbroker Five Things Smart Beta Can’t Do For You

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2015-12-01

Reid Hoffman on the Valuation of Snapchat (video)



Reid Hoffman on the value of Snapchat - Published on Nov 19, 2015: Reid Hoffman, venture capitalist and co-founder of LinkedIn, discusses tech company valuations, social networks and his biggest investing concerns. He speaks exclusively to Bloomberg's Emily Chang on "Bloomberg West."

Snapchat principal domain name: snapchat.com





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2015-11-25

LinkedIn Co-Founder: Less Than Half of Unicorns Will Be Successful (video)



LinkedIn (LinkedIn.com) Co-Founder: Less Than Half of Unicorns Will Be Successful - LinkedIn co-founder and venture capitalist Reid Hoffman describes what he's calling a "quasi-bubble," as company valuations fluctuate between the private and public market. He speaks with Bloomberg's Emily Chang. (Source: Bloomberg) Published on Nov 18, 2015

Unicorn: a term in the venture capital industry to denote a start-up company with a valuation (based on fundraising rounds) of at least $1 billion dollars.

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2015-11-20

Unicorn Valuations 'Crazy' & Why Tory Burch will NOT do an IPO (video)



Tory Burch, co-chief executive officer at Tory Burch (toryburch.com), and David Kirkpatrick, chief executive officer at Techonomy Media (techonomy.com), discuss the Square IPO, unicorn valuations, innovation, startups, tech IPOs, and why Tory Burch will remain a private company. They speak on "Bloomberg ‹GO›" on November 19, 2015.


Tory Burch: We Will Award 10 Entrepreneurs $10,000 - In the video above, Tory Burch, co-CEO Tory Burch, discusses the company's new fellowship program. She speaks on "Bloomberg ‹GO›."




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2015-10-20

The Unicorn Trap: Sky High Valuations Kill IPOs For Tech Startups

  • startups have never been cheaper to build and are maturing faster than fledgling companies did in the last tech boom, partly because the smartphone era creates an easily reachable market of two billion people
  • yet only 14% of IPOs in the U.S. were done by tech companies, the smallest percentage since at least the mid-1990s, according to Dealogic
  • the market for initial public offerings has turned chilly and inhospitable, largely because technology companies have sought valuations above what public investors are willing to pay
  • venture capital investors could have trouble cashing in if the IPO market isn’t able to support even higher valuations
  • lower valuations as a private or public company also can sap the morale of startup employees who endure pressure and all-nighters in return for the possibility of a big payday 
  • an analysis of funding rounds by law firm Fenwick & West LLP in March found that 30% of private companies valued at $1 billion or more promised a specified IPO price ... [some] companies agreed to give additional equity to investors if the IPO price wasn’t met
The problem“The thing that worries me the most about all these [billion-dollar valuations] is that you need a public market to get liquid,” says Chris Douvos, managing director of Venture Investment Associates, a Peapack, N.J., firm that invests in funds and startups. “But who’s going to buy at these valuations? It’s all priced for perfection.”

The riskThe data suggest that even some of the most promising startups in Silicon Valley might be worth far less in the eyes of the rest of the investment world. The risk is that the lackluster reception for tech startups in the stock market could ricochet through companies that are still private.

source: Wall Street Journal

Further reading: Price and Value: Discerning the Difference (pdf) (Aswath Damodaran, NYU Stern)




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2015-10-14

Airbnb CEO Brian Chesky: We Want to Be Regulated (video)



Airbnb CEO: We Want to Be Regulated (video above) - Oct. 13, 2015 -- Airbnb Chief Executive Officer Brian Chesky discusses the success of the company and hotel regulations. He speaks on "Bloomberg ‹GO›."

Airbnb is a website for people to list, find, and rent lodging, often referred to as part of the "sharing economy." It has over 1,500,000 listings in 34,000 cities and 190 countries. CEO: Brian Chesky; Founded: August 2008, San Francisco, CA.  The company is privately owned and has achieved "unicorn" and "decacorn" status (total valuations of more than one billion dollars, and ten billion dollars, respectively). As of July 2011, the company had raised US$119.8 million in venture funding from Y Combinator, Greylock Partners, Sequoia Capital, Andreessen Horowitz, DST Global Solutions, General Catalyst Partners and undisclosed amounts from Youniversity Ventures partners Jawed Karim, Keith Rabois and Kevin Hartz, and from A Grade Investments partners Ashton Kutcher and Guy Oseary. In April 2014, the company closed on an investment of $450 million by TPG Capital at a valuation of approximately $10 billion. As of March 2015, Airbnb is raising a new round of funding that will place the company at a $20 billion valuation. (Source: Wikipedia)

Domain name: Airbnb.com

re: startups, venture capital, valuations, regulation, tech bubble




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2015-10-03

Jon Callaghan, True Ventures Founder, Discusses Tech Valuations (video)



Are Current Tech Valuations Sustainable? - Jon Callaghan, True Ventures' founder, discusses tech valuations with Bloomberg's Emily Chang on "Bloomberg West." Published on Sep 10, 2015

domain name: trueventures.com

re: startups, unicorns, venture capital




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2015-09-25

Roelof Botha, Startup Investing, Tech Valuations, Venture Capital (video)

Trending on Domain Mondo: >Saturday LIVE: Day 2 of CCWG-Accountability LA meeting
and >China (CAICT) Objects to ICANN CCWG Accountability 2nd Draft Proposal


Roelof Botha: Tech Valuations Not Near 1999 Levels - Roelof Botha, a Sequoia Capital partner, discusses the macro environment and startup investing with Bloomberg's Emily Chang on "Bloomberg West" on September 24, 2015.

Sequoia Capital - domain name: sequoiacap.com

Sequoia Capital is an American venture capital firm located in Menlo Park, California, United States. (Wikipedia)





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2015-08-27

Global Markets Addicted to Central Bank and Government Manipulation


Video above--Europe Stocks Rebound as Chinese Selloff Halts--August 27, 2015: European stocks joined a global relief rally as Chinese shares snapped a five-day losing streak. Shares rose in Europe and Asia after the biggest advance in U.S. stocks in four years on Wednesday helped restore some appetite for riskier assets. Developing-nation currencies rebounded from a record low and a surge in the last hour of trading in Shanghai sent Chinese stocks to their biggest gains in seven weeks. 

The REAL Liquidity Trap: Global Markets are now addicted to Central Banks and Governments intervening and manipulating everything from interest rates to currencies to equities (stocks).

Want proof?

Seeking Alpha: "Shares across the globe are skyrocketing after Wall Street cracked a six-day losing streak with its best rally in nearly four years. With momentum turning to the upside, investors seem to be covering their positions, while long-term bulls snap up perceived bargains. The rebound is also being attributed to falling expectations the Fed will soon raise interest rates. On Wednesday, NY Fed President William Dudley said a September hike seemed "less compelling" given recent global economic uncertainty."

China Intervened Today to Shore Up Stocks Ahead of Military Parade - Bloomberg"China’s government resumed its intervention in the stock market on Thursday and has been cutting holdings of U.S. Treasuries this month to support the yuan, according to people familiar with the matter. Authorities want to stabilize equities before a Sept. 3 military parade celebrating the 70th anniversary of the World War II victory over Japan, said two of the people, who asked not to be identified because the move wasn’t publicly announced. Treasury sales allow policy makers to raise dollars needed to bolster the yuan after a shock devaluation two weeks ago, according to different people familiar with the matter. China revived its equity purchases after the government’s absence from the market earlier this week contributed to the biggest two-day selloff since 1996. Under a new exchange-rate regime announced Aug. 11, the central bank relies on intervention to manage the yuan instead of its daily fixing. China’s surprise policy shifts have jolted markets worldwide as investors struggle to gauge their impact on the world’s second-largest economy."

China’s Stocks Surge in Late Trading to Halt Five-Day Plunge - Bloomberg"Stocks failed to sustain gains on Wednesday after the central bank cut interest rates and reduced the amount of required reserves for banks. The index tumbled 42 percent from its mid-June peak through Wednesday to erase more than $5 trillion of value as margin traders closed out bullish bets and concern deepened that valuations are unjustified by the weak economic outlook. Stocks on mainland bourses trade at a median 49 times reported earnings, according to data compiled by Bloomberg. That’s the most among the 10 largest markets and more than three times the 18 multiple for the Standard & Poor’s 500 Index."

Forget the headlines--nothing has changed from a few days ago--governments and central banks are intervening and actively manipulating global markets, even in secret, unannounced ways (see China stories above). This never ends well.

But when will it end? Probably when a sufficient number of market investors lose confidence in central banks' and governments' ability or willingness to continue to manipulate. Right now, enough "market investors" are still willing to be "market speculators" -- in effect placing casino-like bets on future "Fed policy" and "Chinese government manipulation." How high will valuations go in this giant global Ponzi-like scheme?

The "smart money" in China has already abandoned Chinese stock markets. Wealthy Chinese are moving money out of China. But the Chinese masses, and the rest of the world, are still "playing along" for now. When will expectations and speculations meet reality?


2015-07-03

Startups, Valuations, Unicorns, Venture Capital, a16z Slides/Podcast

Unicorn is a term in the venture capital industry, which denotes a start-up company whose valuation exceeds One Billion Dollars (US$). Examples are Uber, domain name: uber.com, a unicorn valued at $41.2 billion, and Snapchat, domain name: snapchat.com, a unicorn valued at $15 billion. Fortune magazine counted over 80 unicorns as of January 2015. According to Wikipedia, a new buzzword, decacorn, is now used for companies valued over $10 billion, such as Airbnb, domain name: airbnb.com, Dropbox, domain name: dropbox.com, Pinterest, domain name: pinterest.com, Snapchat, and Uber.
"While macroeconomic factors like low interest rates play a role, I think a big reason for the quantity of unicorns is the fear of missing out on one of the greatest periods of value creation we have ever seen. However, some of the most valuable opportunities — particularly the aforementioned market-makers — have strong winner-take-all characteristics: this potentially limits the number of quality unicorns. I think it’s this dichotomy that makes the current bubble discussion so difficult: most unicorns may be overvalued, but in aggregate they are probably undervalued. It turns out winner-take-all doesn’t apply just to the markets these startups are targeting, it applies to the startups themselves."--Unicorns - Stratechery by Ben Thompson (emphasis added)


U.S. Technology Funding -- What's Going On? 
From a16z.com - Andreessen Horowitz, venture capital firm - What’s going on in the public markets? What are all these so-called “unicorns”? What’s going on in venture capital?  "This time is different." It is different. Because it's always different... (published 15 Jun 2015)

Below: a recent a16z podcast: Taking the Very, Very Long View on Tech Investing--


It’s called “perpetual” or “eternal” capital, a very large pool of money that is invested on behalf of university endowments, foundations, etc., with a time horizon that extends generations into the future. The people who manage that money are driven by very different forces and thinking than your average Wall Street investor. Liquidity, for example, is not something this category of investors is immediately concerned with, nor are they swayed by your average economic cycle. At least, that’s the theory... how do these investors think in practice? In this segment of the a16z Podcast, Andy Golden of the Princeton University Investment Company, Ben Gomez of Pilothouse Associates, and Edwin Poston and Mel Williams of TrueBridge Capital Partners share their thoughts on tech valuations, liquidity in the markets, and what some in Silicon Valley may have a tendency to overlook.

So what's going on? Fewer IPOs, but more Unicorns that stay private for much longer, with multiple rounds of financing.


2015-03-06

Uber, Snapchat, Valuations Justified? (video)



CB Insights Research Analyst Matthew Wong and Bloomberg Contributing Editor David Kirkpatrick discuss the valuations of Uber and Snapchat and if they are justified. They speak to Bloomberg’s Cory Johnson on “Bloomberg West.”

domain names: uber.com and snapchat.com

2014-08-14

The Three Tiers of Top-Level Domains (TLDs)

So thanks to ICANN and its new gTLDs program, we now have three tiers of Domain Names (TLD domain name extensions) in the domain name ecosystem:

First Tier Top-Level Domain Names: .COM domain names
Second Tier Top-Level Domains: .NET, .ORG, ccTLDs and other open, unrestricted gTLDs
Third Tier Top-Level Domains: everything that's left--restricted, branded, closed, etc.--TLDs

A check with RegistrarStats and a review of Domain Name Sales reports confirms the above--you can't argue with the market consensus as to valuations and sales!

And so, unfortunately, we have to endure for several months more, the now boring, mundane release of countless additional new gTLDs still to come (yawn), second tier and third tier. Here's an example of a new third tier TLD:

The 'Land Rush' Has Begun: Register Your .nyc Domain | Gale A. Brewer - Manhattan Borough President: "... All registrants are required to have a physical street address in New York City (with no P.O. boxes permitted)... By October 7, if nobody else has requested the same address, it's yours. If there are multiple requests for the same address, an auction will be held to determine who will own it. A successful domain name registered during Land rush will cost $30 plus $20 for each year it registers the name... We don't want the .nyc portal to become a corporate playground; it should enable local organizations and businesses to have a presence online. The bodega, the corner pizza place, the 24-hour locksmith, the family-run shoe repair service -- that's what this is about..." --great, every corner pizza joint in New York City needs its own .nyc domain name (even if it costs more than double what you would pay to register a dot COM domain name)--such a deal!



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