Crypto bank run vindicates watchdogs’ vigilance 5 Jan 2023 Silvergate Capital, which takes deposits from digital-asset companies like FTX, had to raise funds and flog assets fast after customers pulled $8 bln. It’s a disaster for investors and the ambitions of CEO Alan Lane. For regulators who’ve kept crypto on a tight leash, it’s a win.
EU is stuck playing catch-up with Amazon and Apple 5 Jan 2023 Antitrust tsar Margrethe Vestager wrung concessions from the $880 bln e-commerce giant, while the iPhone maker could open to third-party app stores. That sounds like progress, but the giants could have other tricks up their sleeves. Enforcers will be left racing to keep up.
Capital Calls: Meta’s fine problem 4 Jan 2023 Concise views on global finance: The social networking giant was penalized nearly $800 million last year in a series of European charges over how it treated user data. While 2023 is young, Meta has just been fined half as much. It's just a start.
Starbucks will go grande on workforce-lite future 4 Jan 2023 The $120 bln latte purveyor is fighting off unions as workers seek better benefits and higher wages. In 2023, it will throw a few concessions. That will tide over employees long enough for it to streamline coffee-making. It’s a playbook for those looking to trim their workforce.
Disney’s next 100 years hinges on a metaverse 3 Jan 2023 A century ago, the media giant crafted theme parks that withstood decades of changing technology. It isn’t a huge leap from a real Disneyland to a virtual one that melds brands and streaming. Innovation is necessary, but for it, boss Bob Iger’s days need to be numbered.
Foxconn reinvents itself, and EV supply chains 3 Jan 2023 The Taiwanese giant plans to make electric vehicles, and the chips and batteries that go into them, for global automakers. That’s a twist on its business of churning out iPhones for Apple in China. As far as strategic pivots go, this one is ambitious and much needed.
“Lifetime value” is Silicon Valley’s next buzzword 28 Dec 2022 As the cost of recruiting customers rises, tech firms and investors are paying more attention to the revenue users bring in. It’s a welcome shift from breakneck growth. Yet as with previous favourites like “total addressable market” or “flywheel effect”, the idea may get garbled.
E-commerce will go viral on social media in 2023 27 Dec 2022 TikTok and YouTube are among those fighting for a piece of the estimated $46 bln shopping market that’s growing twice as fast as ads. It’s a sensible strategic move, but recession would dash some plans. Many products also won’t suit the apps and competition is expanding quickly.
Microsoft’s $69 bln deal runs on European time 21 Dec 2022 A U.S. effort to block the software developer’s Activision acquisition promises to be a long and uphill climb. Brussels and London, however, could extract concessions sooner. It’s an indication of how other jurisdictions backstop increasingly hardline American regulators.
Mark Zuckerberg will split Meta, take the ‘verse 21 Dec 2022 The Facebook founder’s belief in the promise of a virtual world is failing to sway investors. He may control the company, but capital flight is a problem. The solution will be to break off his pet project and find someone else to run and rebuild the social media empire.
Netflix will be next on Microsoft’s shopping list 20 Dec 2022 The video-streaming service is expanding into gaming as the software titan fights for Activision Blizzard. Ever-bigger deals, including LinkedIn and Nuance, have been a staple of boss Satya Nadella’s tenure. And there’s logic behind fortifying its Xbox even more.
Apple finds a happy home in India 20 Dec 2022 IPhone makers Foxconn, Pegatron and Wistron are ramping up factories: $30 bln of official handouts help to make India an attractive place to set up. Trade tensions between Beijing and Washington only speed up a shift that will place India at the core of Apple’s supply chain.
Capital Calls: Satellites deal, EU gas price cap 16 Dec 2022 Concise views on global finance: Private equity firm Advent is paying a 129% premium for Maxar, indicating that the volatile, costly satellite construction business could soar away from public markets; the EU is edging towards a controversial cap for gas future contracts.
A solo Ticketmaster might attract financial fans 15 Dec 2022 Drums are beating to break up $17 bln Live Nation after it flubbed ticket sales for Taylor Swift and Bad Bunny. Lawmakers reckon a 2010 merger with Ticketmaster made the company too powerful. Setting aside legal and regulatory questions, there’s an investment case for a split.
Tesla has lost its fantasy premium 14 Dec 2022 The electric-vehicle leader’s valuation has halved this year. That’s still compatible with Tesla growing to rival Toyota in size. But it ascribes no value for boss Elon Musk’s futuristic ideas, such as humanoid robots and self-driving taxis. At $500 bln, Tesla is just a carmaker.
Capital Calls: Lucky LBOs, Byron Trott 12 Dec 2022 Concise views on global finance: Coupa Software, a business that tracks expenses has a message for investors weighing its sale to Thoma Bravo: it is doing terribly. Byron Trott’s BDT is taking grill-maker Weber private again for $3.7 bln, a discount to last year’s IPO valuation.
The ghost of Instagram haunts Microsoft’s future 9 Dec 2022 When Facebook bought the photo-sharing site in 2012, regulators failed to see Mark Zuckerberg’s larger vision. Now the FTC is trying to block Microsoft’s $69 bln Activision deal, partly to stop future domination. Fighting on qualitative terms seems unfair but is inevitable.
Asia debt craze spawns vicious tech funding circle 9 Dec 2022 India’s Byju’s wants easier terms on an existing $1.2 bln loan, one of a series of punchy deals the region’s hottest money-losing firms sold to BlackRock and others ahead of planned listings. Poor results and rising funding costs raise the stakes on getting IPOs across the line.
Friendshoring makes sense if done in the right way 5 Dec 2022 The United States and its allies want to build up suppliers of goods such as solar panels in friendly countries so they’re not vulnerable to Chinese disruptions or blackmail. To avoid self-harm they should define friends broadly and not attack China economically, says Hugo Dixon.
Salesforce shakeup puts co-CEOs under a cloud 1 Dec 2022 Bret Taylor is stepping down after just a year of running the $140 bln software developer alongside founder Marc Benioff. Another former copilot lasted less than two years. Because entrepreneurs typically struggle to surrender the reins, sharing them is often a terrible idea.