personal_noteS – Page 23

A Glimpse into Instagram’s Commercial Efforts

I will keep this updated
Based on personal ins screenshots

Effort One – Bis/Org official page and promotion

E.g.

Similar to FB’s news feed ads; similar to ads in Wechat Moments, etc.

Effort Two – Ads in Instagram Stories, in three forms: Learn More, Shop Now, Subscribe

E.g.

Currently Instagram hasn’t provide direct shopping/subscription function; it is linking to third-party websites.

But I could see it is possible to bypass Amazon or Apple ID subscriptions.

Effort Three – cosponsored

E.g. (from a public account through search)

This is more like a platform and pairing influencers with businesses. Provide a way for influencer to monetize and change the way businesses used in promotion.

Effort Four – cross suggestion/reference

It is not formally introduced to users. But it is enabled by Instagram’s ecosystem.

E.g., after I followed an independent hotel in Palm Spring, I got three likes from JW Marriott Desert Springs (a nearby hotel).

Also, I got followed by collegehousephilly after following DailyPennsylvania (student-run newspaper at Penn, mostly seen by Penn students); Philly is short for Philadelphia, where Penn is located.

Will keep updating this post.

A Great Symmetry?

A random thought here…

San Francisco = New York City (Manhattan)| in terms of the central hub in west/east, financial and corporate presence, high rise apartments

San Jose (South Bay) = Philadelphia | in terms of specialized industries, lead in Information Age (semiconductor) & lead in Industrial Age

Los Angeles + San Diego = Orlando + Miami + Key west | In terms of weather, travel and entertainment industries, life styles

So California is a semi-country.

In the Age of Services Bundling

The recent departure of Google Cloud’s CEO leads to many discussions on the business models. Specifically, Google Cloud service is usually co-marketed with other enterprise services provided by Google. For businesses that rely heavily on Google’s internet advertising, it feels a combination of a natural need of using its Cloud and an external soft-pressure from Alphabet.

US enterprise cloud business is mainly comprised by 3 companies – Amazon, Microsoft and Google. Amazon is famous for its 7-year head start. However, Microsoft Azure has surpassed AWS in revenue for the first time in Q2 this year.

[Some thoughts on cloud business: with its dominating position in enterprise market, and its Office suite going online with subscription model, Microsoft is definitely capitalizing a lot on the bundling with Azure cloud services. Google definitely wanted to replicate the business model, but found itself lack of comparable presence in the enterprise market – e.g. direct relationships, sales reps. That was probably the reason Alphabet brought in Diane Greene, co-founder of VMWare, in Nov. 2015 with all the enterprise connections and experiences behind her.]

The bundling + subscription is everywhere. Amazon Prime is a bundling, with original unlimited free two-day shipping to Amazon Music/Video/Fresh/Now, etc.; Netflix is essentially a bundling – with some core contents plus other programs; AT&A Direct TV is another example; Square is bundling terminals (POS), employee management…

It is so prevalent that I would like to say that instead of “software eating X”, it is “bundling X and just subscribe together”.

Capitalizing on Fear for Anti-Competition

Following up on the previous post of WSJ buying ads on Twitter, I found an underlying trend to explain it and other similar situations – companies are afraid of the accusations that they are preventing or reducing competitions, especially in the tech industry where network effects is extremely strong and “winners take all”.

Just another example here – Amazon Music putting ads on YouTube.

Fundamentally, there are similar laws around the globe focusing on competition, anti-monopoly and antitrust. Twitter doesn’t want to make the case that it is discouraging other medias’ ads; YouTube doesn’t want to make the case that it is discouraging other music apps’ ads.

It has more profound meanings other than ads. Google was fined in Europe for bundling Android in June with its other services, reducing competitions in services such as search. Going way back, Microsoft’s antitrust case in 2001 is probably the most famous one – a settlement was reached for its bundling of Windows and IE (may discourage other web browsers).

This concept can be expanded into many fields. And the fear of being seen as anti-competition is deeply rooted in every tech company.

We should see that Apple should welcome YouTube and Amazon Music so that it won’t be charged as anti-competition in music distribution. Apple Music is born with a market share limit.

Other examples – Apple should keep Fitbit with its Apple Watch, Chrome should keep other search engines with Google Search, Amazon should keep those third-party items with its AmazonBasic lines, etc… Uber should keep Lyft, Intel should keep AMD. Disney should be careful for its contents and distribution channels, so does AT&T…

There are many more examples. And this will last in the foreseeable future, maybe until ordinary antitrust law can’t handle new norms. Or, it may lead to excessive capitalization on the law. Basically, the other side will use antitrust as an very effective weapon. It won’t be a commonly used weapon among small companies due to high legal costs and lack of resources to maintain big market share. But it may be used more often by relatively big companies to expand into new fields with meaningful presence, building into conglomerates in the new era.

Stretched Valuation in Ride-Hailing – Uber’s financials and others

Uber reported some 2018 Q3 quarterly financial numbers on Wednesday.

As similar ride-hailing companies across the globe may go public in the coming 2019-2020, here I compiled some publicly available numbers together.

While Uber’s revenue growth is slowing down, at least it can target a 2019 full year revenue over $15 billion with 25%+ growth rate (an implied valuation multiple of 8x revenue).

Similar for Lyft – at least it needs an annualized revenue of $3 billion (an implied valuation multiple of 10x revenue), which means ~$750 million per quarter. It seems easier to achieve to me in Lyft’s case.

And Didi… its take rate from GMV is said to be much lower than Uber’s (~23%). Assuming a GMV of ¥120 billion in 2019 and a take rate of 10%, Didi will achieve an annual run rate of ~$1,700 million. Then it will be valued at 50x revenue multiple for a $85 billion valuation…

No comments on specific company. But overall, this space seems to have stretched valuation.

However, some other factors need to be counted in, such as low risk of competition (the market structure is mature or foreseeable I would say), the definite future of transportation-as-a-service (with growing market share in overall transportation), upcoming initiatives (e.g. autonomous car services, autonomous on-demand truck, etc.)

It seems that certain future is coming for sure in many investors’ eyes. Or they are just made to believe in it.

Moderna’s Long-waited IPO Filed, Raising $500+ Million

Moderna filed S-1 with SEC last Friday and will become the largest biotech IPO in history.

The record amount of raise ($500 million in current version of documents; I will expect more) just surpassed $421 million (HK$3.3bn) IPO by Innovent. In the past years, the typical size of the largest biotech IPO is around $200-300 million.

Since October, we have seen a series of large biotech IPOs that might also contribute to the money pulled from other biotech companies.

Here is the list of ever-increase IPOs in size since October:

– Guardant Health $238 million

– Allogene $324 million

– Innovent (in HK) $421 million

– Moderna (proposed) $500 million

Hawaiian language

US has no official language on the federal level, according to Wikipedia – very interesting. It seems to me that this is one of the many indicators of US being designed to be an overarching organization.

“There is no official language at the U.S. federal level. However, 32 states of the United States, in some cases as part of what has been called the English-only movement, have adopted legislation granting official status to English. Out of 50 states, 30 have established English as the only official language, while Hawaii recognizes both English and Hawaiian as official, and Alaska has made some 20 native languages official, along with English.”

Hawaiian language

The Hawaiian alphabet has 13 letters: five vowels (each with a long pronunciation and a short one) and eight consonants, one of which is the glottal stop called ʻ okina.

Frequently used phrase

Aloha = hello, kindness

Maholo = thank you

Kokua = support

Shaka = hand gesture of extended thumb and pinkie

Lei = necklace made of flowers, shells, leaves, or kukui nuts

Mauka = towards the mountain; makai = towards the ocean.

A hui hou = until we meet again

双十一的谜

双十一作为中国电商的标志性发明之一，已经走过十个年头。

每年都不例外的是，在双十一（和其它购物节），电商平台都尽力用数据表现出成交量之大，增长之高，购物速度之疯狂，等等。

除了常见的秀业绩的必要性外，疯狂的数据还可以 1. 加强运用消费者从众心理，让双十一买买买成为再正常不过的事情，“大家都在这时候买嘛” 2. 强调抢购的速度给消费者更少的思考时间，“要第一时间抢，手慢无”

虽说我相信数据上不会假，但数据背后的内容值得细想。

比如消费积聚在双十一所以九十十一三个月整体消费总额的影响？为了双十一数字好看牺牲的前后消费？消费总额实际没有增加多少？这个集聚效应应该近些年更明显。

比如依靠平台整合，把更多渠道平台流量计算到阿里/京东等头部平台里，但实际没有额外增量（对于阿里/京东可能没有额外营收或极低；对于去年整体消费可能增长很低甚至为负，但更大一部分消费被计入了头部平台双十一数字）

两个字难讲。

可以肯定的是，天花板越来越近，高增长信手拈来时代已过。

油价十连跌创纪录

这周五的WTI原油价格历史性连跌创 34 年以来最长记录（1984年7月）。借这个机会，来谈谈未来石油的角色。

电动车与新能源汽车

内燃机是一项伟大的发明，由此诞生的汽车经济体量难以估量。很难想象没有内燃机的当代社会能有什么工业生产，交通运输会是怎样。在人类文明史上，内燃机应该有与互联网一样的地位。

从全球原油用途的角度看，当下约有 60% 的需求来自交通运输（陆路，航空、航运等）。其中陆路运输占其中近 80%。大概是每20桶油有9桶用于陆路运输这样的比例。

另一个全球共识，各国家地区都已宣布并付诸实践的，是大力推动新能源汽车的发展，最具代表性的就是Tesla为首的电动汽车。按照各自的时间表，内燃机车的销售还能有10-20年。实际我认为电动汽车时代会来得更快，就像iPhone短短两三年就能让诺基亚和黑莓成为历史。虽然汽车相比于手机周期会更长，但变革来临时，用脚投票的消费者往往超出现有预期。最好的证明 – Tesla Model 3 在今年第三季度已经成为美国最受欢迎销量最好的车型。

眺望一下全球45%的石油需求可能消失的2050年，油价是什么？普通消费者完全不需要有油价的概念，这是一个淡出视野，出现在历史课本里的词汇。

沙特的焦虑

所以说，依靠原油作为主要经济来源的国家都得找出路。沙特首当其冲，也最具代表性。沙特土豪形象深入人心，靠着地下天然资源硬生生造出了一股强大的经济力量。

最能体现沙特的焦虑的，大概就是参与软银的基金。作为 Softbank Vision Fund 最大 LP，沙特在软银帮助下，频频出手在全球找未来行业进行大手笔投资。科技虽然是一个行业，但科技也是一个改变各行业的行业。所以，沙特／软银的投资不能单纯说科技导向，而是diversify + growth + market leader导向，比如 uber（交通），wework（商业地产），compass（住宅地产），guardant health（癌症检测）等等。

贵没有关系，要的是有分量的股权。

Tesla的创始人Elon Musk曾说有可能私有化，依靠沙特的资金支持。这是一笔很合理的买卖。Tesla是沙特地底黄金贬值的始作俑者，买Tesla算是一笔国运hedge。不过想靠私有化Tesla延缓电动汽车时代的到来并不现实，Musk也不会让出他的愿景。有科学的投资，沙特不一定要买Tesla；而且软银也投了其它电动汽车，比如Lucid Motor。

其它

各国家地区都在为未来30-50年的这个变化做出准备。加拿大选择了大麻业作为一个新增长点也是合情合理。
电动汽车时代到来只是早晚问题。石油的陆路运输需求会大幅减少，但在其它领域将依旧发挥重要作用。以Elon Musk的SpaceX为首的新一代太空运输，将补上部分石油需求，甚至大大超出现有需求；在可预见的未来，原油依旧是航空业的主力能源。石油在加拿大经济中也有重要作用。
发展中国家和地区的汽车行业可能还有增量市场。部分可能选择接受发达国家的传统汽车工业转移；部分可能选择传统汽车+新能源同步发展。有远见和能力的国家和地区可以全面地主动地拥抱电动汽车，直接跳过部分内燃机时代的基础建设和社会形态，走向世界最前沿。

Media In The New Age

It is not necessarily something new/surprising – traditional media are PAYING tech companies to be promoted.

I found this really ironic in the sense that originally most media should BE PAID to promote something. The reach to readers is built in the gene of media and defines one of the two pillars of media business model.

Tech companies like Twitter/Toutiao, are not just selling promotions/ads. To me, they are more like real estate developers. They are building towns/offices for people to live/work and renting out the places such as tops of buildings… What’s more, they are doing this everyday and creating places everyday with little physical limits and marginal efforts.

When the town is getting crowded, it becomes Manhattan, where real estates are pricey. Those who were invited as “Official Accounts” now needs to pay more money to be seen. The tech companies can run those auctions which no one questions their eligibility (and why Manhattan is in New York).