Last week, major indices ended mixed as the Dow Jones fell 0.1%, S&P 500 was down 0.3% and Nasdaq rose 0.6%. After a record Super Bowl, FanDuel parent Flutter Entertainment said it is considering listing on a U.S. stock exchange. Warren Buffett’s Berkshire Hathaway buys even more AAPL stock, ditches most of its TSMC. Airbnb posts a record Q4 as travel recovers post-pandemic. Roblox shares soar 27% as gains in users and virtual currency purchases lift quarterly results. Robinhood sees pop in crypto trading in January. Cathie Wood’s Ark Invest snatches up US$9.2 million of Coinbase stock after the crypto exchange’s massive January rally. George Soros’ fund reveals it’s betting against Silvergate as the crypto-friendly bank is probed over its ties to FTX. Bakkt to shutter consumer-facing app, focus on B2B crypto services. Meta Platforms may do more layoffs. Twilio cuts 17% of its workforce just months after previous round of layoffs. Tesla recalls 363,000 cars over full self-driving software. Ford’s EVs are getting faster charging and more affordable batteries thanks to new chemistry. Apple delays AR/VR headset launch again, now expects to unveil the device at WWDC. TikTok’s parent takes on Meta in battle for virtual-reality market with its two year old Pico acquisition. In Canada, Descartes acquired GroundCloud for US$138 million, as despite recent market volatility, its stock price has remained consistent in its growth trajectory. BBTV secured a $21.6 million loan to pay off an overdraft facility. Sophic Capital client Jasper Commerce, closed a first tranche of convertible debenture unit financing of $636,500 (full offering size of $500,000 plus a partial exercise of the over-allotment option). The Company may close further tranches of the over-allotment up to $113,500.
Canadian Technology Capital Markets & Company News
Descartes (DSGX-NASDAQ, DSG-TSX) acquires US-based GroundCloud for US$138 million.
Waterloo-based Descartes Systems Group has acquired GroundCloud, an American company that provides solutions for final-mile logistics, for approximately $184 million (US$138 million). GroundCloud represents the latest addition to Descartes’ portfolio as the latter continues its active acquisition strategy. The Waterloo company began trading on the Toronto Stock Exchange in 1998, and despite recent market volatility, its stock price has been consistent in its growth trajectory. Descartes was trading at $91.54 last year. As of today, Descartes’ share price is trading at $100.79, representing a 10 percent increase since 2022. This change in Descartes’ market value is a stark outlier among the rest of the tech sector. In the past, Descartes has also acquired Supply Vision ($16 million), Pinpoint ($15 million), and XPS Technologies ($65 million). http://bit.ly/3EjRFBd
BBTV (BBTV-TSX) secures $21.6 million loan to pay off overdraft facility.
Vancouver-based BBTV Holdings, the holding company behind media and technology company BroadbandTV, has secured a $21.6 million loan from MEP Capital Holdings III. BBTV closed this financing to “support its path to profitability,” with the intention of using this recent loan to pay off its overdraft facility with a Canadian chartered bank. BBTV did not disclose the exact amount of its overdraft balance, or the lender of the facility. In the company’s third-quarter earnings for 2022 it reported $20.8 million CAD in cash, and that it had used $10.6 million of its $15 million overdraft facility. Of the $16.1 million loan from MEP Capital, BBTV said that $10.1 million has been committed by the investor, with $6 million being conditional upon the company’s performance targets being met for the first half of 2023. BBTV has made moves to improve its balance sheets in recent months with the goal of acquiring more financing. In October, BBTV announced it is working with former majority shareholder, European media conglomerate RTL Group to help provide BBTV access to additional working capital. Prior to BBTV going public on the Toronto Stock Exchange in 2020, RTL held a 51 percent stake in BBTV. Much of BBTV’s IPO went to buying out RTL. However, RTL still held $30.9-million in convertible debt in BBTV, and as of 2020 was owed a further $15.7 million in accrued interest. RTL holds the option to convert its debt into subordinate voting shares of BBTV. https://bit.ly/3EgfcCY
Sophic Capital client Jasper Commerce (JPIM-TSXV) closes first tranche of convertible debenture unit financing.
Jasper Commerce closed the first tranche of its previously announced non-brokered private placement offering of units. The aggregate subscription price for the Units issued in the first tranche totals $636,500, which represents the full offering size of $500,000 plus a partial exercise of the over-allotment option. The Company may close further tranches of the over-allotment up to $113,500 in total. http://bit.ly/3IA0nOw
HS GovTech Solutions (HS-CSE) announces pricing of overnight marketed financing.
The Offering will provide for the issuance of up to 10,811,000 Units at a price of $0.37 per Unit (the “Offering Price”) under the Prospectus Offering, and for the issuance of up to 1,352,000 Units at a price of $0.37 per Unit under the Private Placement, for aggregate gross proceeds of up to $4,500,310. Echelon Capital Markets is acting as lead agent and sole bookrunner, on behalf of a syndicate of agents, including Paradigm Capital. https://bit.ly/41jcEhF
Sophic Capital client Renoworks (RW-TSXV, ROWKF-OTC) and CostCertified enter strategic technology partnership and mutual reseller agreement.
Renoworks Software and CostCertified, a Y-Combinator Alumni, announced a strategic partnership and mutual reseller agreement. The partnership calls for the companies to sell a powerful, all-in-one solution for roofing contractors and exterior remodelers. This joint solution will streamline the process of designing and pricing home renovations, saving contractors time and increasing their efficiency. http://bit.ly/3xuXIz5
Sophic Capital client Legend Power Systems (LPS-TSXV, LPSIF-OTC) continues to grow bookings, pipeline and partners.
Legend Power Systems confirms that SmartGATE bookings continue to grow, and new partnerships are expanding. This includes several smaller initial system purchases as well as follow-on, double digit SmartGATE orders. Additionally, Legend confirms that it is currently assessing a new pipeline representing over 75 million square feet of facilities – a total opportunity potentially worth hundreds of SmartGATEs. http://bit.ly/3k8GowE
Prevu3D raises $13.3 million to help enterprises take “‘first steps”’ into industrial metaverse.
Montréal startup Prevu3D, which provides 3D scanning technologies, has announced the closing of a $13.3 million Series A round. According to Prevu3D, this capital will be used to support the company in accelerating the deployment of its 3D ‘digital twin’ platform for industrial environments as organizations move toward automation and digitization – taking their “first steps” into the industrial metaverse. The funding was led by Cycle Capital, which invests in companies that develop climate tech solutions. It also saw the participation of previous Prevu3D investors Brightspark Ventures and Desjardins Capital. Prevu3D previously raised a $2.5 million seed round in 2020. At that time, Prevu3D claims that nearly 40 million square feet of interior and exterior spaces have been modelled on its platform. http://bit.ly/411GqXU
Croptimistic Technology raises $9.1 million in Series B; acquires CropPro Consulting.
Croptimistic, a Kelowna, British Columbia, Canada-based agriculture technology (AgTech) company, raised $9.1M in Series B funding. The amount of the deal was not disclosed. The Series B was led by Forage Capital Partners. The company, which also acquired CropPro Consulting, a Naicam, Canada-based farm agronomy consulting company, intends to use the funds to fund its continued research and development efforts. https://bit.ly/3YHnUTc
Doctor-backed Clinify secures $2 million to help digitize African medical records.
Michael Omidele founded Calgary-based Clinify in 2020 to help digitize and centralize medical records across Africa’s healthcare system and improve patient outcomes. With $2 million in seed funding from Thin Air Labs, HaloHealth, and Calgary doctors, Clinify began rolling out its electronic medical record (EMR) platform in Africa last fall, starting with Nigeria. Since then, Clinify has deployed its tech with over 10 medical insurance groups, 130 healthcare providers, and 12,000 patients. The company’s equity seed round, which fully closed in September, was led by Calgary’s Thin Air Labs through its first fund. Thin Air Labs provided two-thirds of the $2 million total, with the remainder coming from physician angel group HaloHealth and other undisclosed doctor angels from the Calgary area. The round gives Clinify a $10 million post-money valuation, and brings Clinify’s total funding to $2.1 million, including a $100,000 pre-seed round from 2021. http://bit.ly/3YFz0YS
Global Markets: IPOs, Venture Capital, M&A
FanDuel parent Flutter considers listing on U.S. exchange after record Super Bowl.
FanDuel parent Flutter Entertainment said Tuesday it is considering listing on a U.S. stock exchange. The company said its board is consulting with shareholders to gauge their interest. The development comes two days after a record Super Bowl for betting. FanDuel said it accepted 50,000 bets per minute at its peak, averaging 2 million active users on its platform during the game. FanDuel is the nation’s sports betting market leader and is on track for full-year profitability in 2023, according to the company. Its US$3 billion in annual revenue makes up the biggest segment of Flutter’s overall business. The company also owns Paddy Power and Betfair, well-known gambling platforms internationally. Flutter expects a lot more growth in the United States. It and puts the total addressable market at more than US$40 billion by 2030. That would more than three times bigger than the rest of the world, according Jefferies. Flutter cautioned that its consultation with shareholders is a preliminary step. If the company moves forward, it would need 75% shareholder support in a vote. https://cnb.cx/3I8I4hH
Amid merger and bankruptcy in the West, lidar maker Hesai nails US$190 million IPO.
Last week, China’s lidar maker Hesai raised an upsized IPO in the U.S. at a time the industry is reeling from layoffs, bankruptcy, and consolidation. The Shanghai- and California- based company, which makes the sensing technology critical to autonomous driving and increasingly advanced driver assistant systems, raised US$190 million from its public offering on Nasdaq. Of the nine lidar firms that went public through SPAC, Quanergy filed for bankruptcy protection and Ouster merged with Velodyne. Ouster’s shares have been trading under US$2 since last June, and Innoviz shares are around US$4 apiece. Founded in 2013, Hesai originally intended to go public two years ago. Its application to list on China’s Nasdaq-style STAR board was approved in January 2021 when it planned to raise over 200 million yuan (US$30 million) at a 10 billion yuan valuation. But the IPO plan was withdrawn two months later. Hesai forged ahead with a U.S. IPO amid industry gloominess. Defying worries, its shares jump nearly 11% to US$21 on their first day of trading last Thursday. Its flotation also marked the biggest Chinese IPO in the U.S. since Didi’s in 2021, which subsequently triggered China’s clampdown on overseas listings over data security concerns. http://bit.ly/3I73V9j
Warren Buffett’s Berkshire Hathaway buys even more AAPL stock, ditches most of its TSMC.
Warren Buffett’s Berkshire Hathaway has added to its already-massive holding of Apple stock. In a filing today, the conglomerate revealed that it expanded its stake in Apple by over US$3 billion during Q4 2022. AAPL remains Berkshire’s single largest equity investment. With this expansion, Berkshire Hathaway’s stake in Apple is now worth over US$137 billion. The shares owned by Buffett’s conglomerate represent 5.8% of total AAPL shares outstanding. Its investment in Apple is Berkshire’s largest holding, representing 39% of disclosed assets for Q4 2022. It also received a US$210.6 million dividend check from Apple in Q4 2022. At the same time, Berkshire also decreased its holdings in TSMC, one of Apple’s most important supply chain partners. According to filings, Berkshire reduced its stake in TSMC by a whopping 86%, dropping from 60 million shares down to 8.29 million shares valued at US$617.7 million. http://bit.ly/3EfSrzk
Airbnb posts a record Q4 as travel recovers post-pandemic.
Airbnb is raking in the dough. The company reported a record Q4, beating its previous benchmark both in terms of revenue and net income. In Q4, Airbnb’s revenue grew 24% year over year to US$1.9 billion, according to the company, driven by an uptick in stays and Experiences, Airbnb’s curated selection of tours and events. Nights and Experiences booked increased 20% in Q4 2022 compared to a year ago, the company said, while guests stayed at locations longer. Gross nights booked in Q4 2022 for more than a week – a profitable customer segment – were 40% higher than in Q4 2019. Cross-border trips in Q4 2022 were up 49% year on year, the company said, with outbound travel from the Asia-Pacific region showing the strongest growth globally as China lifted its COVID-19 travel restrictions. Coinciding with the climb, total listings on Airbnb grew to 6.6 million – the highest ever – as the platform added 900,000 active listings year on year. http://bit.ly/3IaJ3hk
Roblox shares soar 27% as gains in users and virtual currency purchases lift quarterly results.
Roblox stock surged as much as 27% to an intraday high of US$45.34 after fourth-quarter results beat forecasts, hitting the highest level since December 2021. In the fourth quarter, per-share losses widened to 48 cents, but that was better than the expected loss of 52 cents. Bookings – revenue derived from in-game purchases of the robux virtual currency – rose 17% to US$899.4 million, beating forecasts for US$881.4 million. January has continued the growth trend, with daily active users rising to 65 million and bookings growth estimated to accelerate to 19%-20%. http://bit.ly/415UCiM
Roku posts flat Q4 year-over-year revenue.
Roku posted roughly US$867.1 million in revenue in the fourth quarter of 2022, flat year over year but higher than the company had forecast. Roku reported a roughly US$250 million operating loss, compared with a small profit a year earlier, reflecting expenses which mounted through the year. Roku’s report showed that the number of active Roku accounts rose 16% to 70 million, while overall streaming hours increased 23%. The company attributed the growth to its original programming, although the streaming firm’s investments appear to have contributed to its free cash flow dropping severely in 2022 compared to 2021. Roku stock, which tanked in 2022 in anticipation of less advertiser demand and inflationary pressure, jumped 12% on Wednesday, to US$63.49. Yet Roku forecast that its net revenue would be around $700 million in the first quarter, down slightly from the first quarter of 2022. Roku also said it was committed to carefully managing its spending in hopes of getting back to profits by next year. The company laid off around 200 U.S. employees in November, reducing its headcount by 7%. https://bit.ly/3IvEUGd
Robinhood sees pop in crypto trading in January.
Trading platform Robinhood said it saw US$3.7 billion in crypto trading volume in January, a 95% increase compared with one month prior. The pop coincides with a 2023 rally in the prices of several cryptocurrencies—bitcoin, for example, is up roughly 46% year to date. To be sure, Robinhood’s crypto trading volume for the month was still down 59% year over year. And the company’s heightened trading levels simply bring it back to around where it was trading before FTX filed for bankruptcy in November. In October, Robinhood saw US$3.5 billion of crypto trading volume, rising to US$5.7 billion in November amidst the FTX meltdown. In December, though, crypto trading volume dropped to just US$1.9 billion. https://bit.ly/3Knt8PL
Cathie Wood’s Ark Invest snatches up US$9.2 million of Coinbase stock after the crypto exchange’s massive January rally.
Cathie Wood’s Ark Investment Management amped up it’s Coinbase holdings after the crypto company’s stock had a huge rally last month. The famed money manager purchased 162,325 shares on Friday, worth around US$9.26 million at the time it disclosed its holdings. Ark owns over US$18 billion worth of COIN across all eight of its exchange-traded funds, making up 3.88% of its total holdings. The money manager’s last purchase of Coinbase shares was on January 11 when Ark bought US$3.3 million worth of the crypto exchange’s stock. Ark has a 4.3% combined stake in Coinbase. The COIN purchase follow an impressive 74% rally for the crypto company in January. The tech-heavy Nasdaq Composite is up over 13% year-to-date. Ark Innovation ETF just logged its best performing month to date, surging 28% in January as well. The gains follow a low-performing year for the fund, which plunged nearly 70% last year. http://bit.ly/3YSusOo
George Soros’ fund reveals it’s betting against Silvergate as the crypto-friendly bank is probed over its ties to FTX.
George Soros’ family office revealed it’s betting against Silvergate Capital as the crypto-friendly bank comes under fire for its ties to FTX. Soros Fund Management bought put options on 100,000 shares of Silvergate, worth US$1.74 million as of December 31, according to a 13F filing. Those who purchase put options are essentially betting that the stock’s price will fall. The fund’s position in put options suggests investors are losing faith in Silvergate. This month, the Department of Justice’s fraud unit launched a probe against the bank for its linkages with collapsed crypto exchange FTX and its trading arm Alameda Research. http://bit.ly/3xwmE9m
Meta Platforms may do more layoffs.
Meta Platforms gave thousands of employees “subpar” ratings in recent performance reviews, The Wall Street Journal reported, noting that the company’s leadership are considering another wave of layoffs amid a weak digital ad market. Meta’s leadership expects more people will leave in the coming weeks and it will consider layoffs if not enough leave, the Journal report said. In November, Meta laid off 13% of its workforce, or 11,000 people. The Information reported in January that Meta’s performance review cycle was the most intense in its history, as managers ratcheted up pressure on the workforce. Leaders told managers that employees who get “meets all expectations” grades have to do better. The Journal report said about 10% of employees got ratings suggesting they were underperforming, although it noted that wasn’t unprecedented for past years. https://bit.ly/413tQYa
Twilio cuts 17% of its workforce just months after previous round of layoffs.
Twilio just announced that it will be conducting a round of layoffs that will impact around 17% of its global workforce. The company will also restructure its internal organization and create two business units — Twilio Communications and Twilio Data & Applications. The company already conducted a round of layoffs in September, 2022. At the time, the company announced that it would lay off 11% of its staff. https://tcrn.ch/3KhPrWI
Tesla recalls 363,000 cars over full self-driving software.
Tesla recalled 362,758 cars on Thursday over the crash risk from its Full Self-Driving software. The software “may allow the vehicle to act unsafe around intersections” and “may respond insufficiently to changes in posted speed limits” according to a filing with the U.S. National Highway Traffic Safety Administration. Tesla can fix the problems that prompted the recall, which includes several models and years of vehicles, through a software update, according to the filing. Recalls are common at Tesla, which issued nine recalls in 2022, including the recall of 1.1 million cars in September over a bug with its automatic windows which put people at risk of getting their fingers pinched. Thursday’s recall came in response to testing and analysis conducted by NHTSA, according to the organization, which said that its investigation into Tesla’s Autopilot software (which is less autonomous and more widely available than FSD) and related vehicle systems “remains open and active.” https://bit.ly/413ocFn
Uber shifts computing work to Oracle and Google cloud.
Uber is moving some of its computing workload from its own servers to those managed by Google Cloud and Oracle, the companies said on Monday, a big win for the two laggards of the public cloud market. The move is a strategic shift for Uber, which since its beginning under co-founder Travis Kalanick has generally avoided using public cloud providers, The Information has previously reported. While the company has offloaded some computing to Amazon Web Services in recent years, it still primarily relied on its own servers. Uber’s smaller U.S. ride-sharing rival Lyft, in contrast, uses AWS to fully power its app. In its announcement with Oracle, Uber CEO Dara Khosrowshahi said the shift would help the company reduce its “overall infrastructure costs” while also helping “maximize innovation.” As part of the Oracle announcement, Oracle will become a global “Uber for Business” client. In a separate announcement about the Google Cloud move, the companies said the move would help Uber “modernize its infrastructure” as well as use Google Cloud’s AI, machine learning and security products. https://bit.ly/3xAmj5M
TikTok’s parent takes on Meta in battle for virtual-reality market.
Two years ago, ByteDance bought Pico, a Chinese startup that makes VR headsets. Pico’s headset shipments have since jumped, turning it into a small but fast-rising No. 2 to Meta in the global market. The company has been spending heavily on that concept. In its latest quarterly results, Meta said there were more than 200 apps on its VR devices that have generated over US$1 million each in sales, although total revenue in Meta’s Reality Labs segment was down 17% in the quarter due to lower Quest 2 headset sales. Meta held 90% of the market share about a year ago – its market share had dropped to about 75%. Market share for Pico more than tripled over the same period to about 15%. No other VR headset maker held more than 3% of the market. Meta’s headset shipments in the third quarter declined 48% from a year earlier, IDC’s data shows. ByteDance’s Pico was the only headset maker to increase shipments, in a market that was estimated to be worth US$4 billion as of 2022. http://bit.ly/41cpXjQ
Apple delays AR/VR headset launch again, now expects to unveil the device at WWDC.
Apple has once again delayed its announcement event for the Apple AR/VR headset. Originally expected to debut in the spring, Apple is now targeting its WWDC conference in June as the new date for the product’s unveiling. That’s a delay of two months compared to the previously-rumored April release date. The headset device, likely branded the “Apple Reality Pro,” will represent Apple’s first hardware venture in the augmented reality and virtual reality market. Apple’s first AR/VR headset is not expected to be a mass consumer hit. The product is expected to be expensive, priced around US$3,000. http://bit.ly/3YVF2nQ
Zoox robotaxis start rolling out on California public roads.
More than two years ago, Amazon subsidiary Zoox unveiled an electric, autonomous robotaxi it built from the ground up. Now, the cube-like vehicle that is loaded with sensors – and not a steering wheel – is starting to roll out on a few public roads in northern California. A solitary Zoox robotaxi made its inaugural launch on public roads over the weekend after the company received a permit from the California Department of Motor Vehicles. Zoox said the vehicle has also passed a self-certification from the Federal Motor Vehicle Safety Standards. Zoox currently tests Toyota Highlander vehicles equipped with its self-driving system on public roads San Francisco, Las Vegas, Foster City, California (near its headquarters) and Seattle. http://bit.ly/413GFBG
Microsoft says Bing can be provoked to respond outside of its ‘designed tone’.
Microsoft has acknowledged reports of Bing’s strange responses to some queries over the past week since the launch of the updated search engine. Some users have reported receiving rude, manipulative and unnerving responses from the AI-boosted Bing. In a new blog post, Microsoft said it’s listening to feedback from users about their concerns about the tone of Bing’s responses. It’s been a week since Microsoft announced its long-rumored integration of OpenAI’s GPT-4 model into Bing, providing a ChatGPT-like experience within the search engine. The new Bing is being tested with a select set of people in more than 169 countries. Microsoft says the new Bing has been mostly positive, with 71% of users giving the AI-powered answers a “thumbs up.” http://bit.ly/3S6eqhQ
Media, Streaming, Gaming & Sports Betting
Tubi reaches 64 million monthly active users as ad-supported streaming grows.
Fox’s free ad-supported streaming TV (FAST) service, Tubi, reached 64 million monthly active users, the company announced today. The last time the company reported its subscriber base was in May 2022, when Tubi had 51 million. When Fox purchased the streaming service in 2020, Tubi then had 25 million monthly active users. Fox recently reported quarterly earnings, which showed significant viewership growth at Tubi. Its total viewing time was up 44% year over year, with over 5 billion hours streamed in 2022. It’s likely Tubi viewership will increase even more since the streamer struck a deal with Warner Bros. Discovery, gaining more than 2,000 hours of WB-branded content. Tubi claims to have the largest free streaming content catalog, with over 50,000 titles and more than 200 live TV channels. http://bit.ly/3KeEwNC
Adtech, Privacy & Regulatory
More than half of Twitter’s top 1,000 advertisers stopped spending on platform, data show.
More than half of Twitter’s top 1,000 advertisers in September were no longer spending on the platform in the first weeks of January, in a striking sign of how far reaching the advertiser exodus has been following Elon Musk’s acquisition of the company. Some 625 of the top 1,000 Twitter advertisers, including major brands such as Coca-Cola, Unilever, Jeep, Wells Fargo and Merck, had pulled their ad dollars as of January. Wells Fargo said it “paused our paid advertising on Twitter” but continues to use it as a social channel to engage with customers. The other brands did not immediately respond to a request for comment. As a result of the pullback, monthly revenue from Twitter’s top 1,000 advertisers plummeted by more than 60% from October through January 25, from around US$127 million to just over US$48 million, according to the data. The data demonstrate the sharp decline of what was once a $US4.5 billion advertising business for Twitter. http://bit.ly/3xtk444
The founder of WallStreetBets is suing Reddit.
The creator of WallStreetBets, the online community that helped send the GameStop stock soaring in 2021, is suing Reddit. In a lawsuit filed on Wednesday, Jaime Rogozinski claims Reddit wrongfully banned him from moderating the subreddit and violated his rights to a trademark. Rogozinski first created r/WallStreetBets in 2012 with the intent of establishing a community for everyday investors who may not know the ins and outs of stock trading. It exploded in popularity around 2020, encouraging traders to buy various “meme” stocks like GameStop and AMC and chastising those with “paper hands” for selling too early. Rogozinski’s suing for damages of at least $1 million, according to Reuters, and asks that Reddit stop using the WallStreetBets name “unless and until” the company reinstates him as the “senior-most moderator” of the WallStreetBets community. Reddit says it plans on responding “directly in court” and will continue to “protect the best interests of the communities and moderators” on the platform. http://bit.ly/3k6UJtz
E-Commerce’s share of total retail flatlined in 2022.
E-commerce sales as a percentage of total retail flatlined in 2022 after rising sharply for several prior years, according to U.S. Census Bureau statistics released Friday. The data underscores the challenge facing an array of companies that rely on growth in online shopping, including small online sellers, big ecommerce firms like Amazon and payment processors like Stripe. While online sales continued to grow last year, physical retail sales grew at roughly the same rate, leaving e-commerce’s share of the total market flat at 14.6% in 2022, the latest report shows. The stagnation follows a period of rapid growth during the pandemic, when e-commerce grew from 11% of total retail sales in 2019 to 13.6% in 2020 and 14.6% in 2021, according to previous census reports. E-commerce giant Amazon built out infrastructure over the past few years based on the assumption that rapid online shopping growth would continue at a breakneck pace even after the pandemic. But that growth has failed to materialize, leaving Amazon with a glut of excess warehouses and delivery stations. It will take Amazon through the end of 2025 to grow into its current fulfillment center capacity, according to a Morgan Stanley analysis published in January. https://bit.ly/4141kFP
Jumia wants to be the “Amazon of Africa.”
But it can’t find the customers. For a subset of Nigerians, shopping on Jumia offers convenience more than anything else. The Lagos-headquartered Jumia, which has a presence in 11 countries and was Africa’s first unicorn, has been the dominant e-commerce player on the continent for more than a decade. However, this dominance and popularity among users have not resulted in profits for the company, which has failed to impress shareholders and tech analysts. In the third quarter of 2022, Jumia clocked 9.4 million orders worth US$66.6 million. But during the same period, the company posted an operational loss of US$43.2 million. Its total active users grew by 3.5% year on year in that quarter, while the number of orders increased by nearly 11%. Before its IPO, Jumia had raised more than US$760 million from marquee investors like Blakeney Management, Goldman Sachs, the MTN Group, and Rocket Internet. In April 2019, Jumia’s shares were listed on the New York Stock Exchange at an initial price of US$14.50 apiece. The stock has lost nearly 70% of its value and trades at around US$4 per stock.. http://bit.ly/3YSZpC7
Fintech, Blockchain & Cryptocurrency
Bakkt to shutter consumer-facing app, focus on B2B crypto services.
Bakkt, a crypto company that was spun out of Intercontinental Exchange, is shutting down its consumer-facing app and plans to focus on selling behind-the-scenes tech to other companies that offer crypto features. The app will officially shut down on March 16 and existing users will be able to access crypto and cash holdings on a new website, Bakkt announced. Following the closure of the app, the company will only allow new users through partners of Bakkt, Chief Sales & Marketing Officer Mark Elliot said in a statement provided by a spokesperson. Bakkt in November said it would acquire custody and clearing firm Apex Crypto, which Bakkt said would help it expand its B2B services. But how well demand from other fintechs to offer crypto services will be a question mark—installment lender Affirm, for example, said last week it was scrapping its crypto product as part of a cost-cutting push. Bakkt went public via a special purpose acquisition company in October 2021. https://bit.ly/3Kj1T90
Ford’s EVs are getting faster charging and more affordable batteries thanks to new chemistry.
Ford announced a US$3.5 billion electric vehicle factory in its home state of Michigan, where it will produce EV batteries with a lithium iron phosphate chemistry that it says are more durable, faster charging, and more affordable than its current lineup of EVs. Ford will develop the LFP batteries alongside China’s Contemporary Amperex Technology Co. Limited (CATL), a global producer of EV batteries – though the automaker stressed that it will own and operate the plant outright through its wholly owned subsidiary and that the Chinese company will only provide “knowledge and services.” The construction project will generate 2,500 jobs for the region, with initial production expected to commence in 2026. Ford claims it is the first automaker to commit to developing two separate battery chemistries for its EVs at the same time: lithium iron phosphate (LFP) and nickel cobalt manganese (NCM). http://bit.ly/3XvELa8
The information and recommendations made available through our emails, newsletters, website and press releases (collectively referred to as the “Material”) by Sophic Capital Inc. (“Sophic” or “Company”) is for informational purposes only and shall not be used or construed as an offer to sell or be used as a solicitation of an offer to buy any services or securities. In accessing or consuming the Materials, you hereby acknowledge that any reliance upon any Materials shall be at your sole risk. In particular, none of the information provided in our monthly newsletter and emails or any other Material should be viewed as an invite, and/or induce or encourage any person to make any kind of investment decision. The recommendations and information provided in our Material are not tailored to the needs of particular persons and may not be appropriate for you depending on your financial position or investment goals or needs. You should apply your own judgment in making any use of the information provided in the Company’s Material, especially as the basis for any investment decisions. Securities or other investments referred to in the Materials may not be suitable for you and you should not make any kind of investment decision in relation to them without first obtaining independent investment advice from a qualified and registered investment advisor. You further agree that neither Sophic, its, directors, officers, shareholders, employees, affiliates consultants, and/or clients will be liable for any losses or liabilities that may be occasioned as a result of the information provided in any of the Material. By accessing Sophic’s website and signing up to receive the Company’s monthly newsletter or any other Material, you accept and agree to be bound by and comply with the terms and conditions set out herein. If you do not accept and agree to the terms, you should not use the Company’s website or accept the terms and conditions associated to the newsletter signup. Sophic is not registered as an adviser or dealer under the securities legislation of any jurisdiction of Canada or elsewhere and provides Material on behalf of its clients pursuant to an exemption from the registration requirements that is available in respect of generic advice. In no event will Sophic be responsible or liable to you or any other party for any damages of any kind arising out of or relating to the use of, misuse of and/or inability to use the Company’s website or Material. The information is directed only at persons resident in Canada. The Company’s Material or the information provided in the Material shall not in any form constitute as an offer or solicitation to anyone in the United States of America or any jurisdiction where such offer or solicitation is not authorized or to any person to whom it is unlawful to make such a solicitation. If you choose to access Sophic’s website and/or have signed up to receive the Company’s monthly newsletter or any other Material, you acknowledge that the information in the Material is intended for use by persons resident in Canada only. Sophic is not an investment advisor nor does it maintain any registrations as such, and Material provided by Sophic shall not be used to make investment decisions. Information provided in the Company’s Material is often opinionated and should be considered for information purposes only. No stock exchange or securities regulatory authority anywhere has approved or disapproved of the information contained herein. There is no express or implied solicitation to buy or sell securities. Sophic and/or its principals and employees may have positions in the stocks mentioned in the Company’s Material and may trade in the stocks mentioned in the Material. Do not consider buying or selling any stock without conducting your own due diligence and/or without obtaining independent investment advice from a qualified and registered investment advisor. The Company has not independently verified any of the data from third party sources referred to in the Material, including information provided by Sophic clients that are the subject of the report, or ascertained the underlying assumptions relied upon by such sources. The Company does not assume any responsibility for the accuracy or completeness of this information or for any failure by any such other persons to disclose events which may have occurred or may affect the significance or accuracy of any such information. The Material may contain forward looking information. Forward-looking statements are frequently, but not always, identified by words such as “expects,” “anticipates,” “believes,” “intends,” “estimates,” “potential,” “possible,” “projects,” “plans,” and similar expressions, or statements that events, conditions or results “will,” “may,” “could,” or “should” occur or be achieved or their negatives or other comparable words and include, without limitation, statements regarding, projected revenue, income or earnings or other results of operations, strategy, plans, objectives, goals and targets, plans to increase market share or with respect to anticipated performance compared to competitors, product development and adoption by potential customers. These statements relate to future events and future performance. Forward-looking statements are based on opinions and assumptions as of the date made, and are subject to a variety of risks and other factors that could cause actual events/results to differ materially from these forward looking statements. There can be no assurance that such expectations will prove to be correct; these statements are no guarantee of future performance and involve known and unknown risks, uncertainties and other factors. Sophic provides no assurance as to future results, performance, or achievements and no representations are made that actual results achieved will be as indicated in the forward looking information. Nothing herein can be assumed or predicted, and you are strongly encouraged to learn more and seek independent advice before relying on any information presented.