After a few weeks of volatility in Canadian capital markets, last week saw a bit of an uptick in activity. That said, we’re hearing investors are pushing back on some richly valued new issues. We’re excited to see MDA (a Canadian company we’ve known as 15 years as sell side equity analysts) could be a public company once again. In the USA, Robinhood has filed confidentially for a US IPO. Both Robinhood & SoFi have indicated they will let retail investors buy into IPOs. We’re also watching Coursera’s IPO, as many influential investors COVID could forever change education. WeWork could go public via a SPAC. In the US too, recent IPO debuts by Vizio and DigitalOcean suggest investors could be more price sensitive with regards to new issues than in the past few months.
Canadian Technology Capital Markets & Company News
Thinkific files preliminary prospectus for initial public offering of subordinate voting shares.
The company has filed with the securities regulatory authorities in each of the provinces and territories of Canada, and received receipt for, a preliminary prospectus for a proposed initial public offering of subordinate voting shares (the “Offering”). The number of subordinate voting shares to be sold and the price per subordinate voting shares have not yet been determined. The Offering is being underwritten by a syndicate of underwriters led by BMO Capital Markets and CIBC Capital Markets as joint bookrunners for the Offering. https://bit.ly/3ffFyJG
MDA Ltd. files preliminary prospectus for initial public offering of common shares.
The gross proceeds of the Offering are expected to be $500 million. The number of common shares to be sold and price per common share have not yet been determined. The Offering is being made through a syndicate of underwriters led by BMO Capital Markets, Morgan Stanley Canada Limited and Scotiabank, as joint bookrunners, with Barclays Capital Canada Inc., RBC Dominion Securities Inc., Canaccord Genuity Corp., CIBC World Markets Inc., National Bank Financial Inc. and Stifel Nicolaus Canada Inc., as underwriters. https://bit.ly/3vZ53Vw
Dialogue Health Technologies Inc. announces pricing of initial public offering.
The Offering consists of a treasury offering of an aggregate of 8,334,000 common shares of the Company at a price of $12.00 per share for aggregate gross proceeds to the Company of approximately $100 million and, if the Over-Allotment Option (as defined below) is exercised, a secondary offering by certain shareholders of the Company (the “Selling Shareholders”) of an additional 1,250,100 common shares of the Company for aggregate gross proceeds to the Selling Shareholders of approximately $15 million. The Toronto Stock Exchange (the “TSX”) has conditionally approved the listing of Dialogue’s common shares, subject to fulfillment by Dialogue of all of the initial listing requirements and conditions of the TSX. The common shares are expected to begin trading on the TSX on March 30, 2021 under the symbol “CARE”. https://bit.ly/31k7nbG
VLCTY Capital Inc. (VCLY.P-TSXV) and BuildDirect enter into letter of intent to complete qualifying transaction and listing on the TSX Venture Exchange.
The Proposed Transaction will be an arm’s length transaction, and, if completed, will constitute VLCTY’s “Qualifying Transaction” (as such term is defined in Policy 2.4 – Capital Pool Companies (“Policy 2.4”) of the TSX Venture Exchange (the “TSXV”) Corporate Finance Manual. https://bit.ly/39mCR5i
BIGG Digital Assets Inc. (BIGG-CSE) announces $25 million bought deal financing.
The company has entered into an agreement with a syndicate of underwriters led by PI Financial Corp. (the “Lead Underwriter”) and including Canaccord Genuity Corp., and Echelon Wealth Partners (collectively with the Lead Underwriter, the “Underwriters”), pursuant to which the Underwriters have agreed to purchase, on a bought deal basis, 12,000,000 units of the Company (“Units”) at a price of $2.10 per Unit for gross proceeds of $25,200,000 (the “Offering”). Each Unit is comprised of one common share (each a “Common Share”) and one-half Common Share purchase warrant (each such full warrant, a “Warrant”). Each Warrant will entitle the holder thereof to purchase one Common Share at a price of C$2.70 for a period of 24 months following the closing of the Offering. https://bit.ly/3tViZhy
Alithya (ALYA-TSX) to acquire R3D Conseil and sign $600 million in commercial agreement.
This transaction includes annual minimum volume commitments totalling approximately $600 million in combined revenues during the initial 10-year term commercial agreements with Québecor and Beneva (via its subsidiary, La Capitale), two of R3D Conseil’s indirect principal shareholders. Subject to the conditions and adjustments set out in the purchase agreement, the purchase price is evaluated at $76.0 million (excluding the assumption of $8.5 million in debt) and is payable by the issuance of up to 25,469,535 class A subordinate voting shares of Alithya to R3D Conseil shareholders on the closing date, which will represent approximately 30% of Alithya’s issued and outstanding shares following the closing of the transaction. The purchase agreement has been negotiated at arm’s length by and between the parties’ representatives. https://bit.ly/3w3ihRi
Mogo (MOGO-TSX, MOGO-NASDAQ) to enter $4+ trillion Canadian Wealth Management industry with acquisition of leading saving and investing app, Moka Financial Technologies Inc.
Will increase Mogo’s member base to more than 1.7 million with addition of Moka’s more than 500,000 members. Acquisition will form core of MogoWealth, leveraging Moka’s investing platform & team, which includes over $250 million of AUM along with registered portfolio management capabilities throughout Canada & Europe. Will accelerate planned launch of Mogo’s free stock trading solution, further expanding Mogo’s digital wallet capabilities. The $64 million all-stock transaction will bring new Mogo shareholders including Desjardins Capital, National Bank of Canada and Ferst Capital Partners. https://bit.ly/3cs1akb
Mogo (MOGO-TSX, MOGO-NASDAQ) files mixed shelf prospectus ahead of expiry of existing shelf prospectus.
The Prospectus, when made final and effective, will enable Mogo to make offerings of common shares, preferred shares, debt securities, warrants to purchase common shares, preferred shares or debt securities, or any combination thereof (collectively, the “Securities”) of up to an aggregate offering price of US$500 million at any time during the 25-month period that the Prospectus remains effective. https://bit.ly/3d69aXa
Engine Media (GAME-TSXV) files final base shelf prospectus.
The prospectus and registration statement allows the Company to offer up to US$150 million of common shares, preference shares, warrants, subscription receipts, debt securities, units, or any combination thereof (“Securities”) during the 25-month period that the shelf prospectus is effective. https://bit.ly/3w2Emzs
Dye & Durham upsizes credit facility to $700 million.
The company announced that it has amended its existing financing arrangement, increasing the Company’s total borrowing capacity to $700 million, comprised of a term loan of $245 million and a revolving facility of $455 million. The entire financing arrangement now matures on September 25, 2024. Currently, $245 million of the term loan is drawn, and the full amount of the $455 million revolving facility is available. https://bit.ly/39eECS9
Converge Technology Solutions Corp. (CTS-TSX) announces increase to credit facility.
The company gained approval to increase its ABL credit facility from $140 million to $190 million in an agreement with a syndicate of banks led by CIBC. “Upon strengthening our balance sheet and realizing significant interest cost savings throughout 2020 as exemplified by our recent earnings release, we remain enthusiastic to exercise the accordion feature of our credit facility,” stated Shaun Maine, CEO of Converge. “The increase of $50 million will allow Converge to continue our plans for strategic growth and investment into our acquisition-based model.” https://bit.ly/3vWwdwm
FinTech startup Beanworks to be acquired by Quadient for $104 million.
Vancouver-based FinTech startup Beanworks is set to be acquired by French enterprise company Quadient for $104 million. The all-cash deal will see Quadient acquire a 96 percent stake in Beanworks. A statement from Quadient noted that “two key leaders” from Beanworks will retain a minority stake in the company, but the names of those individuals were not disclosed. Quadient said it also has an option to acquire 100 percent of the company “in the coming years.” Beanworks was founded in 2012 and approximately 90 employees. According to Quadient, Beanworks saw 70 percent year-over-year revenue growth in 2020 and is expected to achieve revenue of approximately $10.4 million by the end of 2021. https://bit.ly/3u2Ixtl
Travel startup Hopper raises $213 million Series F round.
Montréal-based travel startup Hopper has closed a $213 million Series F round of funding led by Capital One. Hopper, which was founded in 2007, allows consumers to book flights and hotels on its mobile app. In addition to the funding round, Hopper is also partnering with Capital One to power the financial organization’s travel-booking mobile app for cardholders. Participation in the Series F round also included new and existing investors GS Growth, Inovia Capital, WestCap Group, and Citi Ventures. The financing values Hopper at close to US$2 billion, according to The Globe and Mail. This is reportedly close to double the valuation the startup had after “quietly” raising a US$70 million round in 2020. https://bit.ly/3lWk5qL
Deloitte spin-out company Arteria AI raises $13.7 million Series A round.
Toronto-based Arteria AI, which applies artificial intelligence to the drafting, negotiation, and analysis of contracts, has raised a $13.7 million Series A round of funding. This represents the company’s first fundraising round. Arteria AI is led by CEO Shelby Austin, who previously led Deloitte’s Omnia AI business. The investment, originally targeted at US$8 million was led by Information Venture Partners and Illuminate Financial Management, with participation from Golden Ventures and StandUp Ventures. Arteria plans to use the new funds to build out its product, sales, and delivery on a global basis. https://bit.ly/3fcVyfE
Virtual live learning platform Disco raises $6 million seed round.
Toronto-based Disco, which has developed a platform allowing users to build live virtual learning experiences, has raised an oversubscribed $6 million seed round of funding, as the market for virtual learning experiences continues to see traction. With this investment, Disco has raised approximately US$5 million to date. Investors in the round included Quiet Capital, Golden Ventures, Inovia, and GSV, as well as a number of angel investors, including Wattpad co-founder Ivan Yuen, Shopify’s Satish Kanwar and Brandon Chu, and Clearbanc’s Michele Romanow. The COVID-19 pandemic has caused a surge in demand for online learning. Beyond K-12 and post-secondary edtech products, recent skill-building platforms like Skillshare and Masterclass are appealing to those looking to hone their skills or learn new ones. https://bit.ly/3lVEhc1
Exact Imaging secures $5.1 Million in financing from BDC Capital and EDC.
The company, a provider of high resolution micro-ultrasound systems enabling real-time imaging and biopsy guidance for the prostate, announces $5.1 million in financing provided by BDC Capital, through the Bridge Financing Program, and Export Development Canada (EDC). https://bit.ly/3smtpX6
High Tide acquires leading E-commerce retailer smoke cartel.
According to the company, it now operates both the largest and second largest e-commerce platforms for consumption accessories in the world1 with a combined total of 33 million site visits in 2020. https://bit.ly/3w4MiQM
LEAF Mobile to launch NFTKit and offer non-fungible tokens as prizes in select games.
East Side Games, is set to launch a non-fungible token (“NFT”) game creation toolset called NFTKit for its IdleKit platform. The company plans to release the first offering of NFTs as prizes, within select games, the week of April 20th, 2021. https://bit.ly/3rpGkq1
BlackBerry launches $50 million fund to work with AutoTech startups.
BlackBerry has launched a $50 million fund to help data-driven automotive ecosystem startups bring their tech to market using BlackBerry’s intelligent vehicle data platform. In addition to supporting AutoTech startups with go-to-market, the BlackBerry IVY Innovation Fund aims to accelerate the expansion of BlackBerry’s IVY ecosystem. The company stated that, through the fund, it hopes to support “the next generation of intelligent connected vehicles.” The fund will initially allocate up to $50 million to invest in startups developing data-driven solutions that could benefit from BlackBerry IVY’s artificial intelligence (AI) insights as well as support from BlackBerry and AWS. https://bit.ly/2PydhDq
Venture Capital investment into Alberta technology companies doubles in 2020.
Alberta: $455 million across 51 deals in 2020 (up 100% from $227 million, up 31% from 39 deals in 2019). Alberta: Average deal size $8.9 million (up 53% over 2019 deal size average of $5.8 million). https://bit.ly/3lTfvJE
TheScore (SCR-TSX, SCR-NASDAQ), valued at US$1 billion, is playing underdog in U.S. sports gambling and public markets.
Build it slow. That’s how media company theScore wants to establish its gambling asset as the Canada-based company is now fully active on the U.S sports betting and public markets landscape. “That’s how we built our success with our TV network in Canada, and that’s how we built our success with the app,” said John Levy, the company’s CEO. Canadians place over US$7 billion in illegal wagers as sporting gambling in the country is mainly limited to horse racing, according to Bloomberg. TheScore says it achieved an all-time record quarter for its media revenue, generating US$10.6 million in the first quarter of 2021. As for its stock, Chad Beynon, an analyst at Macquarie Securities, labeled it outperform. He said theScore plans to own its sportsbook tech and that could help with long-term revenue growth. TheScore has already been mentioned among early candidates for a potential acquisition. The company told CNBC it doesn’t comment on rumors or speculation when asked about acquisition rumors. https://cnb.cx/3cuFjJa
Amazon is opening a new game studio in Montreal led by Rainbow Six Siege developers.
The company on Tuesday announced the new studio’s Montreal-based team, which will create original AAA games with an initial focus on a new online multiplayer title. Amazon Games’ Montreal studio is its fourth studio, with three other locations based in Seattle, San Diego, and Orange County. https://bit.ly/3w3uTYE
EMERGE Commerce (ECOM-TSXV) related: Online pandemic shopping could shift retail industry.
City News interview, featuring EMERGE Commerce, CEO Ghassan Halazon highlighting changing consumer habits, which bode well for ecommerce, after the end of COVID. https://bit.ly/39AVpz9
Canadian investors at risk as number of unregulated cryptocurrency exchanges explodes.
When Quadriga founder Gerald Cotten died in December 2018, over 76,000 investors lost a combined $169 million, money that couldn’t be recovered from the unregulated Vancouver-based cryptocurrency platform largely as a result of what an Ontario Securities Commission investigation found was fraudulent trading. https://bit.ly/3rlHGCk
Global Markets: IPOs, Venture Capital, M&A
Robinhood has filed confidentially for a US IPO.
Robinhood Markets confidentially filed for an initial public offering with the US Securities and Exchange Commission, Bloomberg first reported on Tuesday. The company confirmed the report in a blog post. Robinhood, the trading app popular among retail investors, selected Nasdaq as the venue for its listing, according to Bloomberg. It’s also said to be keeping its listing plans open to change. Robinhood has been eyeing an IPO since as early as 2018. The company had more than 13 million users at the end of 2020. Robinhood achieved an US$11.7 billion valuation in a funding round last year. It also raised financing this year that will convert to equity upon the completion of an IPO, Bloomberg reported in February. A first tranche will convert at the lower of a US$30 billion valuation or a 30% discount to the IPO, with the second at the lower of the 30% IPO discount or a US$33 billion valuation, according to Bloomberg. Robinhood hired Goldman Sachs in December to lead its IPO. https://bit.ly/31naYpr
Robinhood aims to allow users to buy into IPOs.
Robinhood Markets Inc is building a platform to “democratize” initial public offerings (IPOs), including its own, that would allow users of its trading app to snap up shares alongside Wall Street funds, according to people familiar with the matter. The move could further erode Wall Street’s grip on stock market flotations. It would be easier to implement for Robinhood’s own IPO, given how companies and their investment bankers tightly control allocations to investors in new listings. Currently, Robinhood users and other amateur traders cannot buy into stock of a newly listed company until its shares start trading. Since shares often trade higher when they debut, big funds that get allocations in the IPO have an advantage. The average first-day trading pop on U.S. listings of businesses in 2020 was 36%, according to data provider Dealogic. Robinhood plans to carve out a chunk of its shares on offer in its IPO for its 13 million users, and to use technology it is building to administer this part of the offering, the sources said. While Robinhood’s technology would be new, the concept of reserving shares for users is not. Deliveroo Holdings Plc, the Amazon.com Inc-backed food delivery firm that announced plans this month to list in London, is doing this, although a third-party provider is administering the process. https://reut.rs/3rAfyeR
Fintech firm SoFi to allow users to buy directly into IPOs.
Financial technology firm SoFi announced on Friday that it will be allowing its users to directly invest into initial public offerings, an opportunity usually reserved for institutional investors. Retail traders at present are not able to buy stocks of newly listed companies until they start trading, unlike Wall Street investors or high net-worth individuals. SoFi’s new initiative will be considered a win for retail traders as shares often trade higher when they debut in what is commonly known as a first-day pop. The announcement of SoFi comes a day after Robinhood said it is looking to allow its users to also buy directly into IPOs, including its own upcoming public debut. https://bit.ly/39odcJx
Coursera says it expects IPO to price between US$30 and US$33 a share.
Coursera expects to sell more than 15 million shares in its upcoming initial public offering for between US$30 and US$33 apiece, it said in a filing Monday. The education technology company announced plans to go public earlier this month, listing Goldman Sachs and Morgan Stanley among its underwriters. The company said the COVID-19 pandemic “sharply increased” the need for online learning last year, and the company has launched several initiatives to mitigate the pandemic’s impact on learning. The company reported reported a US$66.8 million loss on revenue of US$293.5 million in 2020, compared with a US$46.7 million loss on revenue of US$184.4 million in 2019. Coursera plans to list on the New York Stock Exchange under the symbol COUR. https://on.mktw.net/3lSaFfM
WeWork lost US$3.2 billion in 2020. WeWork lost US$3.2 billion last year as the pandemic hit occupancy rates in its buildings, according to documents obtained by the Financial Times. The loss represented a slight narrowing from the US$3.5 billion WeWork lost in 2019, as the company laid off thousands of employees over the past year. But the company struggled to fill its buildings due to the pandemic. Its occupancy rate fell to 47% at the end of 2020, from 72% at the start of the year, the FT reported. WeWork is discussing a merger with BowX Acquisition Corp., a blank-check company, and the two sides are trying to line up US$1 billion from institutional investors as part of the deal, which would value WeWork at US$9 billion, including debt. The company is painting a rosy picture of its future. WeWork has said in presentations to investors that occupancy levels wold hit 90% by the end of 2022 and it would pull in US$7 billion in revenue by 2024, up from US$3.2 billion last year. https://bit.ly/3foL1hD
BowX jumps on reports it will take WeWork public via SPAC merger.
The blank check company that is set to take WeWork public jumped as high as 6.77% in early trading on Friday. BowX Acquisition Corp traded above US$10.37 a share Friday after an announcement that it will combine with WeWork in a deal that values the co-working company at US$9 billion. The Wall Street Journal first reported the merger Friday morning. WeWork confirmed the deal in a press release. The transaction will be funded with BowX’s $483 million of cash in trust, WeWork said, in addition to an $800 million private investment group groups including Insight Partners, funds managed by Starwood Capital Group, Fidelity Management & Research Company LLC, Centaurus Capital, and funds and accounts managed by BlackRock. https://bit.ly/3u5MSMn
Online real estate platform Compass eyes US$10 billion valuation in US IPO.
The online real estate platform Compass is eyeing a US$10 billion valuation in an IPO on the New York Stock Exchange, according to an amended S-1 Prospectus filed on Tuesday. Compass is now set to offer 36 million Class A shares to the public between US$23-US$26, according to the filing. Compass filed its original S-1 Prospectus on March 1. Compass has done over US$300 billion in gross transaction volume through its online real estate platform since 2012 while working with 19,000 real estate agents in the residential market across the country. https://bit.ly/3rw4WgF
ThredUp stock opens 30% above its IPO price, to value the company at US$1.7 billion.
Shares of ThredUp Inc. soared out of the gate Friday, as the secondhand e-commerce site’s stock open 30.4% above its initial public offering price. The first trade for the stock was at US$18.25 at 11:57 a.m. Eastern for about 712,000 shares. The company said late Thursday that its IPO priced at US$14 a share, at the high end of the expected range of between US$12 and US$14 a share, as the company sold 12 million shares to raise US$168 million. The company went public as investor demand for IPOs have waned recently, as the Renaissance IPO ETF has shed 6.3% year to date while the S&P 500 has gained 4.8%. https://on.mktw.net/3lSc3Py
UiPath files for IPO after being valued at US$35 billion in latest funding round.
UiPath Inc. filed for an initial public offering on Friday with plans to list on the New York Stock Exchange under the ticker symbol ‘PATH.’ The maker of software for automation systems said it aims to raise US$1 billion, although that is likely a placeholder sum until terms are set. There are 22 banks underwriting the deal, led by Morgan Stanley and JP Morgan. Proceeds of the deal will be used for general corporate purposes, which could including acquisitions. The company had a loss of US$92.4 million in its fiscal year to end Jan., narrower than the loss of US$519.9 million posted in the year-earlier period. Revenue rose to US$607.6 million from US$336.2 million. UiPath was valued at US$35 billion in its most recent funding round from Feb. 1. https://on.mktw.net/3fgNDOr
Vizio shares fall 9% on debut.
TV maker Vizio suffered an inauspicious public debut on Thursday, with its shares falling 9% from the IPO price, a sign that investors are not convinced that the company can be the next Roku. Vizio said in its IPO filing that it expects future profit growth to come from its “platform” business which generates advertising sales from marketers using Vizio’s smart TV platform. That’s the model Roku has pursued hugely successfully. Seventy percent of Roku’s revenue now comes from advertising, which is higher-margin revenue than what comes from selling devices. Roku’s stock has soared in the past year. Selling TV sets still makes up the bulk of Vizio’s revenue, however. The stock reaction—after Vizio priced the IPO at the low end of the range—suggests investors are skeptical that will change. Vizio shares closed at US$19.10, giving the company a market capitalization of US$3.5 billion. https://bit.ly/3cnieb7
DigitalOcean raises US$775 million in IPO, but shares drop 10%.
Shares of DigitalOcean, a small cloud provider that competes with giants like Amazon Web Services and Microsoft, dropped nearly 10% in their first day of trading, after the company raised US$775 million in its initial public offering. The results suggest that investors aren’t sure about DigitalOcean’s prospects in a market dominated by larger companies. While DigitalOcean’s revenue grew 25% last year to more than US$318 million, the 10-year-old firm lost US$43.6 million last year and US$40.4 million the year before, according to its IPO filing. But DigitalOcean believes it can succeed by making its product portfolio and pricing easy for customers to understand. Customers of large cloud providers often find it difficult to figure out which services to use, and many have struggled to gauge the costs of using cloud services. This approach has helped DigitalOcean gain traction with smaller companies and developers, but investors may need more convincing. https://bit.ly/2P4nCau
Chinese ride-hailing giant Didi eyes US IPO at US$100 billion valuation, report says.
China’s top ride-hailing company Didi Chuxing is eyeing the US for its initial public offering, targeting at least a US$100 billion valuation to capitalize on the post-pandemic rebound, Reuters first reported. The Chinese firm is said to be weighing its options between New York and Hong Kong for its IPO. However, two sources told Reuters that there were concerns of tighter regulatory scrutiny of the company’s business operations in the Asian city, such as its use of unlicensed vehicles and part-time drivers. Didi in 2019 was fined by Shanghai authorities for using unlicensed vehicles. Moreover, a source told Reuters that an IPO in New York is not only more predictable but also offers more capital. https://bit.ly/2NXi8xD
Discord in talks to sell to Microsoft.
Discord, the group messaging app that is especially popular with gamers, is in talks to sell to Microsoft, according to Bloomberg. The report, which followed an earlier story on Monday by VentureBeat that said Discord was fielding acquisition offers, notes that Microsoft would pay more than US$10 billion for the startup. That would be a jump above the US$7 billion valuation it received in a Series H round of financing a few months ago. Bloomberg reports that Discord recently reached out to Microsoft about a deal and that it has met with Phil Spencer, the head of Xbox, after talking to Amazon and Epic Games in the past. Discord’s revenue tripled last year to US$130 million by selling subscriptions to unlock additional features for its 140 million monthly active users. Aside from its Xbox gaming business, Microsoft is a logical suitor for Discord given the appetitive it has recently shown for large, consumer tech deals by holding talks to buy TikTok and Pinterest. But there’s also a chance that Discord, which added its first chief financial officer this month, decides to call off the talks and stay private longer or publicly list its shares. “Discord is more likely to go public than sell itself,” Bloomberg notes. In 2018, when it was valued at just US$1.6 billion, Discord hired a bank to help it consider acquisition offers. Not selling then turned out to be a smart decision. https://bit.ly/3tZd7nC
Fortnite-owner Epic Games worth US$28 billion as fundraising taps lockdown bonanza.
The owner of Fortnite and Houseparty, two of the pandemic’s biggest technology smash hits, is closing in on another large injection of funding that will value it at about US$28 billion (£20.2 billion). The company was valued at USS$17.3 billion after a US$1.78 billion capital-raising announced last July, which included a US$250 million contribution from the Japanese entertainment giant Sony. The game has more than 350 million accounts worldwide and 2.5 billion friend connections. Epic Games boasts an all-star share register including names such as BlackRock, Fidelity Management & Research, the private equity group KKR, leading tech investor Lightspeed Ventures and the Ontario Teachers’ Pension Plan. https://bit.ly/3fh8AbQ
Dolphin Entertainment stock more than doubles after forming new NFT division.
Shares of Dolphin Entertainment Inc. more than doubled in active morning trading Tuesday, after the entertainment marketing and content development company said it was entering the non-fungible token (NFT) market. Trading volume ballooned to 13.5 million shares, compared with the full-day average of about 571,000 shares over the past 30 days, according to FactSet. The company said it has formed a new division dedicated to designing, producing, releasing and promoting NFTs for the company and its clients, within the film, TV, music, gaming, foods and technology industries. “NFTs, whether as digital art in their own right, or as collectibles, or simply as promotional items, have entered the realm of pop culture and entertainment, which is where Dolphin lives,” said Chief Executive Bill O’Dowd. “We expect several upcoming projects and partnerships that will combine our creative and marketing expertise to bring exciting offerings to the NFT marketplace.” https://on.mktw.net/31nTaL2
ByteDance acquires gaming studio Moonton at around US$4 billion valuation.
ByteDance said on Monday its video games unit Nuverse has agreed to acquire Shanghai-based gaming studio Moonton Technology, as it seeks to further expand into the video games business. The deal values the gaming studio at around US$4 billion, two sources told Reuters. The acquisition of the video games studio come as ByteDance, the owner of TikTok and the similar Chinese short video platform Douyin, has made sizeable inroads into the video games business, putting it in direct competition with China’s Tencent. Tencent, China’s biggest video games and social media company, made a bidding for Moonton but the offer was matched by ByteDance last week, two sources familiar with the situation told Reuters. https://reut.rs/3w3pYHb
Box explores sale amid pressure from Starboard.
U.S. cloud services provider Box Inc is exploring a sale amid pressure from hedge fund Starboard Value LP over its stock performance, according to people familiar with the matter. The sources requested anonymity because the matter is confidential. Box declined to comment. Box shares jumped as much as 17% on the news to US$26.47, giving the company a market value of about US$4.3 billion. DA Davidson analyst Rishi Jaluria wrote in research note on Monday afternoon that Box could fetch more than US$34 per share in a sale. Reuters reported last month that Starboard was preparing to launch a board challenge against Box unless it took steps to boost value for shareholders. It has privately expressed disappointment that the company has failed to capitalize on the work-from-home trend during the COVID-19 pandemic, as many of its cloud computing peers have done. https://reut.rs/3fmKk8j
Chipotle invests in driverless delivery company, Nuro.
Chipotle Mexican Grill Inc. said Thursday that it has invested in Nuro, an autonomous delivery company. Chipotle didn’t offer financial details, but says it’s the first “significant” third-party investment since Brian Niccol became chief executive in 2018. “Nuro could change the traditional delivery model and we believe consumers are going to continue to seek options and additional access points for how and where they enjoy their food,” said Curt Garner, Chipotle’s chief technology officer, in a statement. Chipotle notes that its digital business soared 174% in 2020, with about half coming from delivery. Nuro says its mission is to “accelerate the benefits of robotics for everyday life.” In December, it became the first company to be authorized to operate a driverless delivery business in California. https://on.mktw.net/3rrzP66
U.S. tech companies use their expensive stock to pay for acquisitions.
Cash may be king, but stock is queen in the land of technology mergers and acquisitions during a pandemic-fueled tech boom. Close to half the U.S. deals in the sector included a stock consideration last year, the highest percentage since 2016, versus only 27% in 2019, according to financial data provider Refinitiv. By comparison, 39.5% of deals across all sectors used stock last year. The tech trend continued into 2021 as half of the deals in the sector announced in the first quarter also used stock. Stock deals can also come with tax benefits for the acquisition target. Deal proceeds are not taxable at the corporate level in the United States as long as stock makes up at least 40% of the purchase price consideration. Dealmaking in the U.S. technology sector has blossomed during the pandemic. The first quarter of 2021 has seen the highest tech deal volume ever, with over 700 deals totaling US$155 billion announced. Tech transaction volumes in 2020 jumped by 72% to US$383 billion, Refinitiv data shows. https://reut.rs/3dcsaDz
Samsung’s new partnership offers another glimpse of a drone delivery future — in only one Irish town.
In Oranmore, a small town in County Galway, Ireland, you can now get a taste of a possible, instantly-gratifying drone delivery future. In a newly announced partnership with Irish drone delivery company Manna, Samsung is promising delivery of its smaller electronics like phones and smart watches “within three minutes” when ordered by someone in Oranmore from Samsung’s Irish online store. Manna uses “custom-developed aerospace drones” to complete deliveries, according to Samsung’s announcement. The drones’ ability to travel at speeds over 60 kilometers per hour (around 37 miles per hour) seems to be what guarantees those aggressive delivery times, though only operating within a two-kilometer radius from their dispatch center probably helps too. https://bit.ly/3srB5Yf
Apple headset to have ultra-short focal length lenses and weigh less than 150 grams.
Following a recent report mentioning that Apple’s rumored mixed reality headset will feature advanced eye tracking, reliable analyst Ming-Chi Kuo said in a research note obtained by 9to5Mac that Apple has been working on hybrid ultra-short focal length lens aiming to keep the weight of the headset under 150 grams. As mentioned by Kuo, current virtual reality headsets typically weigh over 300 grams and have a bulky form factor, which is something Apple wants to solve for its own headset. Apple’s VR device is expected to adopt Fresnel’s hybrid ultra-short focal length lens that have improved field of view, as well as reduced weight and thickness. According to previous rumors, Apple’s mixed reality headset is expected to be launched sometime in 2022 costing as much as US$1000. However, Kuo argues that the product’s shipment could be delayed due to supply issues. https://bit.ly/3rvUdTr
Researchers successfully store ‘data’ inside DNA of living bacteria.
DNA has been the major information storage medium for biology and holds great promise as the next-generation high-density data medium in the digital era. At present, the vast majority of DNA-based data storage approaches rely on in vitro DNA synthesis. Thus, there are limited techniques to encode digital data into the chromosomes of living cells in a single step. Presently, researchers at Columbia University have pushed the idea much further, by writing data into the DNA of living bacteria, according to Science reports. To store data inside DNA, it has to be converted by a DNA synthesizer from its binary format of ones and zeros into organic code: combinations of the molecule’s four bases including adenine, guanine, cytosine, and thymine. Unfortunately, the more extended this code is, the less accurate the synthesizer work. As a workaround, researchers break up the code into chunks. DNA sequencers then have to piece them together again to access the data. https://bit.ly/2P8PXfy
Amazon has received FDA authorization for a COVID-19 test that can be carried out at home using nasal swabs.
Amazon has received approval from the Food and Drug Administration (FDA) for a COVID-19 test, developed by its subsidiary STS Lab Holdco, according to an FDA filing. Individuals will be able to carry out the nasal-swab test alone at home or with help from a professional. The company plans to use the test among its employees as part of its effort to bolster its COVID-19 preparedness and response program, according to a different FDA document.
Media, Streaming, Gaming & Sports Betting
Sensor Tower: PUBG Mobile has grossed more than US$5 billion.
PUBG Mobile has earned US$5.1 billion in lifetime sales, according to market analyst Sensor Tower. This comes as Tencent itself touts that the battle royale game has passed the 1 billion downloads mark. That means that PUBG Mobile is earning about $5 for every download. Last year was a big one for the game, as it earned US$2.7 billion in 2020 alone. All of gaming saw a boost during the pandemic, and that was especially true for multiplayer and social titles like PUBG.
Adtech, Privacy & Regulatory
SEC starts implementing law that risks Chinese stock delistings.
The threat of Chinese stocks being kicked off U.S. exchanges is gaining traction, with the Securities and Exchange Commission starting to implement a tough law passed at the end of the Trump administration. In a Wednesday statement, the SEC said it’s taking initial steps to force accounting firms to let U.S. regulators review the financial audits of overseas companies. The penalty for non-compliance, as stipulated by the law Congress approved in December, is ejection from the New York Stock Exchange or Nasdaq for any business that doesn’t allow their audit to be inspected for three years. https://bloom.bg/39l8jRz
Fintech, Blockchain & Cryptocurrency
Institutional crypto managers are holding a record amount of digital assets, despite a decline in US inflows, CoinShares says.
Institutional crypto managers are now managing a record US$57 billion in assets, according to digital asset investment firm CoinShares. Last week, net inflows totalled US$73 million as minor outflows were offset by incoming investments, a weekly report by the company showed. Grayscale Investments, the owner of the world’s largest bitcoin fund, still manages over three quarters of that record total, with around US$44.6 billion, well ahead of CoinShares, which has the second-largest holding, with just shy of US$5 billion in assets under management. The vast majority of inflows in the latest week went into bitcoin, totaling US$85 million. Ethereum’s ether token and Polkadot were left far behind in second and third place respectively, according to the report. Ether saw inflows of US$8 million and Polkadot, US$2 million. Volumes traded in bitcoin-based investment products eased back by US$387 million to US$713 million a day, compared to a daily US$1.1 billion for 2021. https://bit.ly/3fiU8QL
Hedge fund manager Anthony Scaramucci’s SkyBridge Capital is the latest to file for a bitcoin ETF.
Anthony Scaramucci’s SkyBridge Capital has teamed up with investment firm First Trust Advisors to apply for regulatory approval for a bitcoin exchange-traded fund. According to the March 19 filing, the objective of the First Trust SkyBridge Bitcoin ETF is to buy and sell bitcoin in a manner that the total value of the cryptocurrency is as close to 100% of the net assets “as is reasonably practicable to achieve.” The ETF will seek to list its shares on the New York Stock Exchange Arca, which specializes in exchange-traded listings. A ticker symbol has not yet been assigned to the fund. Scaramucci’s SkyBridge launched a bitcoin fund in December, saying that he expected an “avalanche” of institutional investors to buy crypto in 2021. It only allows accredited investors to subscribe to it for a minimum investment of US$50,000. https://bit.ly/31AZyyF
Snoop Dogg and Lionel Richie jump in on NFT craze as Crypto.com launches a token marketplace.
Snoop Dogg, Lionel Richie and Boy George are moving into the world of non-fungible tokens, having signed up to produce work for cryptocurrency exchange Crypto.com’s new NFT marketplace. It is the latest example of the craze for the crypto technology, following the sale of a US$69 million NFT artwork earlier in March and the popularity of the NBA’s Top Shot token market. Crypto.com – a cryptocurrency exchange with more than 10 million global users – will launch an NFT platform on Friday as it seeks to capitalize on the trend, the company said on Tuesday. It will feature sports, art and music NFTs from the likes of the Aston Martin Cognizant Formula One racing team, online artist BossLogic, and TikTok sea shanty star Nathan Evans. Lionel Richie – one of the best selling music artists of all time – will team up with digital artist Klarens Malluta to produce an NFT for cryptocurrency exchange’s invite-only platform. Snoop Dogg, who has previously tweeted enthusiastically about meme cryptocurrency Dogecoin, will also produce work for the platform. UK 1980’s pop icon Boy George will also create content for the platform, saying: “Digital art is a new emotion.” https://bit.ly/3ssCIVC
The global auto plants now idle as chip supplies dry up.
Many of the world’s biggest automakers are suspending operations at their factories in Asia, Europe and North America due to a persistent shortage of semiconductors that was exacerbated by a fire at a key chip-producing plant over the weekend. Ford Motor Co., Toyota Motor Corp., Volkswagen AG and Honda Motor Co. are among those affected by problems with the supply of semiconductors, which are used in vehicles to manage and monitor everything from engine and driving performance to air-conditioning and entertainment systems. https://bloom.bg/3tNB1lQ
Intel spending US$20 billion to build two new chip plants.
Intel is spending US$20 billion to build two new chip fabrication plants in Arizona while also rekindling plans to provide chip manufacturing services to other companies in the U.S. and Europe, CEO Pat Gelsinger said in his first major news conference since taking the helm last month. Gelsinger also said Intel won’t be separating its chip manufacturing operations from its chip design, as some investors have called for it to do. And Intel’s efforts to develop 7-nanometer chips, which have encountered numerous delays, now appear to be back on track. The moves–which sent Intel shares up more than 7% in after-hours trading–show how Gelsinger is addressing key questions about Intel’s future. The event also included appearances from Microsoft CEO Satya Nadella and IBM CEO Arvind Krishna, underscoring how Intel’s longtime business partners are still on board after several years of turmoil. While Gelsinger described Intel’s efforts seven years ago to provide chip manufacturing services to other companies as “somewhat weak,” he said things will be different this time around. “The market is really different today, and there is strong demand for semiconductors,” he said at the event. https://bit.ly/2Pbc315
Elizabeth Warren and AOC want to spend US$500 billion to create 1 million green infrastructure jobs.
President Joe Biden campaigned on an infrastructure bill focused on job creation and climate change. And now, progressive lawmakers are looking to put his plans into action. On Thursday, Massachusetts Senators Elizabeth Warren and Ed Markey, along with Representatives Alexandria Ocasio-Cortez of New York and Andy Levin of Michigan, introduced the BUILD GREEN Infrastructure and Jobs Act, which would invest US$500 billion over 10 years on state, local, and tribal projects to modernize the country’s infrastructure and fund the transition to electric vehicles. Lawmakers have begun discussing an upcoming infrastructure bill with Biden, and according to Bloomberg, the progressive group hopes that measures in this bill can make it into the final package Biden will sign. https://bit.ly/3tROgBY
World’s largest coal miner Coal India bets on solar, eyes further mine closures.
Coal India Ltd, the world’s largest coal miner, could venture into solar wafer manufacturing and wants to “aggressively” participate in the country’s solar energy auctions, its chairman told Reuters on Tuesday. Pramod Agarwal said its joint venture with state-run NLC India Ltd plans to invest around 125 billion rupees ($1.73 billion) in solar power projects with a capacity of 3,000 megawatts, of which Coal India will invest some 60 billion rupees by March 2024. https://reut.rs/3vXhVf5
Sophic Capital Client Insights
AnalytixInsight’s (Sophic Client, ALY-TSXV): Millennials and Gen-Z demand corporate transparency and accountability.
They’re building wealth and will be investors for decades to come. Retail brokers can capture these young investors by incorporating ESG scores in their retail research. AnalytixInsight solutions now incorporate ESG scoring in their artificial intelligence/machine learning research offerings.
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