📱 How messaging apps plan to make $


March 17, 2021

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NBA superstar LeBron James has officially taken a stake in Fenway Sports Group, the $6B sports investment group that owns the Boston Red Sox. This is the biggest cross-sport deal since a certain SaaS business acquired a certain newsletter business.

The big idea
paper airplane

In 2021, messaging apps are looking to send a message about monetization

If money wasn’t a thing, messaging apps would be living the good life with billions of users and engagement to their hearts’ desires.

But money is a thing, and messaging apps have struggled to make it.

Without revenue streams to fund infrastructure during rapid growth, for example, one app — Telegram — has been issuing debt.

Now its bill is almost due…

… to the tune of ~$700m by the end of April.

The equipment and bandwidth that support Telegram’s 40%+ year-over-year user growth — currently at ~550m people — costs hundreds of millions annually, per CEO Pavel Durov.

Durov, who previously founded VK (Russia’s Facebook) has bankrolled Telegram for much of its history, but now says Telegram is building revenue-generating products.

Exactly what these features are remains to be seen

In a Telegram post, Durov outlined plans for non-targeted ads and premium features, though all current and private chat features will remain free on his platform.

In a messaging sphere where everyone is pretty much offering the same thing, companies are looking to get creative when it comes to keeping the lights on:

  • Line offers fun stickers that netted $638m between 2014 and 2019
  • Signal operates under a nonprofit foundation that relies on donations

That brings us to the unread message in the room: WhatsApp

Zuckerberg bought the platform — now used by 2B+ people and which at one point had a $1 annual subscription cost — for $19B in 2014.

WhatsApp is now testing monetization features like payments, in-app purchases, and a version for small businesses that counts 50m users.

The recent experiments show Zuck is more eager than ever to make back his 2014 purchase.

We can relate — we too would wish for a nice return on a $19B investment.

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Snippets
  • Google drops like it’s hot: The company announced a cut in Google Play store fees from 30% to 15% for companies’ first $1m in sales, meaning 99% of developers that sell through Play will see a 50% drop in fees.
  • The FTC dropped it like it’s hot: Newly leaked documents from the Federal Trade Commission (FTC) show that the agency anticipated a Google monopoly in the early 2010s… but refused to sue, per Politico.
  • Bird migrates across Europe: The superfun scooter micromobility company is investing $150m in Europe, with plans to launch fleets in 50+ cities and develop new recycling applications for vehicles.
  • Ford bets on Michigan: The auto company unveiled a $75m robotics and mobility research facility on the University of Michigan’s Ann Arbor campus that houses classrooms for students and workspaces for Ford engineers.
  • Facebook is looking to help writers monetize with a new platform for building websites and subscription newsletters, and will soon test the early product with a small group of independent creators.
  • Privacy Wars: Chinese companies like Tencent and ByteDance are testing a new workaround to Apple’s upcoming privacy features so they can still track iPhone users without needing permission.
  • Uber’s UK drivers… to get paid vacation and receive pensions following a Supreme Court ruling, per CNN.
  • Hip to be square: Website builder (and podcast ad favorite) raises $300m at a $10B valuation.
  • Stonks: Online broker eToro is eyeing a $10B+ SPAC deal to go public.
The Media Biz
Vice logo

Vice was once worth $5.7B. It’s about to get a huge valuation haircut.

Before The Hustle became your favorite source of irreverent news coverage, there was Vice.

Founded as a free magazine in Montreal in 1994, Vice was one of the most visible new media brands over the past decade — it peaked at a $5.7B valuation following a big investment round that included Disney.

Today, Vice could be worth 75% less

The Information reports that Vice is looking to go public via a merger with a SPAC company called 890 Fifth Avenue Partners. Negotiations value the company’s equity at $1.4B, after debts are paid.

Its revenue reached ~$600m in 2020, barely up from the prior year.

However, Vice’s CEO Nancy Dubuc has improved the business by cutting costs, with annual losses declining from $100m to $20m.

The source of Vice’s pain is its business model…

… which made a large bet on (low-margin) TV and news production.

Rich Antoniello — the CEO of Complex — thinks Vice should have put its eggs into ecommerce and culture… like Complex did (think Hot Ones, the popular web show of people eating hot wings while being interviewed).

Another noteworthy media brand is also going the SPAC route: BuzzFeed is eyeing a market cap of $1.7B… which is only slightly lower than its current valuation, per The Information.

Our $0.02: The companies should merge into ViceFeed and become a Bitcoin holding company.

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  • Their robotic surgical assistants use machine learning and advanced artificial intelligence to avoid soft tissue, making for less invasive surgeries
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Monogram expects its first revenue in 2021 with 2 active distributors and 8 patent applications currently awaiting approval.

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NFTs
NFTs

Historic $69m NFT buyer is building a virtual museum… kinda

Last Thursday, the artist Beeple sold the NFT artwork Everydays at auction for $69m — or ~42k ETH, to be exact.

Since then, everyone has asked: Who TF buys an NFT for $69m? A person with a pseudonym, of course — meet MetaKovan, a cryptocurrency investor and founder of Metapurse.

Who is MetaKovan?

Independent journalist Amy Castor connected MetaKovan with the serial crypto-prenuer Vignesh Sundaresan — a claim Sundaresan denies.

Sundaresan’s background:

  • Co-founded Bitaccess, putting 1k bitcoin ATMs in 15+ countries
  • Early investor in ETH, claims to have been “in the room” with the founder
  • Founded Coins-e, a now-defunct Ontario-based crypto exchange

Castor made the connection between MetaKovan and Sundaresan after listening to 2 audio recordings of each speaking. (We listened, it’s uncanny.)

MetaKovan’s plans for NFTs raise ’brows

Metapurse, the crypto investment firm financed by MetaKovan, is being “stewarded” by Twobadour (yes, another mysterious alias). It’s basically an NFT holding company on a mission to democratize access to NFTs.

Hold on, it gets crypto-ier.

In December, Metapurse purchased Beeple’s Everydays: The 2020 Collection for $2.2m. A few weeks later, they announced the release of a token dubbed B.20.

The tokens represent digital “keys” to Metapurse’s NFT portfolio and provide access to 3 virtual museums to view the NFTs. It’s like fungible-ing the non-fungible.

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TRENDS

One industry mushrooming to $86B…

A couple of months ago, our team came across an interesting stat:

The global fungi (mushroom) industry is forecast to double in the next five years to a staggering $86B.

This growth will be powered by:

  1. An increase in culinary demand, including utilization of mushrooms in new and interesting ways (coffee alternatives and alcohol-free spirits being two examples).
  2. Rising adoption by the pharmaceutical industry, especially as states (like Oregon) begin to legalize the regulated use of psilocybin ’shrooms as a treatment for anxiety, addiction, and depression.

Our team spent the week picking out the most interesting trends they were seeing around the mushroom market, and compiled them for you to pick through in a new Signals piece.

When you read through, you’ll learn:

  • How companies like Adidas and Lululemon are using mushroom-based textiles to develop the next generation of sustainable fashion
  • How the $117B agritourism industry is taking advantage of the new “Mushroom Hunting” craze
  • Opportunities within this growing market that you can get started on immediately
  • And much more.

If you’re not already a member of Trends, sign up today for a $1 trial to get access to the full report.

Access the Full Report →

Meme of the day
tweet

This is not medical advice (Source: Twitter / @TrungTPhan

Yesterday, we wrote about Stripe’s latest funding round: $600m raised at an absurd $95B valuation.

Here’s the sentiment of everyone that doesn’t work at Stripe:

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