Enough about Netflix, what about Roku?

Today, experts express concern over “accelerated pay” and, last Friday, Stripe’s funding round had a lot to say, but first…

As the content wars heat up, Roku’s stock price is a roller coaster of stre-motions

On Friday, Netflix stock tumbled 7% after CEO Reed Hastings acknowledged the onslaught of incoming streaming competition from companies such as Disney and Apple.

But World-War-Stream is also carpet-bombing hardware providers like Roku, a market leader that provides consumers the privilege to Netflix-and-chill. Roku saw its stock price tumble 25.9% last week, prompting some analysts to pull the “overvalued” card.

But, as Roku continues to experience success with global expansion, some traders aren’t so sure — and it’s creating one of the most volatile stocks in tech.

Da bulls…

At the start of Q1, Roku said it planned to bring in $1B in revenue for 2019 despite the increase in streaming competition. Its plan: Focus on global expansion of its streaming device, and its Roku-branded smart TV (half of Roku customers still watch traditional television).

And it’s working: Roku’s shares have tripled since then — giving the company a market value of around $13B — and it recently inked a deal with Chinese electronics manufacturer Hisense to sell Roku-powered TVs in the UK. 

According to MarketWatch, Oppenheimer remains “upbeat” on Roku’s global expansion plans and believes the company has a head start on its competition.

Da bears…

As of last Friday, Roku’s stock had dropped more than 10% on 3 different occasions in the past 9 trading days from new competition.

This includes a 14% dip after Comcast offered up a free Xfinity Flex streaming box to internet-only subscribers, and a 10.5% tumble when Apple announced a free year of its new subscription channel Apple TV+ for Apple-heads looking to upgrade their Mac, iPhone, or Apple TV device.

On Friday, Pivotal Research sent a note to clients titled, “Is Roku Broku?” — giving a sell rating and stock price target 45% below its current value.

So is Roku actually ‘Broku’?

Not if you count the better part of 2019. It’s worth noting that Roku’s stock is still up over 250% this year, leaving Chipotle (the boss performer of the S&P 500) in the dust by nearly 160 percentage points.

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Stripe earns its… erm… big payday 

Stripe, an online payment processing company, is raising $250m in new funding — bringing its valuation to $35B and making it the 3rd highest-valued US startup.

Are payment processors the new internet royalty?

Apparently so. As commerce has moved away from physical storefronts to digital spaces like in-app purchasing, payment processors are increasingly important — and Stripe has been a big player in making it happen. 

Although consumers don’t see Stripe’s branding when they look at their shopping carts, more than 80% of American online shoppers have made a Stripe-powered transaction in the past year.

The transaction titans are major moneymakers. Overhead is low, and because they charge 2% to 3% on each purchase, they bring in steady revenue. 

Naturally, investors want in

In 2018, more than $22B in VC went toward payment startups globally — more than 4x more than in the previous year. Stripe’s co-founders have been committed to staying private. But increasing competition might change their minds.

Though Stripe surpassed its biggest rival, Square — valued at about $25B — there’s more competition outside the ropes. Checkout, a London-based payments processor, sold a $230m stake earlier this year, bringing its valuation up to $2B. It’s ready to bring its game to the US.

The perk of werk: Companies are using ‘accelerated pay’ to entice new employees

As US wages continue to stagnate and unemployment remains low, about 12% of companies — including Walmart and McDonald’s — are offering a controversial new perk to attract workers: on-demand access to earned wages.

That’s right, no more biweekly pay prison, babayyy! But, while this practice may seem like a benefit, some experts worry it will be overused.

Financial freedom-fighter? Or gussied-up payday loan?

Accelerated pay companies say they’re not providing payday loans, which charge rates of up to 400% — but, rather, allowing users to access their money as they earn it. 

However, there’s one sliiight red flag: In order to instantly tap into wages, users must pay a transaction fee (ding, ding, ding).

DailyPay, the leading accelerated pay provider, boasts the lowest transaction fees in the industry at $2.99 per wage pull and says its service helps to reduce turnover, aid in recruitment, and promote financial wellness for employees. 

Even, another provider, charges a flat monthly fee of $6-$8 and users pull an average of $150 each month — equating to about a 5% fee for taking out money early. This isn’t your crazy high interest payday loan, but it’s not nothing.

A peril dressed in perk’s clothing?

A 2017 study found that 78% of American workers live paycheck to paycheck. Experts predict accelerated pay programs could further constrain workers’ finances rather than provide financial freedom.

DailyPay reports that companies employing hourly laborers are drawn to their service and that users on average take out $66 once a week.

Douglas Boneparth, a certified financial planner and president of Bone Fide Wealth, said that the option to receive pay in real time “tends to… make bad discipline worse.” Allowing lower-income workers access to wages ahead of actual paychecks may lock people into a pattern of subsisting day by day.

The myth of the millennial founder: Next-gen entrepreneurs are increasingly seniors

In 2007, Mark Zuckerberg famously said, “Young people are just smarter.” 

Now, seniors and middle-aged Americans are getting revenge. A recent Gallup poll estimated that people over 50 become entrepreneurs at twice the rate of millennials. 

Nowhere is the elder entrepreneurship boom more apparent than at Senior Planet, where older people are learning how to excel in a world where, founder Tom Kamber says, “technology has run them over.” 

‘Critical and urgent’ dreams

Senior Planet, which MIT Technology Review calls the “tech-savviest retirement community on earth,” is a post-60 co-working space and instruction center in New York. Some clients learn how to build online businesses and pitch potential investors, while others just figure out Facebook and Google Hangouts.

Becoming an entrepreneur is often a need because many people share Zuckerberg’s view: Studies have shown employers are far less likely to call back older clients, especially women. 

And Kamber says that when you’re older, “Your horizon is shorter — your dreams become more critical and urgent.” 

From analog skills to Facebook fame 

Success stories at Senior Planet involve everything from fabric to food businesses to artists. In his 50s, Calvin Ramsey ended his insurance career to chase a screenwriting dream. After managing to get a book and play published despite being unable to use email, he went to Senior Planet to learn computer skills. 

Ramsey is now a well-known writer with 37k Facebook fans. One reason for his rapid success? He can finally email scripts.

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