(#21) From FAANG to MAAMAA; Zoom's wrong strategy and Carl Icahn might run a ponzi scheme
The "year of efficiency" continues not only at META, but also at companies ranging from AT&T to Ford.
From FAANG to MAAMAA
These are the companies that will dominate the AI cycle. Nvidia may have a chance today, but not in 5 years.
META’s inability to close Reality Labs
My TGV theory says that large companies can’t innovate anymore and go just like a train from A to B, never to C.
So, instead of spending +30bn USD in the metaverse, that money could have reached the same goal much cheaper and, maybe, successfully - coming from a start-up.
Zoom B2C’s wrong strategy
It is crazy even to think that at some point in time, Zoom had a higher market capitalization than Exxon.
The only positive thing about this product is that it is extremely easy to use.
Otherwise, from the strategy point of view will remain a niche product at best:
1/ Free products, or products for which you are already paying, will keep squeezing them: e.g., consumer products (META, Google) and business (Teams)
2/ Zoom’s engineering team is located in China and has many security implications (i.e. for sure, they are watching what is happening now with the TikTok ban)
3/ Is not part of a bundle product, like Teams; maybe here is an incentive for Salesforce to buy it
4/ Lastly, I think their greatest mistake was trying to spend so much time on the consumer market instead of focusing on solid and constant enterprise revenue. (ie. Zero network effects)
At the end of the day, people use Zoom for video conferencing and do not take it as it is promoted: “a unified communication and collaboration platform.”
LMHH knows how to sell luxury
Last week the world’s richest man, Bernard Arnault, reopened their Tiffany’s store on Fifth Avenue and 57th Street.
1/ Before closure, the store brought close to 10% of the global sales (!). Spending half a billion dollars for renovation will be recovered in less than one year
2/ New York is New York, no matter how much money you make in China
3/ This hefty investment and LMHM’s strategy is better summarized by the owner: “You cannot dream when you talk numbers”. LINK
The Year of Efficiency
1/ A&T realized it cost the company 28k hours to throw a retiring party. Analyzing similar events, they saved up to 3 million working hours
2/ AT&T also has a new initiative called “Project Raindrops.” They are assessing how they are working to save money and time by simplifying and eliminating business processes.
3/ Waste Management Inc. has optimized the truckers’ routes to save money (and time). LINK
Deloitte and PwC sau pandemic-era graduates struggle with teamwork. Solution: coaching and training (to close the knowledge gap). Working daily with students I can tell that the pandemic affected negatively the students more. LINK
Ponzi schemes always end badly.
Another great read from Hindenburg Research, a company specializing in forensic financial research. LINK
Tesla’s strategy to cut prices
Well, their famous (30%) margin is gone. Now, I think Elon tries to do the following:
1/ Utilize to the maximum extent possible the gigafactories (in the end, he also has some commitments to numbers: is. cars sold)
2/Differences will always be made on software, and he thinks Tesla is in a much better position than any other company (including Chinese companies like BYD)
3/ Most of the cool stuff will cost extra, and we’ll create to Tesla a significant revenue stream
4/ Of course, the current cuts are also to be under the threshold of receiving the governmental subsidies (around 7,500 USD), which from the price point of view is a very competitive product
5/ In a price war, all companies suffer; except the consumer. LINK
Knowledge Partner: EY Romania
2022 was a historic year for the global economy driven by geopolitical and economic uncertainty. While the Global M&A market experienced a 36% decrease, the Romanian one recorded a 10% increase. Read the full report now.
“In fact, the business plans of the next 10,000 startups are easy to forecast: Take X and add AI. Find something that can be made better by adding online smartness to it.” - Kevin Kelly
Roblox is adding generative AI so you can generate new materials and structures. LINK
Runway released Gen-2 of its text-to-video tech. It’s a huge improvement. Soon, we’ll be able to create video content with words, and META is the first to do exactly that:
“It's like filming something new, without filming anything at all.” LINK
Scientists used a ChatGPT-like model to decode human thoughts. The results? Human thoughts were predicted with 82% accuracy using MRI recordings. LINK
Microsoft mentioned artificial intelligence (AI) 50 times on its earnings call. AI is no the new Digital transformation LINK
Generative AI market size
According to Precedence Research, the global generative AI market size was estimated at USD 10.79 billion in 2022 and is projected to reach around USD 118.06 billion by 2032.
Growth will come from Eastern and Central Europe. This area will see a boom with businesses relocating from China and Russia (partially Ukraine).
Uber’s plan to profitability
Looking forward to seeing Uber delivering results. Maybe next year, maybe never.
1/ We don’t know how much money Uber makes from advertising. This can turn on the real profit generator
2/ Sales & Marketing - $1.3 bn — too much even by Uber standards and in the context of high capital costs
3/ Network effects are still working for Uber users and drivers. LINK
Germany has the most billionaires among the world’s 500 biggest fortunes.
India has quintupled the percent of its GDP it spends on infrastructure in the last decade.
Demographics is destiny 🐣🐣
In 2021, the highest fertility rates in the EU in:
🇫🇷 France (1.84 live births per woman)
🇨🇿 Czechia (1.83)
🇷🇴 Romania (1.81)
🇲🇹 Malta (1.13 births per woman)
🇪🇸 Spain (1.19)
🇮🇹 Italy (1.25)
Amazon, Google, and Microsoft now have 65% of the cloud market share. LINK
Romania will have by the end of the decade 600,000 foreigners in Romania. The industries needing them will increase from food delivery to construction and HORECA. LINK
How clothes were washed in northern Scandinavia. LINK
Chernozem (Black soil) — the most fertile soil on earth
Some of the most beautiful and famous mathematical theorems are explained to Midjourney. LINK
Why Steinway Grand pianos are so expensive? LINK
Salt Bae's former employees complain about tip theft, discrimination, and polyester uniforms. LINK
Vikings in Greenland Imported Wood From Europe – and Canada. LINK
Commuting in Japan (1963)
Como Lake is becoming a magnet for mass tourism. The locals are not happy. LINK
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