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Pre-IPO Stock Market Update - Mar 10, 2023 | TikTok, Mint Mobile/Ryan Reynolds, OpenAI, Two new unicorns, Pre-IPO stocks down for the week but beat S&P big
00:29 | White House is demanding ByteDance to divest Tiktok
- ByteDance current cap table; 60% global investors, 20% employees, 20% founders. The business is already majority owned by non-Chinese investors.
- The company shares do give ByteDance founders control over the business, perhaps that needs to change.
- ByteDance produced $61b in 2022 revenue. Tiktok was $10b in 2022. (...per my sources).
- ByteDance closed a $100m Series F at a $220b valuation in Mar 2023, a 22% increase from its last round in Dec 2020. ByteDance is the most valuable pre-IPO stock globally.
- If data security is the issue ... how does changing the cap table solve a data security issue?
- Oracle managing the app, reviewing code, and publishing to the app stores appears to be a much better data security solution, in my opinion.
- Early investors include Susquehanna Asia Investments, DST Ventures, Sequoia China. Other notable investors include General Atlantic, Softbank, NEA, KKR, Tiger Global, Carlyle, Coatue.
- The illogical divesture demand by the White House leads us to believe this whole thing is political farse … similar to how Chinese companies were to be delisted from US stock exchanges which ended up never happening.
02:54 | T-Mobile buys Ka’ena Corporation, a cell service provider, for $1.35b; 39% cash and 61% stock
- Ka’ena includes brands Mint Mobile and Ultra Mobile
- T-Mobile is acquiring the brands' sales, marketing, digital, and service operations
- T-Mobile will; use its supplier relationships and distribution scale to help the brands to grow and offer competitive pricing and greater device inventory to more U.S. consumers seeking value offerings and leverage Mint’s industry-leading digital D2C marketing expertise (aka Ryan Reynolds) as part of its broader portfolio to reach new customer segments and geographies
- Ryan Reynolds, the Canadian actor, owns a 25% stake in Mint Mobile; analysts estimate that Reynold’s acquired the shares at a $15m valuation, Reynold’s shares are estimated to be valued at $150m to $200m
04:31 | OpenAI, the AI company, releases GPT-4, a multimodal AI
- GPT-4 API pricing
...Prompt (questions that the user types in) = $0.03 per 1,000 “prompt” tokens (about 750 words)
...Completion (words that GPT-4 responds with) = $0.06 per 1,000 “completion” tokens (again, about 750 words)
...Tokens represent raw text; for example, the word “fantastic” would be split into the tokens “fan,” “tas” and “tic”
- Early adopters using GPT-4
...Stripe: GPT-4 to scan business websites and deliver a summary to customer support staff
...Duolingo: GPT-4 built into a new language learning subscription tier
...Morgan Stanley: GPT-4 powers a system that’ll retrieve info from company documents and serve it up to financial advisors
...Khan Academy: GPT-4 as an automated tutor
- OpenAI worked with Microsoft to develop a “supercomputer” from the ground up in the Azure cloud, which was used to train GPT-4
- OpenAI has a $29b valuation as of Jan 2023
06:25 | Large cap raises for the week
- Anthropic | $300m Series C, $4.4b valuation
- Scroll | $50m Series C, $1.8b valuation
- Character | $200m Seed, $1.0b valuation
- Humane | $100m Series C, $850m valuation
- Ring Therapeutics | $87m Series C, $602m valuation
07:24 | Pre-IPO stock performance for the week
- Pre-IPO stocks down 0.81% outperforming S&P by 3.6%
- YTD OpenSea and Kraken still lead the group up 36% and 21% respectfully, Chime is down YTD 31%, Airtable and Stripe are both down 21% YTD
- last week Chime was up 0.56% to lead, Epic Games was down 7.5% and Stripe was down 5.6%
AG Dillon & Co venture capital funds...
- AG Dillon SpaceX Pre-IPO Stock Fund = www.agdillon.com/spa
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