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TechCrunch is not a publication aimed at the public market. We take care of start-up companies. But sometimes public technology companies can provide interesting information on how the wider technology market is performing. So we are paying what we might call minimal viable attention to former start-ups that have even reached IPOs.
Then there are the Big Tech companies. In the US, the list is well known: Facebook, Alphabet, Microsoft, Apple and Amazon. And in a series of results that could show a hot market for startup growth, they had an astonishingly good first quarter of 2021
Yes, Big Tech’s financial results have been good – as they have been for some time, but lost among the usual streams of profits is how shocking the recent credentials of Big Tech have come to be for their valuations.
Microsoft fell to $ 135 a share last March. Today it costs $ 252 and is changing. Alphabet was trading at about $ 1,070 a share. Today, the search giant costs $ 2410 per share.
The result of the huge rise in shares is that Apple now costs $ 2.21 trillion, Microsoft $ 1.88 trillion, Amazon $ 1.76 trillion, Alphabet $ 1.60 trillion and Facebook $ 0.93 trillion. That’s about $ 8.4 trillion for the five companies.
Back in July 2017, I wrote an article in which I note that their total value has reached the limit of 3 trillion dollars. That became $ 4 trillion in mid-2018, and then over the next three years or more, more than twice again.
Miles Woodland, a reporter for our sister publication Yahoo Finance, has at least part of the puzzle in a piece he wrote this week. Here is Udland:
And while almost every revenue history seems to have followed this same arc, the data also confirms that it’s not just our imagination: corporate profits have never been so far behind expectations.
Data from the Refinitiv team, published on Thursday, show the speed with which companies beat forecasts and the degree to which they exceed expectations on Thursday morning results are the best in history.
So income beats street assumptions more often and by a higher margin than ever? This makes the recent rise in the stock market less worrying, I guess. And it helps explain why startups have been able to raise as much capital in the United States as in Europe lately, and why private market investors are pouring so much capital into fintech startups. And that’s probably why Zomato became public and why we’re still waiting for Robinhood’s debut.
This seems to be the market where the core business shoots at all cylinders. Just remember that no business cycle is endless and no boom is forever.
Interaction between insurtech
Expanding the latest stock market reports on fintech financing and our last week’s review of insurtech startups, a few more notes on the latest start-up niche that can be seen as part of the larger world of financial technology.
This time we will hear from John Locke of Accel about his investment in The Zebra – which recently raised even more capital – and the space of insurtech more widely.
Asked why insurtech markets like The Zebra have managed to raise so much money in the last year, Locke said it’s a combination of “insurance carriers”. […] finally to cover the markets and to want to design an integrated consumer experience with the markets, together with more “shopping comparisons” and finally, revenue growth and quality.
Zebra, Locke said, “is still growing north of 100% at ~ $ 120 million + revenue rate.” This means that it can be made public whenever it wants.
But there is some weakness in the stock market for some public insurance companies on this issue. Is Locke worried about this? He is neutral to the positive, saying that his company “does not think that all companies in the market will work, but nevertheless believes that” insurtechs “will take market share from those operating in the next decade.” Fair enough.
And Accel is still considering more space deals as well. Locke said the risky market for investment projects was “definitely more aggressive” this year than last.
Different and different
We end today with a few notes on things we haven’t come to on this issue:
- The productboard closed $ 72 million in the C-Series. First, it’s a huge round. Second, yes, Tiger did lead the deal. Third, today the product management software company has about 4,000 customers. That is a lot. Add this company to your IPO list for two years.
- The Chinese launch of Hello bicycle sharing is becoming public in the United States. We’ll get back to that on Monday, but the F-1 submission is here. The company turned 2020 revenue of $ 926.3 million into $ 109.6 million gross profit and a net loss of $ 173.7 million net loss. Yowza.
- Darktrace went public this week. I know about him because he sponsors an F1 team that I adore, but today he is entering our world as a recent company registered in the United Kingdom. And with Deliveroo coming out, the stunning success of the Darktrace list could make the UK a more attractive place to list than a week ago.
- Finally, the drone delivery, perhaps, is finally coming? The UK-listed venture capital group Draper Esprit has raised $ 25 million in Manna, which wants to use drones in Ireland to deliver. “Mana sees a huge appetite for a greener, quieter, safer and faster delivery service,” UKTN reported.
A long, strange week. Don’t forget to follow the second Denis from The Exchange’s writing team: Anna Heim. Good! Chat next week!