💰 Coinbase drops big numbers

Thursday, April 8, 2021 by Robinhood Snacks | Disclosures

The Creator Economy intensifies

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Hey Snackers,

Ikea is being accused of running “a system of espionage” in France. We're waiting for the next hit spy novel: The Couch That Came in From the Cold.

The S&P 500 hit a record high yesterday. Investors were happy with notes from the Fed’s last policy meeting. TLDR: the central bank is still committed to supporting the economy.

SZN
1. Coinbase is going public next week – and it just dropped some major numbers

Coin, based... The largest crypto exchange in America is scheduled to go public next Wednesday via direct listing (sorry, IPO). Coinbase will list its shares (directly) on the Nasdaq, becoming the first publicly-traded crypto exchange in the US. Coinbase thrived last year as investors poured into bitcoin. In 2020: it made $1.2B in revenue, and its first-ever annual profit of $322M. But it just shared some quarterly estimates that make those numbers look like BTC circa 2018:

  • $1.8B: Coinbase's estimated revenue for the first three months of 2021 — aka: more than all of 2020, and 9X more than the year-ago quarter.
  • $730M-$800M: Its estimated profit for the first quarter — aka: more than double last year's earnings.

Satoshi would be proud... whoever he/she/they are. 12 years have passed since the mysterious Satoshi Nakamoto mined the first block of the bitcoin chain — and crypto is more relevant now than ever. Coinbase expects that it has a whopping 56M verified users (6.1M of which are trading monthly).

  • ~$2T: The total value of the crypto market has already doubled since January, when it first topped $1T.
  • $223B: The estimated value of crypto assets that Coinbase has — or around 11% of the whole crypto market.
THE TAKEAWAY

Coinbase's numbers highlight a "seasonal" effect... Coinbase's seasonal biz has nothing to do with ski lifts or white-sand beaches. A ski resort thrives in winter — Coinbase thrives on crypto buzz times. As bitcoin plunged in 2018, Coinbase lost 70% of its monthly transacting users. Before 2020, it had never seen a profit. As crypto dominated the conversation this year, Coinbase estimates it made more in three months than in all of 2020. Unprecedented crypto season = unprecedented earnings. Because of its reliance on fees from user trades, its fortunes can rise and fall with the crypto weather.

Create

Influencer. Artist. Force of Nature... The Creator Economy's Insta bio (don't forget the sponsor link). Like the rest of us, celebs/influencers/creators stayed home in 2020. Concert venues, comedy clubs, and film studios were closed. To cash in on their talents, creators went full DTA — Direct-to-Audience. Now, companies that help content creators directly monetize their work are thriving. And the venture capital cash is following:

  • Patreon, the subscription site that lets you pay your favorite YouTuber, just raised $155M at a $4B valuation — up more than 3X from September 2020.
  • Cameo is the startup that lets you request personalized vids from celebs (like Kevin from The Office). It hit a $1B valuation last week after a $100M fundraise, joining Club Unicorn.
  • Substack, a platform for writers to publish paid email newsletters, is reportedly raising $65M in fresh funding at a $650M valuation.
  • Clubhouse, the audio social network that loves tech chat rooms, reportedly might raise money at a $4B valuation (4X its January value).

Shoutouts mid-live stream... Fans love feeling connected to their favorite creators, and want to support them. That's great for Creator Economy startups. Not-so-great: where fans connect doesn't matter as much. Really not-so-great: Big Tech is copying Creator Economy features.

THE TAKEAWAY

Creator Economy startups should consider merging... because Big Tech is onto the trend. Just a few examples: Spotify, Facebook, LinkedIn, and Twitter are all working on Clubhouse rivals. Twitter acquired a Substack-like paid newsletter company — and plans to integrate it into Twitter. If Creator Economy startups merged to offer an all-inclusive platform for interacting with creators, they might stand a better chance against Big Tech. We call it... “Creators Inc.”

What else we’re Snackin’
  • Snop: Snap is reportedly planning to launch personalized in-app shopping, and bought an app called Screenshop (not screenshot).
  • Buffet: Carnival says it has seen a record level of future cruise bookings during the first quarter — but it's still not allowed to cruise.
  • Vax: The UK is limiting AstraZeneca's vaccine to people over 30, following concerns over rare blood clots.
  • Paid: Plaid, the company that (invisibly) connects your bank account to apps like Venmo, hit a $13.4B valuation after its canceled $5B Visa acquisition.
  • Taxing: Treasury Secretary Yellen says the Biden admin's proposed corporate tax increases would bring home ~$2T in overseas profits.
Snacks Daily Podcast

Slap this on the LinkedIn profile: “A world leader in specialty coatings and sealants."

RPM International makes floor polish, but it has an even more résumé-worthy accomplishment: increasing dividend payments to shareholders for 47 years straight.

We're talking "Club Dividend" on our 15-minute pod.

Thursday

Authors of this Snacks own: Bitcoin and shares of Snap

ID: 1595122