Hi! Bored of your normal morning pick-me-up? Starbucks stores in Italy are introducing the Oleato range this week, pouring a spoonful of olive oil into espressos, lattes and cold brews. Today we’re exploring:
The IPO class of 2020/21
For fast-growing startups, an IPO is often the ultimate goal, a milestone after which the company has “made it” — but how is the class of 2020/21 getting on?
Robinhood, Coinbase, Airbnb and many other high-profile companies were among those to go public in the last 3 years, cashing in on frothy markets. Since then, many have failed to live up to lofty expectations. Bumble, DoorDash and Robinhood shares have all shed at least two-thirds of their value. Coinbase, Rivian and Oatly have fared even worse, all falling at least 80%. That malaise has seen some companies decide that the spotlight of public markets isn’t worth it, with a number selling to private equity, including Weber Grills and McAfee.
Timing is everything
It’d be easy to look at the performance of these companies and conclude that the IPOs were failures — but, from the company’s perspective, it’s almost the exact opposite. Robinhood raised close to $2bn from new investors at its IPO, Bumble netted $2.2bn, oat milk maker Oatly got $1.4bn and Rivian raised a whopping $12bn. Investor sentiment has since turned, but at least each company built a war chest to weather the storm.
Companies that remained private missed out and startups that are burning cash now face the difficult decision of raising funds through a down-round or trying to go public in a market that has no appetite. Most notable is tech darling Stripe, which needs financial breathing room after cutting its workforce. The company is reportedly looking to raise at a $55-60bn valuation, a fraction of what many estimated they would have achieved had they gone public a year or two ago.
Meltdown
The latest data from the National Snow and Ice Data Center (NSIDC) reveals that the sea ice coverage around the Antarctic is smaller than ever, with just 1.79 million square kilometers recorded yesterday. That’s the lowest observed surface area since monitoring began via satellites in 1979, with further melting predicted by scientists in the coming weeks.
Deep into the Southern Hemisphere's summer, or melt season as the NSIDC refers to it, sea ice is always at its lowest, but this year's numbers have plunged to new depths.
1.79 million square km is still a lot of ice — it’s an area larger than Alaska, or 10x the size of Oklahoma — but it’s less than half of the coverage recorded on the same day 10 years ago. It’s even lower than 2022, the worst year for Antarctic sea ice on record, which saw sea ice coverage of 1.92 million square km at its lowest.
Warmed up
As we charted about last year, our oceans often take the brunt of warmer temperatures, absorbing more than 90% of global warming heat. Melting sea ice is a concern, not just because it disrupts habitats and important ocean currents, but because the bright sea ice usually reflects a lot of sunlight back into space. Less ice means less reflection and more absorption... which means less ice... and so a cycle of warming begins.
Top of the league
With the bidding war for soccer giants Manchester United heating up — bids are reportedly in the region of $6bn — and the MLS season kicking off on Saturday, we thought we’d explore the finances behind one of America’s fastest-growing sports.
Although some way off the largest European clubs, soccer in the US is big business, with last season’s champions Los Angeles FC becoming the first MLS franchise to hit a $1 billion valuation earlier this month, per Forbes.
Off-field finances
The MLS was founded 30 years ago as part of the 1994 US World Cup bid and has grown steadily ever since, building on the strong grassroots participation in the sport. Last year the MLS hit a record 10 million in annual attendance, helping the league to ink a lucrative $2.5 billion decade-long streaming deal with Apple.
Teams will be hoping that some of that fortune trickles down, as 18 of the 28 competing clubs in the 2022 season lost money, with New York City FC, Chicago Fire and Toronto FC among the clubs who lost $10m+.
Despite those losses, Forbes estimates that the average MLS club is now worth ~$580m, presumably because of the potential for growth over the coming decade. That valuation is up 85% from 2019 — and sides like Atlanta, and the other team in Los Angeles, LA Galaxy, are approaching the $1bn mark too.
• James Cameron’s Avatar: The Way of Water just grossed $2.243bn at the global box office, edging past his original water-based movie, Titanic.
• The Financial Times has done some important data analysis, finding out that there are 4 times more hedge funds than there are Taco Bells.
• Supermarkets putting high-valued items in locked cases may have stopped thieves but it's also stopped sales, with purchases down 15% to 25%.
• A UK pilot of 61 companies found that a 4-day workweek led to employees reporting they were happier and healthier.
• Turns out Yelp can tell us a lot about America, from where we work to our latest hobbies.
• Following our story above, now see where the MLS ranks on average attendance amongst other major North American sports leagues.
Off the charts: Which company, which operates on a slim margin most quarters, had a good holiday season but is cautiously softening its outlook for the year ahead? Answer below.
Answer here.
