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Stonks, Flying Burritos, and My Boss’s Boss – TechCrunch

Welcome back to The TechCrunch Exchange, a weekly newsletter on startups and markets. It’s largely based on the daily column that appears on Extra Crunch, but free and designed for your weekend read. Want it in your inbox every Saturday morning? Register here.

What a week. What month. Are you fine? It doesn’t matter if you are tired. We are all. That’s why we have weekends.

Let’s think about what happened this week: Individual traders outraged more professional investors by doing something hilarious, namely taking a trade that made sense – bet a physical retailer in atrophy was going to continue to becoming obsolete – and reversing it.

By going on GameStop for a long time, investors have reversed the script on smart money. Then it all cleared up, some stocks were blocked on trading services, Congress went mad, billionaires started presenting themselves on Twitter as if they were common man, some cryptos jumped, including Dogecoin of all things, and as we headed into the weekend, nothing was really resolved. It was strange.

Let’s talk about the lessons we’ve learned. First, don’t sell a stock so much that you risk having the trade exposed and reversed to your detriment. Second, the fintech startups that TechCrunch had covered for years were more fragile than expected, either due to back-up requirements or simple platform risk. And third, things can always become dumber.

Evidence of this latest lesson came during the week’s news cycle in which it became known that WeWork could be suing a public listing through a PSPC. So much for this more serious and normal year than 2020.

But let’s stop recapping and get into our main topic today, which is a discussion I had with the person I actually work for, Guru Gowrappan, the CEO of Verizon Media Group (VMG). For those who don’t know, Verizon owns VMG, which in turn owns TechCrunch. VMG is a collection of assets, ranging from Yahoo to media brands to technology products. It generates billions in annual revenue, which should help define how far above my seat – a great boom inside TechCrunch, but not the one that comes with org chart stature – Guru sits.

Very far.

But we’re following each other on Twitter and after Verizon announced its results this week, including some honestly pretty good numbers from VMG. I tweeted aboutI had about half an hour of Guru’s time. It meant I had my boss’s boss [etc] boss on the disk with zero agenda. How could I say no?

For context, VMG generated $ 2.3 billion in revenue in the fourth quarter, up 11% from the quarter last year. Verizon described it as “the first quarter of year-over-year growth since Yahoo! acquisition. “What drove the bottom line? According to Verizon’s earnings call,” strong advertising trends with demand-side platform revenues up 41% year-over-year “.

If you’re a Guru or, frankly, Yours truly, the growth was welcome after VMG’s revenue fell to $ 1.4 billion in Q2 2020, down 24.5% from its result of Last year.

I had a few questions: would the recent advertising momentum persist into 2021, which could impact a host of businesses far beyond the VMG organization; how important was Verizon that VMG managed to show year-over-year growth; how he intends to balance income from commerce and journalism; and what Guru thinks about new media products like the recent revival of newsletter technology, something Substack, Twitter and even Facebook are tinkering with.

Here is what I learned:

  • Regarding the good advertising performance in the last months of the year during COVID, Guru said that “the fundamentals [of] market dynamics have changed to be more permanent ”, adding that consumer behavior is now“ more digital, more online ”than before.
  • The CEO of VMG declined to share in detail expectations for the first quarter of 2021, but noted that VMG aims to “continue [its] momentum.”
  • Part of that momentum comes from subscription products, which Guru has called winners: “If you look at any of the trends that have happened due to COVID, consumers [are] switch to more reliable content and want to spend more time and money consuming subscription products […] TechCrunch / Extra Crunch grew almost 196% year over year. “
  • My reading of her response to where we are today is that it’s not a bad time to be in the online media game, which hasn’t been true in recent years, in looking around at the remains of the journalism industry.
  • Regarding VMG’s home inside Verizon – something I thought about after the Buzzfeed-HuffPost deal – I asked Guru if VMG’s recent financial performance made our business more attractive to Verizon. , what if we have proven the bet we were trying to make. This is the kind of question that is quite easy to write, but a little more difficult to ask when talking to someone who could terminate you at will. Anyway, Guru answered “completely” in response. The CEO of VMG summed up the CEO of Verizon by saying that the media industry is “essential” to Verizon and that our parent company “will continue to invest in the media industry while continuing to deliver on our promise.” Then sign up for Extra Crunch.
  • Guru said that VMG would not trade its income for credibility when it comes to promoting e-commerce on its platform: “At no time will we trade the dollar value of a transaction for trust; there’s no way. […] The editorial staff are keeping me honest, ”he said, adding that he stayed away from changes that could upset the journalistic balance. It was good to hear.
  • And finally, are there new media products that VMG may want to emulate or buy? Guru was generally optimistic about the customization, but declined to say that VMG was about to buy Substack or something like that.

Oh and I asked if VMG is going to sell, or otherwise divest, other media properties as a result of the HuffPost-BuzzFeed decision. Guru said the CEO of Verizon has said the company as a whole is “fully engaged” in the media business and that it will not be “built on divestment.” Instead, he said, it will be built “on investment and growth”, adding that there are “no plans to sell additional properties”. As I love my health insurance, it was nice to hear.

I understand the above is not some sort of standard exchange entry, but one thing I will always try to do is take the conversations that come to me through my work and bring them to you.

Now back to venture capital.

Market Notes

GameStop was your entire Twitter feed this week, but there are other things you need to know. Alfred, a US-based fintech, raised $ 100 million on Tuesday, to take an example. The company merges digital intelligence and humans to help users manage their financial lives. Cared for.

And adding to our recent data-driven coverage of 2020 business data – including a dive into the African venture capital market – investment group Work-Bench took a look at the performance of New York’s corporate tech scene in the second half of last year. This is the exact type of data I would analyze for you over a more regular week. But since we had this week you have to do it yourself.

Sticking to data, Hallo, a start-up that helps companies recruit more diverse candidates, published a wad of data in its “Black Founder Funding Q4 2020” report. Read it. If you don’t have time I’ll give you the statistic that both caught my attention and put my heart down: “The Hallo study revealed that of the 1,537 companies analyzed [in Q4 2020], 40 were led by black founders.

And this week I got to jam with Microsoft after reporting income. Saving most of that for a later date, two things were clear: The cloud world still has a lot of growth ahead of it, which is good news for much of the startup software market. And if you want more data on Teams growth to better understand why Salesforce bought Slack, wait another quarter.

Miscellaneous and Miscellaneous

In conclusion, in August 2014, I came up with the idea of ​​a burrito cannon food delivery service. You would press a button in an app and it would deliver a burrito to your desktop without you having to make any choices. Then Postmates actually built a burrito cannon into their app, which was both hilarious and fun.

Fast forward to 2021, and Postmates is now part of Uber. And it’s back with the return of the burrito cannon:

I didn’t think my lazy, silly idea would help an NFL star, over half a decade later, sprint through a field as an industrial-scale potato cannon fired a Mexican delight in its direction. But it’s 2021 and that’s where we are.

Proof, I think, that all my startup ideas are great,

Alex




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