Wall Street to Uber: “Whatevs.”
Uber (UBER) has a lot to celebrate. Over the past ten years, the company changed urban transportation as we know it, disrupted the taxi industry (and rightfully so), defied global regulators, and altered the nature of work. Last Friday, however, it got schooled.
Shares drop it like its hot
The ride-hailing behemoth’s first day of trading on the New York Stock Exchange began with a drop from its initial public offering price of $45. An exciting morning quickly shifted to anxiety as the numbers on the exchange floor began sinking below it’s $42 opening trading price. By the end of the day, Uber’s market capitalisation settled at $76.5 billion, but the stock tumble raised questions about investor appetite. Few companies of Uber’s stature have done so poorly as a public company on day 1. Well-known tech brands like Facebook (FB), Snap (SNAP), Alibaba (BABA), and competitors, Lyft (LYFT), all rose on their inaugural trading days.
Where there is hype, there is hope?
Uber still raised an impressive $8.1 billion from its IPO but the company and its bankers and pundits, in general, seem to have misjudged how much investors would embrace the stock. In 2018 Uber was pegged to be valued at $120 billion upon its IPO, which would have made it the most valuable American company ever to go public on the US share markets. And yet. Remember when Lyft enjoyed its first-day surge when it went public in March but quickly fell below its IPO price? Lyft shares are now down about 25% from their IPO price after the company reported losing more than $1 billion in the first three months of this year. Blame it on a volatile stock market, worsening trade tensions between the United States and China, or a lack of confidence in big businesses that don’t turn profits, but whichever way you cut it Uber’s IPO is a warning that investing in trendy tech firms might be risky business for the foreseeable future.
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Jeff Bezos, aka Rocket man
Last Thursday, Jeff Bezos unveiled his companyBlue Origin’s vision for space colonization as well as a moon lander capable of delivering 3.6 tons of cargo to our favourite rock in the sky. Amazon’s (AMZN) founder has an ambitious vision of the future: a trillion people in space colonies. This presents an opportunity for someone (here’s looking at you Jeff) to build the infrastructure for humans to survive - and thrive - in space.
Once in a Blue Moon
Bezos was clear that the space colonies would, in fact, be built by future generations, but he and his team would start building the infrastructure includingthe Blue Moon lunar lander– a sleek vehicle designed to deliver science payloads, moon rovers and even astronauts to the moon’s surface. The lunar lander will apparently be ready to fly by 2024, which also happens to be Trump and Pence’s goal date for sending astronauts back to the moon.The main criticisms of this endeavour are, of course, that space is a frivolous, ego-driven pursuit that diverts attention away from the pressing problems on our planet Earth. Bezos argued thatspace would be the future of humanitybecause we’re running out of energy. Yikes. Not into rationing, human? Get yourself to space then.
Big things start small
Bezos founded his rocket company in 2000, 2 years before Elon Musk launched SpaceX, but he’s been much quieter about it. For instance, whena Blue Origin rocket crashed during a test flight in 2011, Bezos took a week before he acknowledged it. It was only in 2016 that Bezos finally invited journalists to visitBlue Origin’s headquarters inthe State of Washington.
Blue Origin is still in the early stages, but also behind the accomplishments of Musk’s SpaceX. He’s dead keen to get it off the ground:Bezos said he’d sell $1 billion a year in Amazon stock to finance his space dreams. The first flights carrying people will happen later on this year. Sign us up, Earthling.
Whoa! Facebook faces more woes
Last week, Chris Hughes,Mark Zuckerberg’s former Harvard roommate, called for the government to break up the social media company he helped co-found. Hughes says he hasn’t worked at Facebook (FB) in a decade but still feels a sense of anger and responsibility.
Sass attack in the New York Times
So, how does Hughes lay out how to dismantle a company he calls a dangerous monopoly? Well, he doesn’t.The explosive article is based more on rhetoricthan actions, but it’s a nice gesture and not one we often see from tech entrepreneurs who profit from such companies. According to the Pew Research Center,close to 68 percent of US adults use Facebook. The service is particularly popular among women, urbanites, and college graduates. Facebook’s power does bring up a serious ethical problem: Zuckerberg’s tight grip on the board of directors, the company’s strategy, and actions. While Hughes doesn’t go there, there are calls forgreater checks on Zuckerberg, who controls the majority of voting shares as well as permanently splitting the roles of CEO and chairman.
When monopoly isn’t a game
You could be forgiven for thinking that Facebook is on a quest for domination and holds a monopoly over its users, especially after the acquisition of Instagram and WhatsApp.Breaking up, as you know, is hard to do, but sometimes it makes sense. They saypower corrupts; absolute power corrupts absolutely, and we’d like to think that isn’t the case here, but with an impressivelylong list of scandals, it’s getting kind of hard to fight in the Facebook corner. There are growing calls to take action against big tech who substitute the broader interests of humanity for their own. This latest call, from a former insider no less, will undoubtedly put pressure on lawmakers to seriously consider reining Zuck in.
Other interesting stuff
L.A. Drivers Strike Against Uber and Lyft
Jeff Bezos Has Plans to Extract the Moon’s Water
Elon Musk faces trial after calling British diver a paedophile
Uber's first investors open up about their wild ride
It’s time to break up Facebook