Wealt Roundup #52

Good morning ??

Welcome to the new edition of Wealt Weekly Roundup.

This week's highlights include SpaceX criticising the FAA, Google overturning a $1.7B EU fine, TikTok challenging U.S. divestiture law, Amazon mandating office returns, OpenAI making safety updates, FED’s rate cut, and the featured blog exploring the F.I.R.E. movement for financial independence.

Stay informed with Roundup – your guide to finance and tech trends!

Highlights from Wealt

Live deal: Canva ????

Founded in 2013, Canva has grown into a leading online design platform with over 170 million Monthly Active Users (MAUs), including more than 18 million paid subscribers. It democratizes design by offering various tools and templates for individuals and businesses. Canva's user base spans educational institutions, individual creators, and large organizations, including 94% of the Fortune 500 companies.

Growth Drivers

• Goal: Reach 1 billion MAUs within the next decade, focusing on educational institutions and large organizations.
• Freemium Strategy: Drives organic growth through an accessible entry point while optimizing pricing by transitioning from free to paid tiers.
• AI-Powered Tools: Leveraging OpenAI's ChatGPT and DALL-E, Canva’s Magic Studio enables users to create AI-driven visuals. Over 55 million users have already been onboarded.

Enterprise & Financials

Canva has expanded its enterprise offerings, with 8 million Team subscribers and a strong presence in over 340,000 organizations. Revenue has grown substantially and is projected to increase from $287 million in 2020 to over $2 billion by 2024, with significant ARPU and annual recurring revenue gains. Its cost structure is optimized for scalability, improving gross margins and free cash flow.

Valuation

Revenue multiples for SaaS companies surged during the 2020-2021 period but have since normalized. Canva is expected to maintain a competitive position in the market as valuations stabilize.

Check out the Wealt app or web form to register your interest!

Portfolio news

SpaceX criticized the FAA's slow regulatory process in a letter to Congress, arguing that delays in license approvals led to proposed civil fines for minor violations during past launches.

Read more.

SpaceX launched 20 Starlink satellites from Vandenberg Space Force Base on September 20, 2024, successfully landing the Falcon 9 rocket's first stage on a drone ship in the Pacific Ocean.

Read more.

SpaceX is challenging a $633K FAA fine for alleged launch license violations in 2023, arguing that the issues stem from the FAA's inability to keep pace with the fast-growing space industry. The FAA claims SpaceX launched without required approvals, while SpaceX asserts the changes were minor or already approved by other authorities.

Read more.

Anthropic introduced "Contextual Retrieval," a new method to improve how AI models find and use information. By adding specific context to data chunks, this approach reduces retrieval failures by up to 49%. When combined with reranking, the improvement can reach 67%. This innovation emphasizes the importance of effective data handling and context for enhancing AI performance in specialized applications like customer support and legal analysis.

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8090 introduced xRx, an open-source framework developed in collaboration with Groq, designed to enhance multimodal conversational AI by allowing real-time integration of voice, text, and images while prioritizing low latency and user experience for developers.

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Market updates

• ?? Apple released iOS 18 on 16th September with Apple Intelligence and many other features.
• ?? TikTok is challenging a U.S. law requiring its divestiture from ByteDance or a potential nationwide ban, arguing it would harm free speech and U.S. creators. The government defends the law as necessary for national security, focusing on data privacy concerns related to TikTok's Chinese ownership.
• ?? A new bill introduced in Parliament will legally recognize digital assets such as Bitcoin, NFTs, and carbon credits as personal property for the first time in British law. This will offer increased protection against fraud and disputes while keeping the UK at the forefront of the global crypto industry.
• ?? Microsoft has signed a 20-year deal to exclusively access 835 megawatts of energy from the revived Three Mile Island nuclear plant to power its AI data centres. This agreement aligns with Microsoft's goal to use clean energy and decarbonize its operations by 2025.
• ?? Cisco's second round of layoffs in 2024 affected around 5,600 employees, including those in its Talos Security unit. This was despite the company reporting one of its strongest financial years, with nearly $54 billion in revenue.
• ???? Amazon CEO Andy Jassy announced that starting in 2025, employees will be required to return to the office full-time, shifting from the current three-day hybrid model, despite resistance from some workers.
• ?? OpenAI has enhanced its safety and security practices by establishing independent oversight, improving cybersecurity, increasing transparency, collaborating with external organizations, and creating a unified safety framework for model development.
• ?? LinkedIn used user data to train AI models without initially updating its terms of service, providing a delayed opt-out option for U.S. users. The company faces criticism for not obtaining explicit consent, mainly as platforms increasingly monetize user-generated content for AI training.
• ???? Google overturned a $1.7 billion antitrust fine from the EU regarding its AdSense business. The EU's General Court annulled the decision due to an incomplete assessment of contract durations, while most findings were upheld. The EU may appeal, and Google expressed satisfaction with the ruling, noting changes it made in 2016 before the original decision. In this trial, YouTube CEO Neal Mohan testified that Google faced significant competition in ad tech and acted in the best interest of consumers and the industry, refuting the Justice Department's accusations of monopolistic behaviour.
• ?? Microsoft and BlackRock are launching a $30 billion fund with the potential to mobilize $100 billion to invest in AI infrastructure projects, including data centres and energy initiatives, alongside partners like Abu Dhabi’s MGX and Nvidia.
• ?? The Federal Reserve cut interest rates by 0.5%, marking its first rate reduction since the early Covid pandemic, in response to moderating inflation and a weakening labour market.
• ?? UK wealth manager Quilter has acquired digital investment platform NuWealth to enhance support for first-time investors. The company aims to integrate the platform with financial advisers and expand its digital capabilities for novice investors.

Wealt blog spotlight

This week’s selected blog is The FIRE Path to Retirement Freedom.

F.I.R.E. (Financial Independence, Retire Early) movement aims to empower individuals, particularly millennials and Gen Xers, to achieve financial independence through rigorous saving and strategic investing. It emphasizes the importance of high savings rates (50-70%) and presents various approaches to F.I.R.E., such as LeanFIRE and FatFIRE, catering to different lifestyle preferences and financial goals. While the movement offers the promise of early retirement and financial freedom, it also requires strict discipline and poses risks, including market volatility and healthcare costs.

Read more.

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With warm regards and enthusiastic spirits,

Wealt Team ???