The stock market sucks.
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SPONSORED BY WANDER
In February, Wander raised a $20M Series A from some serious names like QED Ventures, Redpoint Ventures, Fifth Wall, Kevin Durant, among many others. Now, the company behind the network of beautiful, smart vacation homes is giving us all a unique investment opportunity.
Wander has launched the first ever vacation rental REIT for accredited investors. Through the REIT, you will own a portion of the beautiful equity in the properties while also receiving an 8% targeted annual dividend.
As KD would say, this sounds like a slam dunk. Make sure to check out this unique opportunity using the link below.
Overtime is one of the most underrated media companies in the game. The sports media company, whose main following is comprised of GenZers, has gained some serious social media clout through their coverage of up and coming high school athletes. I will personally never forget the wild Zion Williamson videos from his high school days a few years back.
The six year old company has over 50 digital shows and 65M followers across its 80 social media channels. Oh. And they have quite the valuation too.
In August, Overtime raised a $100M Series D @ a $600m valuation led by Liberty Media.
So why are we covering Overtime today?
This past week, Amazon announced an exclusive media rights deal with Overtime to stream 20 of the Overtime Elite (OTE) games. A big part of the reason for the Series D was to help Overtime launch OTE, a 3 team basketball league with some of the best high school basketball players in the country.
With Amazon now broadcasting 20 of their games (as well as creating an unscripted series following the teams next year), this represents another step towards beefing up Prime Video's sports rights.
I think this is a great deal for both Amazon & Overtime. Amazon gets to add Overtime to their rapidly growing list of sports rights like Thursday Night Football, WNBA, and rumored big push to the new NBA rights package too. Additionally, this will look to bring many GenZers to Prime Video on a regular basis.
From Overtime's perspective, not only are they making some $$$ from the deal, but also will get serious serious exposure to a platform that has significant scale. A great deal for both parties!
It is also interesting to note that Liberty Media, who led this last round, owns the publicly traded Atlanta Braves, F1, Live Nation, SiriusXM. John Malone’s once baby is the king of value creation, and I can almost guarantee you that Liberty will be a big part of Overtime’s strategic decisions as well as eventual exit plans.
2. Arc Technologies & 3.25%
Arc Technologies is a company that provides non-dilutive funding to B2B SaaS startups as well as FinTech resources to all startups. I had the privilege of catching up with them in the spring during my time writing Just Raised, and they are crushing it.
This past week, Arc announced a new offering that offers 3.25% yield on startup’s deposits. This offering, Arc Treasury, gives Arc the title of being the highest yielding digital bank that also offers same day liquidity.
3.25% is some serious yield and is drastically different than .2% interest in a classic bank.
Let’s say a seed stage startup raised $2M & has a burn rate of $30K a month. 3.25% yield would net you $65K annually, and could net you two extra months of burn/run rate. Powerful.
As an investor, there are two quick thoughts that come to mind. First, in companies that you have already invested in, I would check in and see where they have their cash parked. Two, during the DD process, a really interesting question to ask founders is where they have/will have their current cash sitting. This question can give you a lot of unique insight into the thinking of the founder.
3. Peloton = Extinguishing the Fire!
During Peloton’s earnings call, a fire alarm went off. Oh the irony.
Regarding the stock, Peloton dropped another few percent after some rough earnings and guidance:
- Revenue: $616.5M (actual) vs. $650M (expected)
- Earnings: ($1.20) (actual) vs. ($.64) (expected)
- Guidance: $700M-$725M (actual) vs. $874M (expected)
Even though Wall St. was very far off, the big miss makes a lot of sense. Very low consumer spending going into the holiday’s and many more bullets to bite from past managements approach to the business makes a big Q4 highly unlikely.
However, I do think the main story is the fact that the great Barry McCarthy, $PTON CEO, is looking more and more like he is going to be able to turn this ship around. Based on his tone on the earnings call and this quote below, it seems the failure of the company is no longer in question:
“Well, look our focus – our job one is to ensure the viability of the business, which a year ago was in doubt. And I believe that is no longer the case. “
Additional support that it looks like Peloton will live on came from CFO Liz Coddington who shared that they expect to be break even from a cash flow perspective in the second half of this year. Boom.
Liz also did apologize for the fire alarm going off.
4. Are Bridge Rounds Underrated?
AngelList Venture has a great blog that is a must read whenever published. A few days ago, Adam Ricks, Senior Data Analyst with AngelList Venture wrote a very interesting piece on bridge deals, and I will share a couple quick highlights.
In general, bridge rounds get a bad rap, but interestingly enough, bridge rounds with participation from top-tier VCs are actually the best performing rounds on AngelList with a TVPI (Total Value to Paid In capital) of 5.7x
Additionally, as you might expect, the earlier the stage, the more likely there is to be a bridge round. Specifically, here is the outlook of the distribution of bridge rounds by round:
- Seed - 30%
Series A - 25%
- Series B - 20%
- Series C - 15%
- Series D & Later - 10%
For the full blog with some interesting and nice graphs, check it out here.
Slow & Steady Wins the Race
Very similar to my introduction, almost no words are needed.
Note: The Crossover Portfolio is a mock portfolio of how I would be investing and not with real money. All trades are shared publicly @ The Crossover Twitter as they are recognized.
Paramount reported some earnings that the market did not like! The current gameplan is a full breakdown on Tuesday
- Sold our position in $TRMR and trimmed our positions in $ML & $SRAD. Simply put, want a little more cash and to be able to buy some $PARA & $FIGS dips
- $PENN reported solid earnings and will share more thoughts down the road
Note: The cost basis's are a little off. We will have it fixed for next time!
Here are some jobs that I’m curating in finance and tech. Use this link to submit a role to be featured if you’re looking to hire.
Risk Governance Manager @ Robinhood
Robinhood is looking for a new Risk Governance Manager with 6-8 years of experience. Bonus points if the person applying for this job has knowledge of brokerage, crypto, trading, and money services/payments.
Sr. Product Manager @ DriveWealth
Interesting opportunity for someone to help DriveWealth with their efforts for international expansion for their Europe and Asia Pacific business entities. If you know someone that would be interested, make sure to send this job their way.
Data Analyst @ SoLo Funds
SoLo Funds is an early startup and is looking to hire someone with expertise in Python and SQL to perform data analysis, data visualization, and database design. Great opputruntiy to join on early venture and help them grow.
"When your code works, but you have no idea how!" Lol.
- Check out this squad pic from the Workweek Halloween costume contest!
Incredible dunk by Jayson Tatum last night during Cavs vs. Celtics. Cavs still won though :)
- Josh Allen has a handshake with every Bills offensive player. What a legend.
- Stripe lays off 14% of their team
Thanks for the read! Let me know what you thought by replying back to this email.
Disclaimer: The Crossover is not a professional financial service. All materials released from The Crossover are for educational and entertainment purposes. The Crossover is not a replacement for a professional's opinion. Contributors to the Crossover might have positions in the equities in the The Crossover Portfolio or mentioned in the newsletter.
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