Welcome back to The TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s broadly based on the daily column that appears on Extra Crunch, but free, and made for your weekend reading. If you want it in your inbox every Saturday morning, sign up here. Ready? Let’s talk money, startups and spicy IPO rumors.
TechCrunch isn’t a public-market-focused publication. We care about startups. But public tech companies can, at times, provide interesting insights into how the broader technology market is performing. So we pay what we might call minimum-viable attention to former startups that made it all the way to an IPO.
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https://emiratehub.ae/thread-321.html
https://forum.quizph.com/thread-19536.html
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http://undergroundradio.eu/showthread.php?tid=22022
https://www.mac-it.ch/forum/showthread.php?tid=500278
https://moroccansoverseas.com/forum/showthread.php?tid=331296
Then there are the Big Tech companies. In the United States the list is well-known: Facebook, Alphabet, Microsoft, Apple and Amazon. And, in a series of results that could indicate a hot market for startup growth, they had a smashingly good first quarter of 2021. You can read our notes on their results here and here, but that’s just part of the story.
Yes, the Big Tech financial results were good — as they have been for some time — but lost amid the usual earnings deluge of numbers is how shockingly accretive Big Tech’s recent performances have proven for their valuations.
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Microsoft fell as low as the $135 per-share range last March. Today it’s worth $252 and change. Alphabet traded down to around $1,070 per share. Today the search giant is worth $2,410 per share.
The result of the huge share-price appreciation is that Apple is now worth $2.21 trillion, Microsoft $1.88 trillion, Amazon $1.76 trillion, Alphabet $1.60 trillion and Facebook $0.93 trillion. That’s around $8.4 trillion for the five companies.
Back in July of 2017, I wrote a piece noting that their aggregate value had reached the $3 trillion mark. That became $4 trillion in mid-2018. And then in the next three years or so it more than doubled again.
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https://therockandduckshow.net/showthread.php?tid=2050
https://www.jasausaha.net/thread-233.html
Why?
Myles Udland, a reporter at our sister publication Yahoo Finance, has at least part of the puzzle in a piece he wrote this week. Here’s Udland:
And while it seems that almost every earnings story has sort of followed this same arc, data also confirms that this is not just our imagination: corporate earnings have never been this far out of line with expectations.
Data out of the team at Refinitiv published Thursday showed the rate at which companies were beating estimates and the magnitude by which they were beating expectations through Thursday morning’s results were the best on record.
https://www.mac-it.ch/forum/showthread.php?tid=464305
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http://sane11.com/showthread.php?tid=415
https://thugcopz.com/showthread.php?tid=1085
https://kamera.al/showthread.php?tid=1272
So earnings are beating the street’s guesses more frequently, and at a higher differential, than ever? That makes recent stock-market appreciation less worrisome, I suppose. And it helps explain why startups have been able to raise so much capital lately in the United States, as they have in Europe, and why private-market investors are pouring so much capital into fintech startups. And it’s probably why Zomato is going public and why we’re still waiting for the Robinhood debut.
This is what a market feels like when the underlying businesses are firing on all cylinders, it appears. Just don’t forget that no business cycle is unending, and no boom is forever.
An insurtech interlude
Extending The Exchange’s recent reporting regarding fintech funding, and our roundup from last week of insurtech startup rounds, a few more notes on the latter startup niche, which can be broadly viewed as part of the larger financial technology world.
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https://forum.fusioninventory.org/showthread.php?tid=3781
https://breachpvp.com/forums/showthread.php?tid=749
http://beta.cqpolska.pl/showthread.php?tid=20116
This time we’ll hear from Accel’s John Locke regarding his investments in The Zebra — which recently raised even more capital — and the insurtech space more broadly.
Asked why insurtech marketplaces like The Zebra have been able to raise so very much money in the last year, Locke said that it’s a mix of “insurance carriers […] finally embracing marketplaces and willing to design integrated consumer experiences with marketplaces,” along with more consumer “comparison shopping” and, finally, growth and revenue quality.
The Zebra, Locke said, is “still growing north of 100% at ~$120M+ revenue run-rate.” That means it can go public whenever it wants.
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