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- Disgraced WeWork founder is in full Flow
Disgraced WeWork founder is in full Flow
Also in today’s edition: Indian football scores own goal; Chinese vessel docks in Sri Lanka; The fall of the six-day work week
Dinesh Narayanan & Roshni Nair
August 17, 2022
Good morning! Tesla CEO Elon Musk has a dream. And he's put forth his thoughts on sustainable energy, brain implants, and space exploration in a column for a Chinese magazine helmed by—wait for it—the country’s internet watchdog and censorship agency, according to Bloomberg. His ambitions to win friends in the country aren't surprising. China is considered to be the world’s biggest market for EVs. This move doesn't exactly win him applause, given that he's a self-appointed free speech warrior. Just another day in Musk's life.
Hello readers, The Signal team has had its nose to the grindstone to keep you up to date every day. It is taking a breather this week owing to the series of public holidays. You will still get your daily fix at the usual time. Only a bit shorter than usual.
The Market Signal*
Stocks: Indian equities ended the day with gains, even as China's central bank made an unexpected cut in its interest rates on Monday. This also prompted a fall in oil prices. India's July wholesale price index-based inflation slumped to a five-month low of 13.93%.
Early Asia: The SGX Nifty soared +0.14% at 7.30 am India time. Nikkei 225 started the day on a high note (0.79%). The Hang Seng Index trudged along (+0.060%).
VENTURE CAPITAL
Andreessen Horowitz’s Flock & Flow
WeWork co-founder Adam Neumann could not have scripted a better comeback for himself. Neumann, shown in the Apple TV series WeCrashed as someone who could “manifest” deals out of thin air—or vacant buildings—has just got a $350 million infusion from blue-chip venture capitalist Andreessen Horowitz into his newest and vaguest venture, Flow.
Typical of Neumann, details of the business are hazy except that it would involve him transferring 3,000 homes he owns to Flow.
Andreessen Horowitz is also an investor in Flock, a platform that aggregates landlords who give up titles and management of their properties to the company in exchange for shares and a regular payment instead of rent.
The Signal
Irrespective of how the VC wants to spin it, the investment in Adam Neumann is no disruption. It is a real estate play where the supply is cornered by a few, beginning in the wake of the subprime crisis and continuing through the pandemic. With cost of living being what it is and perspectives about workplaces changing post-pandemic, the investors may have miscalculated the promise of real estate. They may even be staring at a bubble and perhaps want to exit before it is too late. Adam Neumann himself owns 3,000 homes in places such as Miami, Atlanta and Nashville, locations already saturated with investor-owned properties.
Neumann is perhaps the best man investors can get to dig the industry out of the hole. Marc Andreessen said as much in his blog post. It appears the VC wants him to spin a model with bundled services that can defray the cost for property users while maintaining healthy returns to investors. Success can wash away his WeWork stains.
SPORTS
Indian Football Gets The Boot
FIFA has banned the All India Football Federation (AIFF) on grounds of “undue influence from third parties”.
Why? The Supreme Court had disbanded AIFF in May 2022 for not electing a replacement for former president Praful Patel. It appointed a Committee of Administrators (CoA), whose own formation of an advisory council led to drama between the old and new guards. The CoA then blamed Patel for playing a “duplicitous role”.
None of this went down well with FIFA, which wants the CoA dissolved since its statutes require member federations to be free of political and legal interference.
Fallout: Apart from disbarring India from hosting and participating in the upcoming U-17 women’s World Cup, the move bans domestic clubs from registering new foreign players (which in turn could affect sponsorship value). National players cannot play international matches till the suspension is lifted.
Domino effect: On Tuesday, the Delhi High Court referred to the Supreme Court order (All India Football Federation vs Rahul Mehra) to place the Indian Olympic Association’s governance with a CoA.
A MESSAGE FROM THE SIGNAL DAILY
Companies may risk losing out on talent. The six-day work week is getting a 👎🏻. Job seekers in India are prepared to turn down an offer if the employer follows a six-day schedule instead of the popular five-day-a-week format.
After much dilly-dallying, Sri Lanka supported Chinese interests over India's security concerns. The Yuan Wang 5 scientific research vessel, also suspected to be a spy ship, has docked at the cash-strapped island nation's Hambantota port. India is miffed but did Sri Lanka have a choice at all? Tune in as we speak to N Sathiya Moorthy, Head of ORF’s Chennai Initiative, for today's deep dive.
The Signal Daily is available on Spotify, Amazon Music, and Google Podcasts or wherever you listen to your podcasts.
FYI
Bought: Razorpay acquired Ezetap in a $100-120 million cash-and-stock deal. This is the fintech major’s third acquisition in 2022.
Going public: Digit Insurance, backed by Virat Kohli and Canadian billionaire Prem Watsa's company Fairfax, filed its DRHP with SEBI for a ₹5,000 crore (approx.) IPO.
Damage control: Tiger Global has cut back portfolio investments in Robinhood, Zoom, Coinbase and a raft of other companies after taking a beating in the recent tech rout.
Bad Signal: The data of at least 1,900 users of privacy-friendly messenger Signal was potentially breached due to a phishing attack on Twilio, which verifies logins on the platform.
Streaming shakeup: Warner Bros Discovery laid off 70 HBO Max employees. Activist investor Third Point bought new stake in Disney and proposed spinning off its ESPN unit.
Tuned in: Tencent Music beat revenue estimates with an 18% increase in audio subscriptions, driven mostly by original content.
New horizons: Walmart-backed digital payments company PhonePe is looking to enter the e-commerce sector with the government’s Open Network for Digital Commerce (ONDC).
FWIW
Up the charts: The stabbing attack on author Salman Rushie has renewed readers' interest. The Satanic Verses is topping Amazon’s paperback charts and the Kindle and audiobooks sections. Rushdie’s other work, Midnight’s Children, is also finding more takers.
Spinning a tale?: A new study has found that jumping spiders may dream just like us. They experience REM-like behaviour—which includes leg twitching and curling—just like humans, dogs, birds and even cuttlefish. The findings are exciting, but no guarantee that the critters are indeed dreaming.
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