Featured Stories
Selling an Edtech Business: The PositivePsychology.com Exit
PositivePsychology.com, a mission-driven edtech platform used by 19M+ professionals, was acquired in an 8-figure deal advised by FE International. This case study covers their growth, decision to sell, and the exit process.
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WeWork Acquires Conductor: Newsletter March 9, 2018
WeWork has this week announced their acquisition of Conductor. Specializing in the improvement of SEO for brands’ online presence, Conductor will leverage this acquisition to invest in their platform and move into the enterprise content marketing and distribution space. With plans to release its own marketing cloud, the digital marketing subsidiary will continue to operate as its own business but will partner with WeWork to bundle the two companies’ services for enterprise partners. Conductor raised over $60 million in funding from investors such as Matrix Partners, FirstMark, Investor Growth Capital, Blue Cloud Ventures and Catalyst Investors, however the financial terms of the acquisition were left undisclosed. According to Conductor CEO Besmertnik, existing customers should only expect the product to improve as they continue to invest in the platform’s development.
Spotify Officially Files for IPO: Newsletter March 2, 2018
Spotify has this week officially announced its plans to go public. Targeting a c.$1 billion IPO, the Swedish music-streaming platform does not plan on fundraising ahead of the exit, but instead will undergo a direct listing wherein existing shareholders will sell shares to investors on the public market. Currently trading between $90 and $132.50 per share off-market, the company is valued at $23.4 billion in the top range, but is not certain this valuation will necessarily pertain to public listing. Documents filed for the IPO show that 2017 revenue came close to $5 billion, up more than 38% from the year before, while reported losses of $1.46 billion nearly doubled compared to $657 million the previous year. Both ad-supported and paying monthly active users for the streaming company have grown consistently over the last three years, with paying subscribers having grown at a faster rate.
Walmart Comes Up Short in Q4’17 Earnings: Newsletter February 23, 2018
Walmart’s shares fell more than 9% on Tuesday following lower-than expected holiday sales. Gross margins suffered due to the amount of promotional spending Walmart invested in competing with Amazon over the period, as well as investments in inventory that they hoped would resonate with consumers. It wasn’t all bad news, however: while e-commerce sales suffered—23% growth during the period compared to +50% last year—total revenue surpassed analysts’ predictions of $134.9 billion at $136.3 billion. Earnings per share were only $1.33 adjusted, however, compared to analysts’ expected $1.37, and net income fell 42.3% YoY to $2.17 billion due to Walmart’s heavy investments.
Market Confidence in Salesforce Prompts Shares to Rise: Newsletter February 16, 2018
Salesforce’s shares rose 3.76% on Thursday after Jeffries to upgrade the stock to “buy”. The report increased the target price to $132 per share, representing a 21% upside over the next 12 months. In its anticipation of Salesforce’s improved performance, the report considers robust new subscription annualized contractual value, as well as the company winning back customer favor over Microsoft. Salesforce’s stock is up 38.5% over the last 12 months, and the company’s full earnings report is set to release on February 28.
Brian Casel
“I couldn’t be happier with my experience working with FE. As a first-time seller, they guided the process brilliantly. The initial consult and valuation was spot on with the final sale price. Their responsiveness was outstanding. The whole process went smoothly. ”
EBay Drops PayPal as Default Payments Processor: Newsletter February 9, 2018
PayPal and eBay have announced another milestone in the ending of their partnership this week. Since 2015, PayPal has been strategically extricating itself from eBay and it has now been announced that eBay will be using a new default payment processor, Adyen, over PayPal. From a user perspective, the main benefit of Adyen on eBay is that it allows users to stay on eBay’s website while checking out, unlike PayPal, which redirects the user. This announcement comes after PayPal’s Q4’17 earnings report showed an increase in income to $620 million, up from $390 million a year earlier, but a rather underwhelming outlook for the first quarter of the new year. PayPal has made several strategic shifts in line with their divergence from eBay in the last several years, as they have prioritized the acquisition of small companies like Swift Financial and moved into B2C functions like facilitating payments between family and friends, as well as strategic partnerships with big names like Apple, Google and Mastercard.
Michael Frew
After 20+ years of experience designing, developing, launching, and maintaining both Enterprise-level software projects and SMB online cloud-based applications, SaaS entrepreneur Michael Frew, shares his experience buying a business with FE International.
Facebook Bans Cryptocurrency Ads: Newsletter February 2, 2018
Facebook announced in a blog post on Tuesday that the platform will no longer allow advertisements for cryptocurrencies or Initial Coin Offerings. In their ongoing attempt to limit scams and false information for users, the social media company has been increasing regulations to their advertising guidelines. As part of this effort, cryptocurrencies and ICOs have been categorized as untrustworthy since they are “frequently associated with misleading or deceptive promotional practices.” This news comes in what was an event-filled week for cryptocurrency investors, with the Commodity Futures Trading Commission issuing subpoenas to Bitfinex and Teather, and falling values which amounted to hundreds of billions of dollars in lost market caps.
Stripe Will No Longer Support Bitcoin Transactions: Newsletter January 26, 2018
Stripe announced in a blog post on Tuesday that the company will no longer support Bitcoin as a form of transaction settlement. Back in 2014, the payment processor was one of the first to allow merchants to adopt Bitcoin as a form of payment, with CEO Patrick Collison citing the importance of the cryptocurrency’s universal accessibility as the main motivation. However, “by the time the transaction is confirmed, fluctuations in Bitcoin price mean that it’s for the ‘wrong’ amount,” according to Tom Karlo, Payment Methods and Dashboard Product Manager. The transactions now regularly come with a fee in US dollars that makes Stripe nearly as costly as bank wires. Stripe no longer considers this to be a sound product or strategy. Therefore, the last Bitcoin transactions on Stripe will be processed on April 23, as the company works with merchants to wind down support for cryptocurrency transactions. Stripe remains very much involved with the cryptoeconomy, however, taking an optimistic stance on possible upcoming cryptopayment methods like Stellar (for which they provided seed funding), OmiseGO, Lightning, Bitcoin Cash, Litecoin, or another variant still to come.
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