Boomtown – Airbnb, Rivian, Roblox and Crypto

Bryce: [00:00:16] Welcome to another episode of Equity Mates, a podcast that follows our journey of investing, whether you're an absolute beginner or approaching Warren Buffett status. Our aim is to help break down your barriers from beginning to dividend. My name is Bryce, and as always, I'm joined by my equity buddy Ren. How are you going? 

Alec: [00:00:30] I'm very good. Bryce. Great to be with you for another episode. A lot to get through today. 

Bryce: [00:00:35] A lot to get through. Today, we're going to talk a little bit about any updates to our portfolios, the news around Elon Musk, Rivian going public and the latest in the land of crypto ETFs and products. 

Alec: [00:00:48] Yeah, pretty big. Pretty big. 

Bryce: [00:00:50] Before we get going, we want to announce the Equity Mates Awards and this is something that we're going to be doing towards the end of this year just before we all go on holidays, and we're pretty excited. We've got a number of categories that we're looking for nominations from the Equity Mates community in particular areas. So we've got Investor of the Year, we've got CEO Business Leader of the Year. We've got community member of the year as well as ETF of the year and Product of the year. The way it's going to work is we want the Equity Mates community to nominate in those particular categories over the next couple of weeks. Link to do that will be in the show notes or on our Instagram page. And then from there, we will have a list of finalists to be announced week commencing 13th of December. So pretty exciting. 

Alec: [00:01:39] The Equity Mates community is one of the biggest retail investor communities in Australia, and we figured let's use the power of that community to award some some guests who have been on the show or some product issuers that we all like ETFs is such a hot topic. They've got their own category. Yes, we see this is becoming the most prestigious award in the retail investor landscape. We say BetaShares VanEck ETF Securities BlackRock competing tooth and nail to an ETF of the year every year. Yes, but it should be a bit of fun. It should be an opportunity to look back on the year. That was because a lot has happened and it's an opportunity to share some of the great work that all of the Equity Mates podcasts are doing, you know, Investor of the Year CEO Business Person of the Year. You know, it's not just us that are interviewing some of the best in the business. It's you are in good company is talk money. To me, it's all of the other podcasts in the Equity Mates stable. So really looking forward to seeing what the nominations are. Yeah, Bryce cannot be nominated for an investor of the year, despite roadblocks his quarterly update. But we'll get to that. But yeah, jump in and have a look. Nominate your mates for community member of the UM and should be a bit of fun. 

Bryce: [00:02:52] That's it. So full instructions and how to do it are on the form. As I said, link in these show notes or head across to our Instagram page. There'll be a poster with Link in Bio, so we'd love to hear your nominations and looking forward to seeing what comes of it. But Ren, let's start with the news of last two weeks ago. The came out in the press and that was that Equity Mates media completed a seed round.

Alec: [00:03:18] Yeah, I think let's just not. So obviously there was an AFR article. We're really excited about it. We know some people want us to talk about it, and we know that other people will think it's just complete self-indulgence to talk about it. So what we're going to do is at the end of this episode, we'll chat about it. We'll give you guys an update on how it happened and what the plans are. But if you just don't want to hear about the Equity Mates business story and you just want to focus on the markets, you can just turn the podcast off early. So we'll get to that. But I just wanted to nod to it that we hear the people that are asking for it, and we also get the sense that some people just don't want it. So we'll jump to the end if you want to skip to it. 

Bryce: [00:03:59] So let's turn to chatting about our portfolios. This is a podcast about tracking our journey of investing. So what's anything great happening on your end?

Alec: [00:04:10] This is all you. You've put all the notes in here. I'm saying a number of companies, some of which I own, one of which I know knew that you wanted to talk about because it great quarterly report. So I think this is going to be a hand them over to you and let you go situation. Sure. 

Bryce: [00:04:25] Well, one company that I have been buying sort of averaging into over the last year or so, probably since earlier this year was Airbnb, and I've taken positions in it quite regularly thinking that, you know, once Covid sort of sorts itself out and over in America, it was sorting itself out quicker than it was here in Australia, and the reopening was happening that it was going to be a good news story for Airbnb, and it came out with a pretty phenomenal Q3 earnings report, 

Alec: [00:04:55] which some people might be surprised by given Covid and lockdown. 

Bryce: [00:04:59] Yeah, but it's it's not only a good one, it's their best ever quarterly report. So they had revenue of two point two billion, which was their highest ever thirty six percent higher than Q3 2019. The net income of. Hundred and thirty four million was the most profitable quarter ever. Nearly four times larger than a year ago, and it's off the back of the changing way in which people are using Airbnb coming from the effects of Covid. 

Alec: [00:05:28] Yeah. Forget this as a holiday platform, this is now work remote platform. 

Bryce: [00:05:33] Yeah, exactly. So they've brought in a couple of features and then they've also noticed, to your point, Ren how people are changing the way that they use Airbnb. So a couple of things like the I'm Flexible feature, they say, is now becoming incredibly popular. Essentially, what it does is now that people don't have to work in the office all the time, they can just say that I want to be away for a couple of weeks, roughly in the first half of the year or in January, or whatever it may be. You just click on flexible and it'll give you appropriate dates. Yeah. And then also, people are now spending more time at Airbnb's longer term. 

Alec: [00:06:08] Yeah, yeah. We've done a couple of campaigns for Airbnb this year and it's been noticeable. Well, it was noticeable for us that all of the campaigns were about getting more hosts on the platform. They just there was no need to advertise the fact that Airbnb existed and that if you wanted to book a holiday, you should start with Airbnb. For me, that was just such a clear indication that the consumer behaviour of If I'm going away, I start with Airbnb is so ingrained. Yeah, it's definitely ingrained with me like I never would go to like hotels. Combined stockbroking. Yeah, which all old. Great business? Yeah. But for me, the attraction of staying in a house compared to a hotel is just so much better. The locations about everything you get is better, and I think for people of our generation that is just so ingrained that Airbnb's only challenge is getting more supply of houses onto the platform. 

Bryce: [00:07:04] Absolutely. And the good news is that there is a significant increase in hosts coming onto the platform. 

Alec: [00:07:09] Release advertising campaign work. 

Bryce: [00:07:11] Yeah, advertising is doing well. Yeah. So they made note in there and in their Q3 report that they're pleased with the amount of supply that's coming in off the back of, I guess, the work that they're doing to promote that and tell people that you can earn an extra dollar by leasing out your home in those sorts of things. So look for me, it's just a nice to see. It'll be interesting to see how it continues when more countries around the world start opening up and international borders open up and the impact it's going to have on Airbnb, but pretty strong. Report your report. Yeah. Speaking of strong reports as well, Ren now this is not in my portfolio, regrettably, but it is one of the stocks of the year from May and I won't touch on it a lot. But for those following our Stock of the Year competition, Roblox had another very impressive Q3 report and it jumped 40 percent overnight. It came off the back of revenue, up 140 percent and also ours, engaged with nine point seven billion hours, engaged an increase of almost 100 percent year over year. So I'll do a bit more of a deep dive into that when we have our stock 

Alec: [00:08:21] answer more of a Deep Dive, to be honest, I think we get it. You know, Roblox is adjacent to the metaverse. Zuckerberg starts talking about the metaverse. There's a metaverse, but is it sustainable metaverse? Those numbers and sounds like a fleeting curiosity, you would say. 

Bryce: [00:08:39] Another update from me is I am now no longer hold any Afterpay. I'm totally out. 

Alec: [00:08:47] Well, there you go. Don't believe in Square. 

Bryce: [00:08:50] No. Well, I don't want to have those those shares at the moment. I think that the money could be 

Alec: [00:08:57] better spent elsewhere as a long term shit square shareholder. I think you're mistaken that physical. 

Bryce: [00:09:03] Yeah, yeah. I can get into share. I can get back into school at some point.

Alec: [00:09:06] But I figured how how did you put some money aside for tax?

Bryce: [00:09:10] Yeah. Well, I've actually been selling out of Afterpay for probably 12 to 18 months. So yes, is the short answer. But yeah. Scenario Afterpay. Will I get into square at some point? Potentially. I don't know. But your shareholder? 

Alec: [00:09:24] Yeah, have been for a while. Yeah, yeah. Maybe I'll sell because it's acquiring Afterpay. True. 

Bryce: [00:09:32] And one and one other thing about two years ago, I bought into a Russell 2000 index ETF, and I've just been averaging it for people 

Alec: [00:09:41] who are unfamiliar. Russell 2000. Well, that's why I 

Bryce: [00:09:44] wanted to try. That's what I wanted to bring it up. So the Russell 2000 is essentially a small cap index. It's the bottom two thousand smallest 2000 stocks in the Russell 3000 index, which is, I think, the 3000 largest stocks in the United States, something along those lines. 

Alec: [00:10:00] So if you bought it, you should know what it is. 

Bryce: [00:10:02] Well, it's it is. It's the 2000 smallest small cap stocks, essentially, and it's been bubbling along for a little bit and kind of not doing a lot. But since the end of Covid, it's just kind of gone. Gangbusters, as has the rest of the market, but I just wanted to kind of pointed out if people were looking for a sick of having ETFs in the top end of town, then there are alternatives to get access to that bottom small cap exposure, which I'm kind of enjoying at the moment. 

Alec: [00:10:29] Yeah, my my only reservation with small cap ETFs is for every great company that is rising through the index. There are terrible companies that are falling through the index as well, and that's the same in in bigger ETFs. But when you're through 30 stocks in the in the index as a lot further to fall, there is a lot further to fall. 

Bryce: [00:10:48] Yeah, yeah, I just like it. It's part of the market I want access to without having to pick individual stocks. 

Alec: [00:10:56] And you don't you don't want to think about active management. 

Bryce: [00:10:58] I can't justify it at the moment. It's just it's just something 

Alec: [00:11:02] that you can't justify it. 

Bryce: [00:11:03] I can't justify paying the fees for active 

Alec: [00:11:05] management, even if you find one that outperforms net of fees. 

Bryce: [00:11:10] I mean, over the last few years, it's tough to find something like the 

Alec: [00:11:12] last few years is tough.

Bryce: [00:11:13] Yeah. So it's like it doesn't feel like it's the right time to do that. Okay. Yeah, I don't know. What do you think? 

Alec: [00:11:22] I think now is probably exactly the right time to do. Well, yeah, because I'd like every indication is saying that what we're seeing in the markets at the moment isn't sustainable. We just saw sixty six point two percent inflation out of the US, where this is as close to when everything bubble as we're probably going to get into. Like there was a conversation between Seth Klarman and Stanley Druckenmiller, like last week where they were talking about how everything is in a bubble because everything is priced off. The price of bonds and the price of bonds has just been so distorted that everything is just way too inflated, regardless of like, whether this is an everything bubble or not. I just don't think the whole world index returning twenty eight and a half percent a year is sustainable. No, I think it will revert to the main. And I think that when that happens, active management will start to outperform indexes again, like it always happens. It moves in cycles. Yeah, sometimes the index outperforms and active management suffers. And other times, active management outperforms, and the index doesn't do as well. And so for me, it's like, you don't want to chase performance. You don't want to you don't want to say, well, the index has done incredibly well the last two years and that that's going to keep going. You want to say what's going to happen next and for me? Obviously, I'm still going to hold a whole bunch of ETFs that core part of my portfolio is just dollar cost, averaging a lot. But for me, I think if things start to get in trouble, if interest rates have to rise quickly to deal with inflation and then that changes the price of assets meaningfully and quickly, that's probably where you want active management. 

Bryce: [00:13:05] Yeah, it's just so difficult to like. This could go on for another five years.

Alec: [00:13:11] I just, yeah, it could. But like Will. The Fed is tapering. The inflation is hot in the US and Europe. I think you're okay with it like four percent. So not as hot, but still pretty hot. You know, and this whole like inflation is transitory. Conversation, I think, is I think

Bryce: [00:13:28] that message is starting to change. It's gone. 

Alec: [00:13:30] Yeah, I think as soon as Labour. So when you look at like the inputs for inflation, like shipping costs, raw material input costs, like all of that stuff, you know that the cure for high prices, there is high prices as prices go up, more producers, more capacity comes into the market and prices come down. But labour is the one thing where you know, when prices are high, they are very sticky. It's very hard to pull back a, you know, a wage hike for workers. And so I think we're seeing an incredibly hot labour market in the US, and I think that is the part where inflation will no longer be transitory. 

Bryce: [00:14:07] So maybe just double down on on my active management then.

Alec: [00:14:11] Well, you just said you didn't want to do that. 

Bryce: [00:14:13] No, not in small caps. Not anymore. Okay. 

Alec: [00:14:16] Fair enough. Well, I don't have a small cap active manager in my portfolio. I was actually looking for one with the NAB equity build up. Yeah, yeah. And we told NAB we would stop mentioning the equity build-up because so many people have applied that they can't keep up with applications. So apologies now. But I was looking at the list of approved investments for the equity builder because there are few small cap managers that we've spoken to over the journey at Equity Mates that I just think are unbelievable. One that comes to mind and this is by no means the only one or like a specific recommendation. But every time we speak to Tobias Box, I'm just blown off. Bill Yeah. And his his fun and Nick Craigan Emerson, fella. Yeah, now that just blown away every time we spoke to them both. Neither of their funds are listed in the NAB Equity Building products. And when I was flicking through it, there's a there's a lot of large cap managers. But for me, that's not that exciting. A lot of Australian equity managers. For me, again, not that exciting. And then a whole bunch of managers from firms that I just don't really want to put my money with like, yeah, yeah, there's like two pages of AMP managed funds. And also,

Bryce: [00:15:30] it's it feels a little outdated as well. Like all these great managers that we're speaking to who are running these sustainability funds, the Mary Mannings, for example, all their stuff, not on there, either.

Alec: [00:15:39] So no, Mary Manning is there, 

Bryce: [00:15:41] not the sustainability, 

Alec: [00:15:42] but the affinity global is there and she's a portfolio manager there. Yeah, but 

Bryce: [00:15:48] you want this. I want the sustainability one. 

Alec: [00:15:50] Yeah, well, we did raise that with Marianne. We spoke to the global one. She is a man. I did this because, yeah, I went deep on some of the stuff. She's okay. 

Bryce: [00:15:59] Yeah, long story short, I'm always a lot happening in our portfolio here. 

Alec: [00:16:04] I think for me, I think for me, the takeaway from that whole discussion is there's no like the beauty of investing is you don't have to go all in on. One thing like that whole conversation about is the index is going to outperform or as active management going to outperform. You don't have to pin your colours to one side of that debate and not move. Like I made the case that I think active management might be due a moment in the coming years, but I can just put my money with both like I can just I can just put some in the indexes, put some with active managers I like and just keep dollar cost averaging into both also saving some money to put in individual shares. When I when I want to and at the end of the day, whichever outperforms, I'll have some exposure and the most important thing is being invested at all gets you like 80 percent of the way there. Yeah, whether you get the market return or the market return plus two percent alpha like the the important thing is that you're growing your wealth and you're exposed to the market rather than sitting in a savings account like that's what matters. Everything else is talking on the margins. 

Bryce: [00:17:14] Yeah, agreed. So for those who are interested in the Russell 2000 ETF, it's a Vanguard ETF and it is vital. Why so they go nice? Well, let's move on Ren. Let's do it. What else is happening? Rivian went public overnight. We're recording this on the 11th of November, and for those that are unaware of what Rivian is, let's start there. What is it? 

Alec: [00:17:40] It is an electric truck or an electric van. Maker that has never made a dollar in its life. 

Bryce: [00:17:47] Never made a dollar in its life, it listed on the Nasdaq last night. Drive in is the ticker and 

Alec: [00:17:54] what an IPO. Yeah, well, I think it was chasing a $65 billion valuation. I think it came in higher than that. 

Bryce: [00:18:00] So without making a single 

Alec: [00:18:02] cent with no revenue. It's 22 percent owned by Amazon, five percent owned by Ford. And whilst it doesn't make any revenue, Amazon have committed to buying 100000 electric trucks by 2025. And as part of the deal, Rivian can only sell electric delivery vans to Amazon for the next four years. So basically, no one else can buy it. But, you know, Amazon's big customer to, I guess, advertise these vans when Jeff Bezos went to space in July. Yeah, he rode in a Rivian prototype electric truck to the launch pad. So like Amazon and Rivian are pretty tied at the hip, and that's what's getting people really excited about this company. It actually raised $11 billion, and that puts it in the top 10 American IPO of all time, according to Dealogic. In terms of the amount of money raised at the IPO, not in terms of valuation, but in terms of the amount of money they raised from investors. So it was like a marquee IPO like big, big, big deal. I think they were like 20 investment banks involved in the process. It's all academic at this point. 

Bryce: [00:19:13] Yeah. Well, I'm just thinking that like, surely they've they've got a production line going in like that. Well, in a 

Alec: [00:19:18] way that they've got a factory and they've got prior 

Bryce: [00:19:20] to 2025, they're committed to 100000 trucks. So in the next what, three years they need to to get that rolling out the door, you know, the challenges that Tesla face to get 100000.

Alec: [00:19:32] So yeah, 

Bryce: [00:19:33] it'll be interesting.

Alec: [00:19:34] Speaking of Tesla, we should talk about that, but let's close out Rivian first. Yeah, it will be interesting. So they're competing with Tesla, obviously, but there's a number of other competitors that are coming into this space. So all the legacy car manufacturers, the Volkswagens, the Audi, the Fords are all pushing into this space. And, you know, the electric SUV, the electric delivery van market will will be hotly contested. But then there's also new entrants are Fisker, which was an older electric carmaker back when Tesla was first kicking off the collapse. And then it's been revived. They're making an electric pickup truck. I'm pretty sure there's a China's NIO. There's a number of other electric car makers, so there's a lot of hype around Rivian. But I think the important thing to watch is the amount of competitors coming into this space because it's going to heat up when Scott Morrison is promising to put cash into electric vehicles. You know, the world is is in that direction. 

Bryce: [00:20:38] Yeah, yeah. So I just want to confirm they can only sell electric vans to Amazon for the four years post twenty twenty five. Wrong on that front right now. OK, interesting. So pretty big play from Amazon. Twenty two percent. It's interesting also that there's this focus on SUVs and pickups. 

Alec: [00:20:57] I think that's the especially in America. Like that's such that's the big car and category that Tesla haven't been able to crack. And because it's all, it's all of these technical things that, you know, like the power to weight ratio and the towing power. And, you know, like electric vehicles, batteries are heavy. They take up a lot of space in the car and they work for sedans a lot better than they work for pickup trucks or something like that. Yeah, that's why I like an electric big truck. You know, like without Bryce Australia stops. Yeah, I just know that's just not on the cards. Yeah, that's why batteries would be 

Bryce: [00:21:32] not, but just 

Alec: [00:21:33] because like the amount of batteries in. Yeah, yeah. So that's why hydrogen might make more sense for those trucks. So, yeah, it's a bit of a different technical, I guess, engineering problem. 

Bryce: [00:21:43] So if you're interested in the EV space as a lot of the Equity Mates community, then but you don't want to just buy Tesla if you missed the ASX week interview with you, Jane. He specifically spoke about a number of stocks to play the electric vehicle theme without having to invest in Tesla. So make sure you go back and have a listen to that really fascinating space. And as we've spoken to many experts, one that's playing an important part for our future. So before we hit a bit about the crypto space Ren, let's stick on the theme Tesla. 

Alec: [00:22:19] Yeah, did you say on Elon's Twitter? 

Bryce: [00:22:21] Paul Allen's putting up to the polls on whether or not he should sell billions of dollars or 10 percent worth of his company? 

Alec: [00:22:28] Yeah. Did you vote? No, I voted. Did you? Yeah. Would you vote? I voted no. I said he shouldn't sell. Did you?

Bryce: [00:22:34] Did you leave a comment? 

Alec: [00:22:35] No, no. So for people who missed it, Allen were basically put up a tweet saying, I've heard the debate around taxing. Capital gains in the U.S. or unrealised capital gains in the U.S. and to prove a point or whatever. I don't really understand the connexion, but he was like, I'll I'll sell 10 percent of my Tesla holdings. I guess so the government could tax it. And then it 

Bryce: [00:23:00] was also to do with the fact there's no income tax in Texas,

Alec: [00:23:03] though there's no state income tax. Yeah, there's federal income tax. OK. But no, the the Democrats have put a proposal on the table to tax unrealised capital gains. So right around the world, you get taxed capital gains when you see a taxable event, when you sell an asset so you can hold a share for five years and you only get taxed when you sell those conversations in the U.S. about every year, that's measuring that capital gains. And regardless, if you've sold it or not, the tax, the the difference, 

Bryce: [00:23:36] what you get, you get a re were not a rebate, but you can claim the loss if it's a I 

Alec: [00:23:40] guess so. Yeah, it's a bad. Yeah, I guess so. Yeah, that's ridiculous. And the logic there is, you know, the business must have held equity in their companies for 20 years and have never been taxed on it. And so that's the debate over that. Let's not get bogged down in that. It does feel like it's a fraught proposal. Yes, I must put this Twitter poll up said I'm going to let Twitter decide if I should sell 10 percent of my holding and people could vote. And I think like three or four million people ended up voting maybe more about 55 to 45 said he should sell. If I was a Tesla shareholder, so I'm not a, you know, 

Bryce: [00:24:19] but I'm I want to be, 

Alec: [00:24:20] I would be pretty annoyed. I would be like Alien for so long has been like all of my wealth is tied up in SpaceX and Tesla and like a few of the other companies. For context, the numbers, there's some different reporting, but I think Elon owns about 23 percent of Tesla. So and given it's called a trillion dollar company phase, I'm not so 230 billion. Yeah. If he sells 10 percent of that, that's about twenty three billion. Yeah, yeah. And then I think that we did the maths based on the long term capital gains right in the US, it would have been about between five and six billion in tax. The government would have taken so 23 billion to sell. The Twitter poll said yes. No one knows yet. Maybe by the time this is out up, he will have had to have reported it. But speculation is he sold a whole chunk Monday morning. 

Bryce: [00:25:14] The stock dropped a little five percent, I think 

Alec: [00:25:16] even more than that terrible internet cent. But the volume the daily volume was just it peaked a lot higher than the average. Yeah, wow. The other thing could be a lot of people were trying to front run Alan selling. 

Bryce: [00:25:29] True, true. Get out. Well, yeah. And his brother sold 

Alec: [00:25:32] and taking it from running. 

Bryce: [00:25:33] Yeah, his brother got out. I don't know, got out 

Alec: [00:25:36] to the tune of one hundred and fifteen million dollars. Yeah, yeah. 15 percent of his holdings. 

Bryce: [00:25:39] Yes, it's incredible stuff.

Alec: [00:25:42] Here's the question, though. So do you remember the funding secured tweet? Yeah, yeah. Yeah. So 2018, Elon tweeted, taking Tesla private for $20 a share funding secured Tesla was trading a lot lower than for $20 a share at that time. The essays say they find him. They slapped him on the wrist, and they said any tweet that had the possibility of moving the Tesla share price had to be reviewed by Tesla. Lawyers like that was part of the settlement. So regardless of if this was insider trading, if this was, you know, market manipulation or anything like that, this was a tweet that would move Tesla's share price. I don't think Tesla's lawyers would have reviewed it all. 

Bryce: [00:26:23] They've reviewed it and just go on just cowboy. 

Alec: [00:26:26] Let's just go for it. 

Bryce: [00:26:27] And I just go, There's no issue here. 

Alec: [00:26:29] Maybe. But he is. So as part of that settlement in 2018, Elon had to pay a $20 million fine. Tesla had to pay a $20 million fine, but Elon didn't want Tesla to have to pay for his mistake. So he organised for Tesla to sell him $20 million worth of shares, so he could basically give the company $20 million to pay that fine. Have a look at the price chart of what $20 million worth of Tesla stock in 2018 would have done to today. True. True. Very good and very good investment.

Bryce: [00:27:03] Yeah. Wow. Look, it's all happening with Elon. It's just I love following him on Twitter. There's always something going on, and I just always remind myself that the marketing spend of Tesla as an organisation is $0, and it's well, and having a CEO like him is 

Alec: [00:27:21] that is that true? They don't do any marketing, no marketing. That's pretty impressive. 

Bryce: [00:27:25] Yeah, they just don't spend a dime.

Alec: [00:27:27] I guess they got showrooms. They've got Elon Musk. Yeah, but they had that showroom in the city. 

Bryce: [00:27:33] Yeah, yeah. But they're not like, Have you ever seen a Tesla ad on TV? 

Alec: [00:27:37] Yeah, true. Yeah. 

Bryce: [00:27:38] Have you ever seen anything in magazines that don't do? 

Alec: [00:27:40] Isn't isn't. Isn't that the Lamborghini quote about? Like the CEO of Lamborghini said, we don't do TV ads because our clientele. Somebody dies. Maybe that's the same as 

Bryce: [00:27:50] well as some media channel that we don't know about. 

Alec: [00:27:52] Yeah, yeah. Yeah. Billionaires only dot. 

Bryce: [00:27:56] All right. Ren quickly. Singles Day is the today the day we're recording 11th of November. It's the world's largest retail event of the year over in China started as a way of celebrating single people. 

Alec: [00:28:10] Yeah, I think, yeah, called Bachelors Day to this day. Yeah, Alibaba really pioneered it. Well, it was that they started it and it is unbelievable. But this year, Singles Day has a twist, and I think it shows a changing Chinese corporate landscape. But let's start with the numbers. Last year, Alibaba had $78 billion in sales in one day. Yeah, it's 

Bryce: [00:28:34] unbelievable. 

Alec: [00:28:35] Let's put that in context, Kohl's does just shy of $40 billion in sales in a year. So Alibaba did in a day what Kohl's Dollars Dollars? Yeah, yeah. It's unbelievable that it's just an ungodly amount of money. Five hundred and 83000 orders were packed per second per second. You're not responding, but post-second. 

Bryce: [00:28:58] I'm speechless. 

Alec: [00:29:00] And like influences and a whole bunch of other people get on the action in on the action. One influencer sold $1.7 billion worth of products in a day. Yeah, imagine like. The name and influence, like the inspired unemployed sewing $1.7 billion worth of 

Bryce: [00:29:20] evidence, do anything ever again. Yeah, it's fascinating. And look, it's led to the huge Black Friday sales over in the states and a bunch of other online retailers trying to get in on the action as well following suit. Done, Amazon do the same thing they do the massive one day. Well, now it's four days.

Alec: [00:29:37] Well, I think Black Monday was pretty Singles Day because I think that was always like the post Thanksgiving like Christmas is here. Let's you know, and there was all those videos of people like lining up at midnight outside Wal-Marts and then those that stampede when the doors opened didn't know. They didn't know that. And then Black Friday, then and then all the e-commerce retailers and created Cyber Monday, Cyber Monday. So now it's like some sort of extravaganza. That's a lot of talk. But this year is different. So this year, obviously, in the past 12 months, we've seen China really crack down on big business, on the excesses of capitalism, on wealth inequality. And Singles Day is the symbol of a lot of these excesses of capitalism growth at all cost mentality. And so this year, the themes are green logistics, eco friendly products and consuming with care. In previous years, you know, Jack Ma has been on the stage with Daniel Craig and Scarlett Johansson and have had some of the biggest superstars in the world doing like a telethon to celebrate Singles Day. A lot of that has been stripped back. Well, Jack Ma, he's obviously not involved anymore. It's all. It's all very much toned down. Subdued are a real focus on charity. I think every time someone does like a social media mention of Alibaba's charitable contribution that donating like a one, some amount of money to charity. 

Bryce: [00:31:04] That seems a bit biased, to be honest. Mention us on social media and we'll give money to charity. 

Alec: [00:31:08] So mention our charitable efforts on social media and we can manage charity. 

Bryce: [00:31:12] Yeah, that's just marketing. 

Alec: [00:31:15] I mean, yeah, I guess it's marketing.

Bryce: [00:31:18] It's it's it's just a veil of. 

Alec: [00:31:20] But but I think I think the point is the marketing focus is different. The marketing focus is about like common prosperity, sharing the wealth rather than in previous years. Marketing was about like buy stuff. 

Bryce: [00:31:33] Yeah, I can see you trying to

Alec: [00:31:36] get these new products, but I can see 

Bryce: [00:31:38] why they're trying to go anyway. 

Alec: [00:31:39] It is worth noting this if you're interested in investing in China, like the dynamic is 

Bryce: [00:31:45] shifting nicely and well, let's take a quick break and then we'll chat about what's going on in the land of crypto. Ren, there have been some pretty big announcements in the world of crypto. We are in equities podcast, but given the enthusiasm for crypto in the Equity Mates community, we thought we'd briefly touch on it. The first big announcement was that Equity Mates media launched a crypto show. So we will have the host and CEO of Bamboo Tracy joining us in a moment to chat through what is going on in the crypto markets and also to briefly chat about the show. But Ren. Let's discuss some of the new ETFs that have hit the market because it's pretty big news. 

Alec: [00:32:24] Yeah, three ETFs hit the boards in the last couple of weeks one in the US, two in Australia that we think it's worth talking about. So first, ProShares Bitcoin Strategy ETF Ballito listed in New York. It tracks the Bitcoin futures market, then BetaShares Crypto Innovators ETF, C R, Y P and then ETF Securities Fintech and Blockchain ETF F Tech and FTA. Say so. Three Blockchain and bitcoin related ETFs have hit the market. My first takeaway is it's good that the regulators finally let some of those products love to see it go. Second takeaway is none of them actually track bitcoin.

Bryce: [00:33:08] No, no. So there was a bit of confusion around around that in our group, particularly a lot of people saying they were using it to dip their toes into crypto. That's not the case. You're dipping your toes into companies that either have, you know, use crypto in their balance sheets or are involved in the crypto universe or landscape in some way. But if you're thinking you're buying these to actually get exposure directly to cryptocurrencies, think again. We haven't hit that yet.

Alec: [00:33:34] Australia or the US hasn't hit that. I'm pretty sure there's a spot bitcoin ETF in Canada. Do your own research, but I'm pretty sure it's spot in Canada. 

Bryce: [00:33:43] Yeah. And my my kind of thinking around if you're going to buy an ETF, the tracks the price, spot price, bitcoin kind of buy the thing yourself. But that's my guess. That's my personal opinion. 

Alec: [00:33:54] This was this was going to be my question because we both own the assets themselves now the ProShares Bitcoin strategy, one that tracks the bitcoin futures market. I just don't. I'm sure there are use cases is probably hedging use cases. But for me, that's probably the least interesting because if you're at the point where you going to hedge, you can probably just actually hedge using the the futures market themselves. You don't have it wrapped up in an ETF. The Crypto Innovators ETF and Fintech and Blockchain ETF have exposure to companies that are building stuff in the crypto ecosystem. I guess this can become a conversation of Do you invest in gold or do you invest in gold miners? What would be the pros and cons of investing in bitcoin or investing in the companies that are building blockchain related businesses? 

Bryce: [00:34:41] Well, the same as if you're investing in gold or the gold gold miners. 

Alec: [00:34:44] Well, do you want to like give those that point? 

Bryce: [00:34:46] If you're investing in the asset itself, you're not actually investing in any sort of, well, I say asset, but you're not investing in in any sort of asset that's producing cash flow. Yeah, it's, you know, subject to supply and demand forces, that sort of stuff. But if you're investing in companies that are leveraging the underlying technologies, you're investing in an asset that's actually producing some sort of a cash flow and actually has some sort of a future behind it, I guess. 

Alec: [00:35:14] Yeah, I think the key for me is that if you're investing in the businesses, they're in some ways a leveraged bet on the asset. Because if bitcoin goes up and crypto goes up these businesses, their share price will go up because, you know, they are working in that space and they're exposed to it. Many of them hold the asset on their balance sheet. So in some ways, you get that a bit of extra leverage. But the other thing to keep in mind is that this space is changing so quickly. And like the winners of today in the biggest companies of today, may not be the biggest companies in the future. And so if you're bullish on bitcoin, bitcoin could go up. But some of these companies could fall off because they'll get disrupted by new entrants into the space. So I think you just have to be very aware of what you're buying because buying a company that's working in the space and buying the asset itself are correlated that they will move similarly, but they're not the same. 

Bryce: [00:36:09] So to hear more about this space, we should actually speak to some of the experts. So let's let's give Tracey a call. CEO of Bamboo Australia's only micro investing app focussed on cryptocurrency to get her take on what's going on in the markets. So now we're joined by Tracey, who is the CEO at Bamboo Australia's only micro investing app, focussed on cryptocurrencies. So, Tracey, welcome. Hi, guys. So we've just had a chat on the show about the new ETFs that have come to the market in the crypto space. We had the ProShares Bitcoin Strategy, the betashares crypto innovations in the ETF, securities, fintech and blockchain. Now, given you're currently in the middle of. Currency, land, what's your view about these new products? 

Tracey Plowman: [00:36:55] Well, look, I think it's really exciting and this type of approval is great for any Aussie investors who are looking to gain some exposure, I guess, to the crypto asset class and I guess even just learn a little bit more about the field itself. I guess this is good in a way that if perhaps your risk appetite isn't quite there yet and you don't want to join an exchange or an apple, you know, getting involved in the ETF represents another way in which you can invest in these technologies. I think you mentioned the better shares. I mean, net listing that one give you no direct access to Bitcoin, Ethereum, but an index of the underlying funds. So that offers good exposure, you know, to the global companies who are really at the forefront of the crypto economy. I think it's great 

Alec: [00:37:42] now, Tracey. Up Amber, you're focussed on giving people an opportunity to dollar cost average into the assets themselves. So I think I know the answer to this question, but I'm going to ask it anyway. Any interest in investing in these ETFs or will you be sticking to investing in the assets themselves? 

Tracey Plowman: [00:37:59] Look, to be honest, I wasn't giving it serious thought until I had a good read yesterday at how it was breaking all the trading volumes at the moment. You know, I think it was, you know, breaking news in a few hours of listing. I think even just yesterday I looked and it was seven percent up. So, you know, seven percent even, you know, the same kind of gains as we get in the crypto world on the small side. But now, look, I think my portfolio is already heavily weighted enough in these assets themselves, and I'm happy to stick with my current plan. 

Bryce: [00:38:29] You've just launched a podcast, which is awesome, the crypto curious. So can you tell us a bit about the show? 

Tracey Plowman: [00:38:38] The global crypto currency market just yesterday hit three trillion us for the first time ever. Wow. Yeah. Well, this, you know, this asset class isn't going away, and I think the education in this space isn't great. So when myself and co-host Blake and Craig entered the market years ago, we made many mistakes and we wish that we'd had a little bit more advice and guidance. That's kind of spurred us on to develop the podcast. So, you know, it's a place where we can break down all things crypto into simple and easy to understand concepts. We know that it can seem a little bit difficult these concepts to get your head around, but we try and put it into everyday terms and find things that make them a little bit easier to understand for those who are a little bit crypto curious, as we say.

Alec: [00:39:31] Well, Tracey, the podcast has launched incredibly well. You got to number one in the charts, which is love to say. 

Bryce: [00:39:38] Harry thought no pressure to hold it there, 

Alec: [00:39:40] but but you know what was perhaps the most ringing endorsement of your launch was I went around to dinner at my parents house last night and my mom was excitedly telling me all about DApps, which are built on the Ethereum blockchain because she'd listen to the first three episodes. So you're you've got a pretty, pretty broad reach. I imagine if you're getting my mom into cryptocurrency, 

Tracey Plowman: [00:40:06] getting the mums involved. Well, look, there's so many misconceptions out there. So we're hoping to help people with some of those. 

Alec: [00:40:12] Yeah. Well, what are some of the big myths you want to bust or some of the big misconceptions you want to correct on the show? Yeah. 

Tracey Plowman: [00:40:19] Look, there's there's plenty, and I think one of the main ones is people saying, I can't afford a whole bitcoin. And you know, to that, I say not many cans today. I think we're sitting at eighty eight thousand Australian dollars, so. And that's a big misconception for sure. And you have to buy a whole bitcoin to get started. And if anyone new to crypto that can be really off putting, but since you know bitcoin is digital, it can be divided into as many as 100 million pieces. You don't need to buy a whole one. You know, you can buy and sell and send and receive a tiny fraction. So another big one is and I get this every day is people thinking that they've missed the boat. You know, we're too late. You know, they say, you know, I should have bought last year when it was X amount. And to that, we say you'll be saying the same thing this time next year. It's never too late to average into the market, and we believe that, you know, we're very early into this overall crypto journey, especially when you look at things like the adoption numbers for the internet. You know, technology back in the early nineties, which is probably the closest example of this kind of, you know, adoption that was crypto. You know, we're really early. We're early adopters, so now's the time to learn. So join us on the on the podcast and start that journey. 

Bryce: [00:41:34] Yeah, love it, Tracy. I'm really enjoying the podcast as well and certainly going to learn a lot from you over the next. Well, however long this goes for, and I think you're right where it feels like where we are right at the start of this, and it's exciting to be able to unpack it every week. So the your fourth have. The site is live now it's looking at the bigger picture, a guide to altcoins, so if you're interested in that, head over to crypto, curious to check it out. And if you're also interested in dollar cost averaging into bitcoin and Ethereum and head over and have a look at the bamboo Afterpay Tracey. Absolute pleasure. Congrats on the launch and we look forward to keeping in touch and bring you on for a crypto curious update every now and then. 

Tracey Plowman: [00:42:12] Excellent. Thanks for having me, guys. Appreciate it. 

Bryce: [00:42:15] So Ren to close out. We did mention right at the top that we have completed a raise a seed round here at Equity Mates Media, which is very exciting and we've got a number of questions and things that we just want to make clear and clarify for those that are interested. So if you have made it to this part of the episode, then we're just going to spend a couple of minutes addressing some of those big questions and and why we did it and and sort of how it all happened.

Alec: [00:42:40] Yeah. So let's start with who invested because that's what the AFR definitely led with, and it's something we're really proud of and really excited by. On Magellan, the fund manager Larry Diamond, the founder and CEO, co-founder and CEO. A few other big names. The important thing to stress is that no strings attached. We're not going to be spruiking Magellan any more than we did naturally before they're investors. But yeah, this is this is about growing Equity Mates and they've all invested on that basis. I think for us, something that we're really proud of is that they're all former guests. Magellan to been on the show. Larry's been on the show, Charlie, he's been on the show. Everyone else has been on the show. And for us, that that means a lot because some of those people were pretty reluctant to come on in the first place. We chased Hamish Douglass for years before we could get him on. But then they very quickly realised the power of podcasting and the power of the Equity Mates community. So for us, that's really reassuring. But yeah, any thoughts that things will change, the content we deliver, what we say, how we say it, put them out of your mind because nothing's going to change. 

Bryce: [00:43:48] Yeah, this is just a really exciting time for us. We've been fortunate enough to be able to quit our jobs almost a year ago to the day, and this is now going to help us take Equity Mates to the next stage. You know, we're really passionate about making markets accessible, giving you guys the best access to experts and business leaders tools and resources as possible. And this is a way for us to continue to do that, continue to build Equity Mates media in a way that is going to support you guys on your investing journey. So to Ren's point, you know, it's it's certainly not. We're going to be endorsing any of our investors more than any of the other experts are people that we get on the show. All the commercial relationships, the sponsorships and everything are going to remain as they have since day one. So yeah, look, we're happy to take questions if you do have any. Hit us up at Contact@equitymates.com, but it's exciting times for us and I want to just say that it is off the back of the continued support from the Equity Mates community. Obviously, we wouldn't have been able to get here if it weren't for you guys who continue to listen to us week in, week out, but not only us, the rest of our community and the rest of our suite of shows as well. We now have seven shows in the network and we're going to continue to grow that. So thank you so, so much for being with us along the journey. 

Alec: [00:45:05] Yeah, nice one. I think that's a good place to end it. If people have questions, they can hit us up on socials or on email. But yeah, more of the same and more content, I think is really the takeaway. 

Bryce: [00:45:17] That's it, say, on Thursday. Hey, thanks for listening to this episode of Equity Mates. We love hearing from you, so drop us a line at contact@equitymates.com or even better, go to your podcast player and leave a five star review. Also, a reminder that the Equity Mates content train doesn't stop when you've run out of episodes to binge. We've got a brand new website, a Facebook discussion group where on Instagram, YouTube and slowly making our way as an influencer on Tik-tok. Well, that's Ren. So come and say hello and join the community. We'd love to welcome you. Until next time.