Hey guys, I have a bit of a long DD on ACAC / Playstudios. You can read the text below. If you want to see the full post with all the nice pictures, you can check it out here. I was too lazy to upload each picture individually to Imgur. Apologies in advance.
I've seen numerous people on Reddit compare the ACAC / Playstudios SPAC to Skillz, and some even to Draftkings. I think this is mainly because they're all in the online gaming / gambling industry, but aside from that, the companies themselves are quite different.
I think a more apt comparison should be between Playstudios and Playtika (Ticker: PLTK), since they operate in the same vertical, compete against one another in mobile slots games, and Playtika has publicly available financial data in which I will be making comparisons against.
Playtika Analysis
You can find Playtika's prospectus here
First and foremost, Playtika is one of the leaders in the mobile casino space. They have an assortment of games, and they themselves are diversifying into more casual games (similar to what Playstudios says they are trying to do), but their bread and butter are casino games, and the ones that make the most money for them are slots.
Slotomania, House of Fun, and Caesars Slots are all mobile slots games, and as you can see from the above, they generate a significant portion of Playtika's revenues (roughly 50% of their 2020 revenues).
OK, so why do I keep bringing up Playtika? Well, they had a very interesting graph that shows how much of their revenues come from different segments of their user base, based on when they acquired those users.
What this chart is saying is that 45% of their revenues came from users acquired from 2013 and earlier!
This is insane! They have such high user retention and user LTVs, that they're still monetizing a portion of their users that they acquired from 7 years ago.
If we go up to 2017, then roughly 75% of their revenues come from users acquired 2017 and earlier!
This is important because Playtika's oldest games are all slots games. So this is telling us that users that play mobile slots games, they tend to stay with those games for extremely long periods of time, and if they do stick with them, they spend a lot of money! This is great news since the vast majority of Playstudio's revenues come from mobile slots games.
If you look at Playtika's financials, you'll notice pretty nice revenue growth. However, a lot of that is non-organic, and was accomplished through M&A. This was because in 2016, Playtika was acquired by a consortium of Chinese game companies for $4.4 billion (including Giant Network, a well known gaming company in China), and they need to make revenue numbers higher to have a better story to sell for the IPO.
And part of their strategy was to diversify into casual games, and they did so by acquiring about 15 companies since 2016, including Wooga (developer of June's Journey, a very profitable find hidden objects mobile game) and Supertreat (developer of Solitaire Grand Harvest, a profitable card game).
However, one of the caveats of casual games is that the ARPPU (average revenue per paying user) is lower, and retention is lower than casino games. I did my own calculations on Playtika's ARPPU for 2018, 2019, and 2020, and you can see the noticeable downtrend. This was obviously not disclosed in the prospectus. Only ARPDAU (average revenue per daily active user) was disclosed.
My belief is that even though ARPPU and retention are lower, maybe the market is giving a higher multiple to casual games. I believe that even though online gambling is beginning to see legalization in many states, and more and more people are starting to be open to it, there is still a bit of a social stigma associated with it, and certain investors may be wary to investing in a pure "casino" play. That's why Playtika is making such a concerted effort to move away from purely casino games, and positioning itself as an mobile entertainment company. Another reason is also the immense competition and high user acquisition costs, but Playtika has shown that they are more than able to execute on a long term strategy here.
Playstudios Analysis
Before jumping into anything else, I want to go straight to Playstudio's financials.
The reason is because I think there's a lot of fluff here, and I want people to know the bullshit. But even when you see through the bullshit, the downside is still mitigated enough to warrant this play.
So first off, take any numbers you see from 2022 with a grain of salt. No one knows what's going to happen this year, let alone two years in the future, and in my eyes, those 2022 numbers look extremely unrealistic. Revenue growth will probably not be that high, unless they make some big acquisitions, and EBITDA margin expansion probably won't be that fast.
Revenue Growth
Playstudios is planning on launching a Bingo and an RPG game, and their plan is to aggressively spend on UA (User Acqusition) in 2021. Their hope is that revenues will scale up with their UA, and by 2022, they can lower their UA spend a bit, and continue to monetize the new games exceptionally well, maybe at an even better rate than 2021.
I think this is a bit farfetched, especially in such a competitive space as Bingo. I've done analysis on Bingo games before, and some of those games have also been around for 8 to 10 years, and they can't expect to just launch a game and have it ramped up to their expected revenue in a year's time. Development for those games requires game designers, people who are very good at math, product designers, and a many other people, which can make the development timeline quite long (at least a few months, for a more finished product, I think at least half a year for these guys). I think a more plausible scenario is that they acquire a smaller Bingo player, and then begin optimizing that game, and add in their own loyalty rewards, as that's the quickest way to ramp up revenues post IPO.
My guess is revenues are not going to ramp up as quickly as they expect, and they'll see limited revenue growth here, and still mainly see some growth from better monetizing their slots players. I think by 2022, somewhere between $350 million to $400 million in revenues is more reasonable, and I'd probably lean towards the lower end of that range.
Margin Expansion
In terms of margin expansion, I think the decrease in cost of sales is doable. It seems like there is some extra fat there that they can trim as they scale. The cost of sales is mainly the tax that Apple and Google charges when users make a purchase through their respective stores, and this is a flat 30%. I doubt they'll get it less than 30% any time soon, but that will probably be through getting their whales to make purchases outside of the Google Play Store or App Store, and using a much cheaper payment processor.
I think a long term goal of 20 - 25% for UA spend is reasonable. I'm OK with these numbers, though they may need to spend more initially to ramp up new games. One of the benefits of their loyalty rewards program is that they can have higher retention, and this might be a way for them to lower their UA spend, since people may be more willing to tell their friends about a free trip or prize they won through a mobile game.
Another reason I'm OK with the UA spend is because it seems like they have a pretty knowledgeable UA team. I have access to App Annie, a data analytics company that tracks mobile apps, and I checked out the download history for POP! Slots, one of Playstudio's mobile games.
You'll notice that US downloads spiked quite a bit in March. This is right when COVID-19 was beginning to spike in the US, and people began working from home. In the mobile app world, many apps had spikes in downloads in March and April 2020 because there was a much larger pool of users looking to download apps. CPAs came down, and companies that had strong UA teams were able to capture a lot of these new users. Thus, this tells me that Playstudios UA team was at least aware of ongoing trends in the mobile app space, and they were able to capitalize by gaining more users during that period of time.
The biggest issue I have is with the "All Other Expenses." I don't know why it's this high (R&D and G&A shouldn't be that high), and Playstudios definitely needs to do some expense cutting here. While this has the most room to cut, it may be the hardest since I'm guessing a lot of that cost is from legacy employees. But if they can get this to around 30% by 2022, I'll be happy.
Playstudios Has No Daily Active Users (DAU) Growth
This is a common issue I see raised on Reddit and I want to address it here. Below is another chart from App Annie, which has DAU estimates.
As you can see, DAU has remained pretty flat for the past 2 years, roughly between 150K and 200K users.
But have you considered that revenues were actually increasing during this time? This means that Playstudios is becoming more efficient at monetizing their current users (getting more money out of older players), or their user acquisition team is targeting more profitable users.
And this is just how the game is played in the mobile apps world.
Users will eventually get sick of a game and stop playing. Not many games can count on users organically finding their game, and continuing to play indefinitely. To maintain a certain DAU, companies generally have to spend money on UA to maintain that user base. It becomes a business where you are calculating how much you are spending on UA, and whether the LTV and retention are good enough that you can make money in the long run from those users. You can think of it as an ROI on your marketing spend.
And this is especially true for mobile game apps. If it were a social app, then yes, something like the network effect can come into play, and UA spend would be much lower. But for Playstudios, maintaining a steady DAU is actually a sign that their UA team knows what they're doing, and they're able to maintain a profitable and highly efficient business. It's actually a positive that they can maintain their DAU, and even INCREASE their revenues during that period.
End Game?
I don't actually know how this will end up. I don't give price targets cause I have no idea how the markets will value this company. But I can provide a few data points so that you can make your own decisions.
From a multiples standpoint, Playstudios is cheap on a revenue multiple basis compared to Playtika, and is about the same from an EBITDA multiple basis.
I personally don't think that Playstudios is a play that's going to 5X. Hell, even 3X I think will be a stretch. But, they do have a loyalty program that will help lower their UA costs, and extend the lifespan of their users. And they are moving into more types of games to diversify their revenue source.
The reason I like this play is because I think the downside is heavily limited. The lifespan of casino slots players are so long, and the revenues are pretty stable (even growing), that there isn't an immediate risk that revenues will all of a sudden drop 30%, as is the case with lots of other mobile game companies. Add on top of this the potential for new revenue growth drivers from Bingo and RPG games, and the potential for margin expansion, that this is an easy 30-50% upside from current prices with almost minimal downside.
One last minor bit, is that I'm sure lots of people missed out on the hype surrounding Draftkings and Skillz, and I'm sure there are some retail investors that will look for any type of casino / mobile gaming / gambling deals, and may jump on this as well. My feeling is that there is also a potential upside from the hype or FOMO factor.
Anyway, this is my analysis on Playstudios / ACAC, hope you guys enjoy.
Disclaimer: I am not a financial advisor. These are my personal views and analysis on Playstudios. Please do your own due diligence.
Disclosure: I own 400 shares of ACAC.

...After his company went public. I had to include that in the title. Maybe now he won't be such a cheap bastard with his GMs. I had no idea Gilbert was now the second richest owner in the league.
Which made me wonder what other owners are worth (the title of this post was almost "why is Tilman Fertitta such a cheap bastard while Joe Lacob spends money like he thinks the shit's gonna rot?").
Which brings us to this handy Forbes list from March:
1. Steve Ballmer (Los Angeles Clippers): $51.4 billion
Ballmer scored a huge win this week for his dream of building a new arena. He bought the Forum for $400 million from the Madison Square Garden Company, which tried to block a new Clippers arena near the Forum in Inglewood, California.
2. Philip Anschutz (Los Angeles Lakers): $11.2 billion
Anschutz owns one-third of the Lakers, plus the arena in which they play, the Staples Center, in addition to the NHL’s Kings. \For those wondering, it's hard to find a reliable source on Jeanie's net worth but according to unreliable sources it's in the ballpark of $500 million*
3. Stanley Kroenke (Denver Nuggets): $10 billion
The real estate and sports mogul owns teams in the NBA, the NHL, the NFL, MLS and the Premier League.
4. Joseph Tsai (Brooklyn Nets): $9.9 billion
The cofounder of Alibaba Group completed his purchase of the Nets last year for $2.3 billion and bought the Barclays Center for an additional $1 billion.
5. Robert Pera (Memphis Grizzlies): $7.1 billion
Pera owns nearly three-quarters of wireless equipment maker Ubiquiti Networks. He was the lead investor in the Grizzlies purchase in 2012.
6. Daniel Gilbert (Cleveland Cavaliers): $6.2 billion
Gilbert made his first fortune from Quicken Loans, the largest online mortgage lender, which he cofounded in 1985 at 22 years old.*List is from March, before the IPO
7. Tom Gores (Detroit Pistons): $5.7 billion
Gores and his brother Alec are both private equity billionaires. The Pistons opened a new $90 million headquarters and training facility in September.
8. Micky Arison (Miami Heat): $5.3 billion
Arison’s net worth plummeted 33% over the past six weeks with the collapse in the stock price of Carnival Corp. The world’s largest cruise ship operator was founded by Arison’s father in 1972.
9. Tilman Fertitta (Houston Rockets): $4.4 billion
Fertitta furloughed roughly 40,000 employees at his casino and restaurant empire to curb the economic impact caused by coronavirus-induced shutdowns. His fortune is derived from his ownership of the Golden Nugget Casinos and Landry’s, a Texas-based restaurant and entertainment company.
10. Mark Cuban (Dallas Mavericks): $4.3 billion
Cuban was one of the first sports team owners to commit to paying hourly arena workers for games missed during the coronavirus crisis. He’s invested more than $20 million as a “shark” on ABC’s popular Shark Tank show.
11. Joshua Harris (Philadelphia 76ers): $3.7 billion
Harris cofounded private equity powerhouse Apollo Global Management in 1990 with fellow billionaires Leon Black and Marc Rowan. He remains a managing director there.
12. Gayle Benson (New Orleans Pelicans): $3.2 billion
Benson inherited the Pelicans and the NFL’s Saints when her husband, Tom, died in 2018.
13. Glen Taylor (Minnesota Timberwolves): $2.8 billion
His printing firm, Taylor Corp., generates more than $2 billion in revenue annually. Taylor also owns stakes in Minnesota’s MLS and WNBA teams.
14. Herb Simon (Indiana Pacers): $2.6 billion
The real estate mogul bought the Pacers with his since-deceased brother, Melvin, in 1983, for $10.5 million. Simon Property Group is one of the world’s largest real estate investment trusts, with 206 properties in the U.S.
15. Antony Ressler (Atlanta Hawks): $2.4 billion
Ressler cofounded private equity firm Ares Management in 1997. He owns a small piece of the Milwaukee Brewers, in addition to his controlling stake in the Hawks.
16. Michael Jordan (Charlotte Hornets): $2.1 billion
The NBA’s GOAT sold a minority stake in the Hornets in September in a deal that valued the team at $1.5 billion. Nike pays Jordan more than $100 million annuallybased on growing sales for the company’s Jordan Brand.
17. Marc Lasry (Milwaukee Bucks): $1.8 billion
Lasry, a hedge fund titan, joined Wes Edens to buy the Bucks in 2014 for $550 million. He was born in Morocco and moved to the U.S. at age 7 with his family.
18. Gail Miller (Utah Jazz): $1.7 billion
Miller transferred ownership of the Jazz in 2017 to a family legacy trust to deter her heirs from selling or moving the team. Gail and her since-deceased husband, Larry, bought the team for $22 million in 1986.
19. Jerry Reinsdorf (Chicago Bulls): $1.5 billion
Reinsdorf led a group of investors who bought a controlling stake in the Bulls for $9.2 million in 1985. Good timing. It was one year after the team drafted Michael Jordan, who led the Bulls to six NBA titles. The team is now worth $3.2 billion.
20. Theodore Leonsis (Washington Wizards): $1.4 billion
Leonsis initially built his fortune as a senior executive at AOL, before investing in sports teams like the Wizards and the NHL’s Capitals.
*Not included on the list but googled for your edification:
DeVos Family (Magic): $5.4 billion
James Dolan (Knicks): $2 billion
Joe Lacob (Warriors): $1.2 billion
Vivek Randive (Kings): $700 million
Robert Sarver (Suns): $400 million
Jody Allen (Trail Blazers): The sister of Microsoft cofounder, Paul G. Allen, took control of the team after his death. At the time her brother was worth $20 billion though he intended to give most of his fortune away...
Boston Basketball Partners LLC (Celtics): An American local private investment group formed to purchase the Boston Celtics
Maple Leaf Sports & Entertainment (Raptors): The Raptors are a subsidiary of MLSE
The Professional Basketball Club, LLC (Thunder): A group of OKC businessmen "who represent a wide variety of local and national business interests" owns the Thunder
Spurs Sports & Entertainment LLC (Spurs): An American sports & entertainment organization, based in San Antonio, Texas owns the San Antonio Spurs

Your 11-minute Tuesday report in 2562 words.

gas prices could rise due to currency fluctuations

Russian gas price (at the border) had increased from $150 to $165 per 1000m³ in 2019. Although the Russian currency Ruble was devaluing against the Dollar, Armenia was/is paying for gas with Dollars.
Since 2019, the Pashinyan administration has been trying to convince Russia to implement a different gas payment mechanism within the EAEU trade bloc. Making payments in Rubles instead of Dollars was one of the priorities:
"We are constantly talking about high dollarization within the EAEU, but we still pay for Russian gas in dollars. Our proposal was that it would be more correct if we paid for gas in rubles, because I think it is more logical, also within the EAEU," said Pashinyan in early 2020.
This idea was also shared by Vladimir Putin's personal adviser back in October 2018. It appears the EAEU has been working towards this goal lately.
But meanwhile, Armenia has to pay for Russian gas in Dollars. With Armenian Dram devaluing against the Dollar, the pricing for consumers will likely be revised. Consumers pay 139 Drams per cubic meter. This was calculated in 2020 when $1 was 480 Drams. Today $1 = 520 Drams.
Large consumers pay in Dollars and have their rates adjusted periodically, while small consumers (general public) pays in Drams.
Armenia imports 2.2 billion m³ gas from Russia annually, at the price of $165 per 1000m^3. 0.7 billion of it is consumed by the general public.
Dram was devalued by 6.6% since November. This could prompt the internal gas company to raise the prices, including for the general public.
https://armenpress.am/arm/news/1039886.html
http://www.armbanks.am/en/2020/04/07/128024/
https://neftegaz.ru/en/news/energy/406887-armenia-should-pay-for-russian-gas-in-rubles/

Public Council meets drone and robotics industry

The Public Council (linked to PM's office) held a meeting with engineers from the drone, robotics, AI, and nano-tech industries. They discussed ways to help the state to develop the military-industrial complex, drone production, aviation, and to bring their quality to international standards.
https://factor.am/327477.html

former PACE MP sentenced to 4 years for taking bribes from Azerbaijan

An Italian court has concluded that Italian PACE representative Luca Volonte, who is the former head of the European People's Party, took €2.4 million in bribes from the Aliyev regime in 2012-2013.
The bribe was handed over by Azerbaijan's PACE delegation leader Suleymanov. The scheme was coordinated by an Azeri lobbying firm based in Brussels. In return, the MP gave Azerbaijan favors during PACE and Italian Parliament sessions.
https://armenpress.am/arm/news/1039927.html
Tags: #caviar

POWs and searches

The search crews in Artsakh discovered bodies of 10 soldiers and 1 civilian in Jabrayil, Hadrut, and Sgnakh regions. The civilian has already been identified by his relatives. The cause of death is being investigated.
Many bodies under the possession of the Armenian side are yet to be identified, while more bodies will likely be found during daily searches for the foreseeable future. Overall, 575 calls have been made by families who are looking for missing relatives, says the Russian humanitarian envoy in Artsakh.
https://armenpress.am/arm/news/1039900.html , https://www.panarmenian.net/arm/news/289293/
Human Rights Ombudsman Tatoyan once again criticized Azerbaijan for intentionally politicizing and delaying the POW swap mission. "It is against international laws to file felony cases and arrest POWs because that's a form of a prohibited punishment. Azerbaijan is also hiding the true number of POWs."
The Ombudsman has noted that Armenian residents in Tegh, Vorotan, and several other bordering villages have lost access to 2500 hectares of farming lands due to border changes. (some lands that were internationally recognized as part of Azerbaijan were given to Azerbaijan after the war).
https://armenpress.am/arm/news/1039933.html , https://factor.am/327226.html , https://www.armtimes.com/hy/article/204175

POW discussions: general prosecutor meets Azeri counterpart

Chief prosecutor Arthur Davtyan and his Azeri counterpart were invited to Russia. The three sides held a conversation about the establishment of future contacts in the field of international law and other related topics. Prosecutor Davtyan mentioned the importance of implementing the November 9th statement about the return of POWs, "which will serve as an assurance for implementation of other [trade unblocking] issues."
https://armenpress.am/arm/news/1039953.html , https://armenpress.am/arm/news/1039972.html

how much will a new railway network cost?

Azeri economists believe it will cost around $430 million to build a railway network connecting Kars(TR)-Nakhijevan(AZ)-Meghri(AM)-Zangelan(AZ)-Baku(AZ). Overall, if you add Gyumri between Kars and Nakhijevan, it could cost about $434 million.
Economists believe Armenia can use this network to connect with Russia via two directions: Gyumri-Nakhijevan-Meghri-Baku (southern trip), or Ijevan-Ghazakh-Baku (northern trip).
https://www.panarmenian.net/arm/news/289313/

rumors & rebuttals: traitors are not selling Azeri juice in Armenia

Telegram channel Mediaport circulated rumors that "Azeri Sandora juice is being sold in Armenia". The misinformation was picked up by several outlets and caused confusion among the buyers.
Fact-checkers contacted Sandora's local importer who said the producer is a Ukrainian company that sells its product in multiple post-Soviet republics, so they have one unified tag that contains information both in Armenian and Azeri languages.
https://fip.am/14469

4 Dutch MPs receive medals for friendship

Among them is ethnic Kurdish MP Sadet Karabulutu, who publicly criticized the Turkish-Azeri aggression during the war.
https://www.armtimes.com/hy/article/204216

food prices in Artsakh

Pricing for 43 commonly-consumed items was examined by the consumer protection agency in Artsakh. 12 became more expensive, 5 cheaper, 26 remained the same.
Onion +25%, cottege cheese +6%, milk +6%, gloves +5%, ..., pear -12%, rice -1%, eggs -1%, butter -1%.
Several dairy product prices went up, and since Artsakh has dairy companies that own dominant market share, the consumer agency will launch an investigation to see if there was price-fixing.
https://armenpress.am/arm/news/1039946.html

seismic resistance assessment for old buildings

A significant portion of Armenia's large apartment complex buildings were built half a century ago. They may not be seismically safe, considering Armenia's geolocation. After the 1988 earthquake, some buildings remain populated despite being deemed highly unsafe. Many other buildings have safety irregularities.
It is necessary to assess the situation, so the Urban Development Committee has drafted a bill "Methodology for assessing the priority of increasing the seismic resistance of buildings and structures".
https://armenpress.am/arm/news/1039887.html

IRS will closely monitor gambling industry / RFID chips & servers

IRS press release: gambling facilities and online betting services will be more closely monitored. We worked with international experts to digitize the gambling industry and bring it on par with international standards.
All gambling machines and platforms operating in Armenia will be connected to one server which will be connected to a monitoring Center. All betting and winning transactions will be recorded.
The Center will also install RFID microchips in casinos to monitor the movement of chips, the chips purchased or won by players, in real-time.
The government's Digital Council has approved the bill, which is yet to be discussed and voted in the Parliament. The goal is to be able to monitor the financial flows in this sector and to estimate the actual revenues. It will combat money laundering. (BHK skipping a Parliament session due to "COVID" in 3, 2, 1, ... /joke)
https://armenpress.am/arm/news/1039915.html

new "public council" will advise Nature Ministry

Nature Minister Romanos met several environmental organizations and environmentalists and discussed the creation of a new Council, which will advise him on nature protection issues, help draft bills and roadmaps, work with other environmental organizations and NGOs. The Council is accepting applications.
https://armenpress.am/arm/news/1039896.html

large quantities of illegally-cut trees were busted

... by Ijevan policemen during a routine patrol on Sunday. Three cargo trucks were filled with wood.
https://armenpress.am/arm/news/1039960.html

rammed through the gates

The police have arrested the father of a missing soldier who used his Vaz 21 vehicle to ram through the Defense Ministry's entrance gate before smashing it into a building on Sunday.
https://armenpress.am/arm/news/1039957.html , https://www.panarmenian.net/arm/news/289315/

"turn off the camera"

Context: An incident happened last week between parents of drafted soldiers and military officials at a military unit. The parents wanted assurances that their sons would be safe after being deployed on Artsakh borders. The parents wanted to know why Armenian soldiers are still being sent to Artsakh "despite the November 9th statement saying Armenians should withdraw from Artsakh."
During the confrontation, an incident happened between a military official and a journalist. The official struck the camera and instructed it to be turned off. Several media outlets released a message condemning the officer for hindering the journalist's work.
https://armenpress.am/arm/news/1039973.html

infrastructure upgrades

Four settlements in Kotayk province (Yeghvard, Nor Gegh, Aragel, Zovuni) have a newly renovated irrigation pipeline as part of a govt subsidy program.
https://www.armtimes.com/hy/article/204202

today in history

1932: First Yerevan tramway began operating in Yerevan
1951: The UN Convention on the Prevention and Punishment of the Crime of Genocide was implemented.
https://armenpress.am/arm/news/1039885.html

get your free colonoscopy today

The National Center for Oncology has purchased the latest generation tools and will perform a free and enjoyable colonoscopy for residents over the age of 45, for the next 6 months.
The goal is to detect suspicious growths at an early stage. It's the third most common cancer among adults in the world. It has become more common in Armenia in the past decade. When detected early, it can be fully treated.
https://armenpress.am/arm/news/1039911.html

COVID stats

+1885 tested. +355 infected. +729 healed. +5 deaths. 8393 active.
The death rate has been 1.8%. The infection reproduction rate was 0.84 in the past two weeks, down from 1.43.
https://armenpress.am/arm/news/1039906.html , https://armenpress.am/arm/news/1039943.html

COVID numbers have declined, so what do we do?

... we lift some of the restrictions!
"Aye, aye, Captain!"
"I can't hear you!"
"The rule that limits attendance to non-commercial gatherings to no more than 60 people has been removed. All other safety requirements remain in place," said a Healthcare official. "You can enter Armenia via air or land by presenting negative COVID test results that were taken within the past 3 days. If you don't, you will be tested at the airport and will need to self-isolate until the results arrive."
https://armenpress.am/arm/news/1039931.html

Armenia will soon import COVID vaccines

Healthcare Ministry: we are negotiating with multiple entities. The first batch of vaccines will arrive between late-January and mid-February. We are negotiating with producers whose vaccines have passed the necessary tests: Sputnik V, Pfizer, Moderna, and AstraZeneca. In the first phase, the vaccines will be given to the most vulnerable 10% of the population.
https://armenpress.am/arm/news/1039921.html

Sputnik V vaccine has already been tested in Armenia

Healthcare Ministry: no complications were reported by the 15 patients, including Minister Torosyan. The often-discussed "skin redness" in the injection area has not been observed, either.
The first injection gave a 91.4% efficiency. The second increased it to 94%. Even if the vaccine doesn't fully prevent the infection, it can save the patient's life by making the case mild (is that right??).
https://armenpress.am/arm/news/1039925.html

the new COVID strain: good news, bad news

Doctor Davit Melik-Nubaryan: the version of COVID that mutated in the UK will eventually reach Armenia. Preliminary data shows that those who have already been infected and gained immunity from the original COVID will be immune to this new strain. It is believed that the immunity will last 6-12 months for the majority.
The good news is that the new strain isn't more deadly and doesn't result in heavier cases. The bad news is that it spreads a lot faster. The Healthcare system could be overloaded again.
The vaccines against the original strain will likely work against the new one. Pharmaceutical companies may have to modify the vaccines, but it will only take weeks.
Closing borders with the UK won't be helpful to prevent it. We may already have the new strain. We need to develop a new strategy from the ground up.
Viruses mutate all the time. It's part of the evolution. Sometimes they cause more severe symptoms, sometimes lesser. From the evolutionary and survival standpoint, viruses want to cause less severe symptoms for the host so they can have a chance to spread wider.
https://armenpress.am/arm/news/1039856.html

Armenian scientists will study the COVID strain

CDC chief Bakunts: Armenia will have the ability to study the genetic mutations of the coronavirus. Active work is underway to invest in research resources. Meanwhile, we can submit a virus sample to a WHO laboratory to conduct a study for us.
https://armenpress.am/arm/news/1039962.html

families with newborn children receive mortgage subsidy

450 families have so far taken advantage of a government subsidy program that helps with purchasing apartments. ֏526 million will be paid as part of this 2020-2023 program. It is part of a recent initiative to boost the birthrate.
Two other aid programs went into effect in mid-2020. Provincial families received a downpayment subsidy equalling 5% of the total price. Another one subsidizes insurance payments.
The same family can apply for all three programs, and there is no age limit for parents.
https://factor.am/327385.html

diaspora-government cooperation expands: iGorts

iGorts is a program that recently recruited 48 highly skilled diasporan Armenians to visit Armenia and work at 19 various government agencies. Three more volunteers have arrived today to begin their work: Shila Palyan from Canada, Zaven Ayvazyan from Russia, and Anahit Mikaelyan from Cyprus.
https://www.armtimes.com/hy/article/204211

Yerevan to install 32 more elevators in apartment complexes

Arabkir district is the next recipient. Hundreds of units were installed in 2020. They replace the decades-old elevators that have become dangerous and poopy. The new elevators come equipped with running water and flush so you can drain your crap /s.
https://armenpress.am/arm/news/1039954.html

have you been buying stuff right and left lately?

...because trade turnover increased by +34%, and the number of printed receipts by +7%, during this year's New Year's holidays.
֏91 billion was spent between December 29-31, which is ֏23 billion more.
https://www.armtimes.com/hy/article/204195

would your majesty be pleased to take a salt bath?

Nerqin Getashen will have a halotherapy "salt bath" center to help alleviate certain conditions. It's the first in Gegharquniq province. There will also be rooms for aromatherapy (oils), ogyxenotherapy (oxygen cocktails), and massage.
The owner claims it helps boost immunity and alleviates breathing, allergy, and insomnia issues (take the claim with a bath of salt).
https://armenpress.am/arm/news/1039974.html

first Yezidi theater to open in Armenia

"шəp' y əBин" or "war and love" will be the first performance in a newly opened Yezidi theater in Ejmiatsin. It's part of a «Եզդիների կողքին» cultural initiative. The crew had planned a major performance about Yezidi national legend but the 44-day war began and some were drafted.
The crew ended up performing the "шəp' y əBин" during the war. It's about the importance of Yezidis in Armenia, and their love for the country. The January 17th performance will be dedicated to Yezidis who died fighting.
The performers aren't professional actors but they received acting training on-the-fly. "It seems to work because their enthusiasm is great. A very good team has been formed," said the producer.
https://armenpress.am/arm/news/1039941.html

Aram Khachaturian House-Museum will resume "Musical Thursdays"

This year's first classical concert is dedicated to Ruben Babayan, "the BFF of Armenian musicians."
https://armenpress.am/arm/news/1039916.html

Netherlands college will donate large quantities of school supplies

Several thousands of desks, chairs, furniture pieces, computers, lockers, etc. are being loaded in containers to be shipped to Armenia.
The Hermann Wesselink college is renovating its building with new items so they decided to donate the old stuff to Armenian kids. This will be enough to equip 15 provincial schools.
https://factor.am/327135.html

donations to Artsakh & recovering soldiers

www.1000plus.am (recovering soldiers & their families)
www.HimnaDram.org (for Artsakh & Armenia)
www.ArmeniaFund.org (U.S. tax-deductible)

archive of older posts

Armeniapedia's archive of my daily news threads:
http://www.armeniapedia.org/wiki/Daily_Anti-Corruption_Reports

disclaimer

All the accused are considered innocent unless proven guilty in the court of law, even if they "sound" or "appear" guilty.

Hey team, I'm currently trying to put together an investment thesis about ChainLink and I'm trying to:

1. Really understand the value of the LINK token
2. Verify all of my assumptions
3. Have anyone/everyone poke holes in my thesis

Can you help point out where I might be mistaken or verify the assumptions with links to articles/tweets/etc that might act as a good source?
I'm really trying to understand *IF* there is true value and price appreciation in the token. Most of the articles I find online are all price speculation with no backing of *WHY* the price should go up (e.g. big woop if the market cap for BTC goes up. That doesn't actually mean that the marketcap or value of the LINK token will also go up. THAT'S A STUPID THESIS AND YOU MIGHT AS WELL GO TO THE CASINO!
/rant over. Comments & constructive thoughts appreciated. Trolls too. I like trolls.
---------------
Chainlink (LINK) - As smart contracts become more mainstream, they will need oracles to provide inputs from the outside world to execute their contracts. Anything from using the weather (like issuing insurance to farmers for a bad crop year), sport outcomes (like sports betting), obituary information (transferring assets upon death), etc. will all use ‘oracles’ to provide that information. ChainLink works by allowing multiple third parties to provide that information through the chainlink network. Chainlink will require information providers to put up collateral (in LINK equal or greater to the amount at stake in the original smart contract) to compensate users if they provide wrong information.
E.g. If I use an ethereum smart contract (or other blockhains such as polkadot), to pay Steven $20 if it rains tomorrow @ noon in Denver, CO, then I’d likely put ~$22 into this smart contract ($20 for the bet, $1 for ‘gas’, and $1 paid in LINK to the info provider (the % of contract or actual numbers don't matter here for this example). In that instance, an oracle or information provider would stake $20 (or more) in LINK as collateral and provide the relative information. The oracle would lose their $20 in LINK if the other X providers of the same information don't agree, so there’s an incentive to provide the right info). For providing the right information, the info providers split the $1 F\fee). Because there is a limited supply of LINK, and as smart contracts use more oracles over time, the value of the remaining link that are unstaked go up as there is a fixed supply (but don’t forget the staked LINK goes back into the main pool for more smart contracts as historical smart contracts finish executing - i.e. the LINK required to stake the bet with Steven goes back into the pool after tomorrow).
Said in another way, if I want to sell my data, I need to be more trustworthy than other data providers and thus need to stake more LINK tokens, so I buy more LINK and stake them. This both increases the demand because of my purchase and reduces the supply because what I stake is removed from circulation. Others now need to buy more LINK to stay competitive with me, further increasing demand and reducing supply.
There’s also a ton of value offered to the enterprise data providers. Having any enterprise be able to sell their data to anyone using smart contracts, allows them to generate more revenue while providing more data for smart contracts to use. I.e. there’s an incentive for non-decentralized companies to provide info to the decentralized network over time.
The network becomes more attractive to smart contract creators/users due to the larger amount of data available on it, this causes more users to join, which then causes more data providers to join in order to sell to the increased number of users and so on and so forth.
For those reasons, I think the value of the LINK token will exponentially grow over time.
​

• Risks:
  • You currently cannot stake your LINK as collateral. It’s part of the roadmap - so there’s execution risk here.
    • I *think* this is the largest risk to this currency.
  • It’s unclear to me whether you’ll be able to stake LINK if you’re not an information provider (i.e. I’m not going to run a node or provide this information, I just want to stake my LINK as collateral).
    • I *think* worst case this means that I won’t earn LINK rewards because I’m not an info provider, but I should still benefit from the value of LINK increasing.
  • I don’t see any network effects here blocking other protocols from providing the same information. E.g. I could see ethereum or polkadot choosing another ‘oracle’ protocol other than ChainLink to get decentralized information from the real world
    • I think this lowers the ultimate value of LINK but if this is the only real concern, then I still think it’s worth owning - LINK would still be used, in addition to whatever other platforms come out. E.g. Both Pepsi & Coke co-exist (ok bad comparison, but you get the idea)

​

• Questions:
  • Are there any other ways I'm not accounting for that make LINK more valuable?
  • Anything I'm missing that could make LINK less valuable?

​

• Research:
  • Here is an incredible description of how chainlink works and why it is valuable.
  • Here are projects similar to chain link
  • Here is how chainlink is used.
  • Here are 77 use cases for how this token will be used in the future.
  • Here is the dashboard where once staking LINK becomes possible, this is where it will be done.
  • Here is another amazing visual breakdown of how Chainlink works.
  • Competitors include NEST.
  • Here is linkpools whitepaper.

Hi,
I just want to give an introduction and see what people do and how they go about recruiting etc within the game.
I want to make a community discord for my Torn gang, I am also considering joining one that I already got an offer for. Protection and a nice allay aren't too bad. Even tho I am waiting to build myself up more and set myself up for a few things (Education, gym, etc)
I am currently a casino worker, So that comes a long way for now, and I am currently betting all my money on long term bets and investments Until I can use it to settle for better.
I want to own a business at some point but I am not sure how that works, so any information about that, if that generates revenue at all times, or if you need other player workers to make revenue from the business. My long term goal is that I really want to own an Oil rig and hopefully other businesses along with it if that's possible. Also, I hope that the businesses work in a sort of way where customers get in at random either AI and work sort of similar to the public ones. Essentially I am really curious about what work that required to keep the business running and keep making profits (Like A tutorial or introduction).
I also want to create discord where I have a chat for the companies - And general "clan" chats for the torn community I plan to create. Right now my education is actually surrounded towards being a lawyer because of the pay it gives early on, But I also liked the idea of being a criminal lawyer. Now I start to realize I need to put some effort into getting educated within fitness and defense etc, based on various reasons that would be beneficial when doing crime.
Also, What is your daily routine when jumping into the game? I find that I don't seem to do that much other than just working towards the stats, find ways to spend money to make money (Betting), and after 15 ish minutes maybe 30, I am all empty of stuff to do and have to wait. I also haven't logged on in a while last time because I had to wait for the education to finish. So I have lost quite some days I could have used to maximize stat training efficiency.
I forgot to say, I am looking to make the community very special when it comes to invitations, to begin with, and I want to make a stable rank system for it as well to ensure we have good and skilled players but also a newbie training program for new players that joins the community. I am a newbie myself In torn (I might have an old account from years ago) But I am by no means a newbie to the RPG World and the Text-based as I have done several RPG things before and done really well at that. - I also want to use the discord community and the torn community that I want to create and allay up with other torn gang communities or other types of torn communities.
Anyways, Thoughts? I am really excited to build my character and to start to build this discord community (When My character gets buffed up and leveled up more) and build a gang of solid ruthless people on torn.
Thanks, hope everyone has a wonderful adventure and a wonderful day onwards.

So I had an idea the other day and the more I think about it the more i want it implemented into the game because I feel like X4 is lacking this.
So I love to roleplay. I love to imagine myself being this Split who survived and built up a trading empire and eventually managed to built up a large military force to reclaim the split sectors and free them of the ZYA.
You can really feel like a fleet commander in the game. You stand on top of your giant carrier, with lots of ships docked, escorts all around you. Yeah it makes you feel pretty good.
But what about those who run trade empires? Sure we can stand on our stations, and the feeling of standing on your first, own station is amazing but you don't really feel like the rich CEO you are.
All of the modules we have in the game are functional, none are purely cosmetic. I get that, cosmetics aren't as important as functional items when resources are scarce but I'd really love to have my own office. Start with a functional looking office but eventually be able to build luxurious offices with wood.That could tie in into terraforming. From what we've heard so far Terraforming won't provide any economic benefits but that would be the perfect opportunity to introduce wood and other luxury goods into the economy, population too. One or two civillian ships would be cool too, like an expensive yacht type ship or racing type ship.
​
This ties into the other idea: Passenger missions.These would require a new ship class however, or several rather. The idea I had was along these lines:
Regular Passenger missions: Regular, low to mid quality passenger ships. Transport them from A to B, low risk. Transport people between planets and stations.
Military transport missions: These could be retrofitted freighters for passengers with turrets. They are higher risk since you transport military personnel and thus might be attacked by rival factions. These could include transporting military personnel between stations and planets or for higher risk and reward transporting them to carriers on the frontlines. Your ships would have turrets and you might use an escort.
Luxury transport missions: I'll be honest: I love luxury space ships. These might require a lot of work, we haven't seen anything like these in X before I think. The idea is that you ferry around high profile targets, rich businesspeople, politicians and so on. Have sight seeing missions or something. Bring an escort, you likely will be attacked.These passengers have high standards, get unhappy when the ship takes damage or when you take too long. The ships would look luxurious, be it a small 'yacht' or a large luxury freighter. Man it would be awesome if we could walk around these ships even.These ships might look like the imperial ships or the Dolphin, Beluga or Orca from Elite Dangerous, or like the 890 Jump from Star Citizien (If you want to go overboard, that ship is absolutely gorgeous however).Imagine Boron looking ships like that, ahh, heaven.
​
Anyway, I am aware that this idea would require a lot of work since it would require the development of new ships, new mechanics and so on. It's just an idea. Maybe Bernd likes some ideas of it and wants to implement some parts of this in the future (: Man I hope we get some cosmetics or at least an office in the future! Give us luxury!
​
I have so many more ideas that could build onto this, casinos, leisure modules, hotels. Don't restrict yourself to trading and war, build a tourism empire!Again, these are just ideas. Maybe we get a DLC like this in the future after all the major missing races have gotten their own DLC, who knows what the future holds.
​
Edit:
Let's look at an example that could show how current and future features could interact with passenger transport. I'm going to touch on other ideas but they'll play into each other. These are long term ideas, as in several expansions down the line. This is how I think passenger transports could add a lot to the game but they would require other features to play into it. Passenger transport all by itself is boring, you're transporting yet another commodity at that point.
1: Populations consume luxury goods. One of the main problems we have is that the only economoy we have is an economy of war. Once the wars stall or the universe gets into a peaceful state the eceonomy will lock up. If we had an ever growing population that keeps consuming more and more luxury goods however the player would have an ongoing incentive to keep building stations, this could keep the economy going.
2: Low population happiness causes an increase in crime. High unemployment, high taxes, low supply of luxury goods, lack of access to leisure. All these things could make the population in a sector more unhappy, this could result in increased black market activity, increased pirate activity and so on.
3: Let's say Argon Sector 01 has too much unemployment, while HAT Sector 01 has too much unemployment. You could transport pops from ARG Sector 01 to HAT Sector 01. HAT Sector 01 would get a boosted economy, ARG Sector 01 has happier population and increased tax revenue and you earn money.
4: Planets steadily produce more population. This population needs to be suppplied with luxury goods and employment. This would incentivize the player to expand at a steady pace, build more stations and expand their passenger transport lines.
5: Terraforming will be a resource sink, add populations to that. Terraforming requires a lot of man power, unless they use machines. But even then those newly terraformed planets require workers. Ship them there. Lots of profits.
6: Transfer high profile persons of interest (be it political or economical) from point A to point B. You'd use luxury cruiseliners and similar for this. Maybe even space-yachts. These targets might get attacked by enemy factions. For example you might have to transport an amabassador to your capital station (your office) to sign a peace treaty. Enemy factions might attack your ship in an attempt to make you look incompetent and blow off that treaty.
7: Transfer military personnel to unhappy / unstable sectors or frontier sectors. Military personnel keeps order and is required for war. Transport them around in armed military transports.
8: Leisure modules. Cosmetic modules and leisure modules such as hotels, spas, casinos could serve to increase population happiness. Some of these modules can not be built on stations that have production modules (Like luxury hotels for example). These modules consume luxury goods as well. These leisure stations can not be placed in a certain radius of production stations maybe. They would increase population happiness and act as tourist magnets, generating extra income.

Disclaimer: I am a trainee chartered accountant who works in large tax firm. My specialty is a very specific area of corporation tax; I do not prepare tax returns in my job, and I don't work with personal tax. I live and work in the European Union, but the tax issues are high-level principles, and in general I think the conclusions aren't really affected by the specificities of the US tax code. Nothing in this post should be taken as tax or legal advice in any context.
I wanted to try and put down some thoughts on the Trump tax return revelations in order to achieve some kind of catharsis in the face of what I think is a lot of misinformation and misunderstandings. I'll include headings for each issue on my mind and hopefully people can either gain some insight or engage with me to help me to understand better.
Tax Planning, Avoidance and Evasion
First, let me explain with examples what each of these terms refer to.
Tax Planning is the use of tax incentives to minimize a tax bill which are contemplated by the drafter of the tax code. An example is a scheme that would allow you to pay your gym membership using your pre-tax pay: when you pay the sum out of the gross amount, you won't suffer tax on the amount paid, and as such you will pay less tax. The idea is that by incentivising the population to spend on a certain outcome, the benefits of the outcome (healthier people) will be more efficient for the system as a whole (healthcare or mental health or whatever).¹
Tax Avoidance is the implementation of aggressive or inventive tax structures in order to reduce a tax bill in a manner which is either legal or illegal, characterised by the lack of contemplation on the part of the drafter of the tax code. In other words, it means you are finding a "tax loophole" that doesn't necessarily generate value otherwise for the state and taking advantage of it to reduce your tax bill. A famous example of this is the "Dutch Sandwich": large corporations took advantage of the relationship between different international treaties in order to shift profits to a low tax jurisdiction such as Bermuda.²
Tax Evasion is illegal tax avoidance. Let's say you rent a property and ask your tenant to pay you in cash. You then do not declare this cash as rental income, thus avoiding having to pay tax on your rental income. This is illegal because you haven't presented a fair and true set of information of your taxable income/expenses for the tax year, so you are evading the payment of tax. You could, for example, claim a tax refund to which you are not entitled.³
With regard to Trump, tax avoidance alone with respect to his personal affairs should constitute a black mark on his record as a public servant. It ought to be a huge scandal that a politician avoided tax, no matter how elusive and clever the scheme, because tax avoidance results in a deficit in the year's tax revenues that has to be made up for by the taxes paid by the public. If even a comedian has enough shame to apologise and roll back his tax avoidance arrangements, a presidential candidate should do it in a heartbeat.⁴
Carry-forward Losses
Carry-forward losses are a technically complicated area of taxation, and I am not at all privy to the rules in the US. This doesn't matter though, because in principle the implementation is extremely understable. It means that when you have a business venture, and you make a loss in a given year, you can use that loss in future years to avoid paying tax on the profits. Let's take a super short example:
Let's say I have income in Year 1 of 100 and expenses of 120, so I make a loss of 20. I don't pay tax on my loss. Let's say I have income in Year 2 of 100 and expenses of 80, so I make a profit of 20. The previous year's loss cancels out my profit this year, and I don't pay any tax.
The result is that you consider the entire business venture in its entirety, because it would be unfair (and unproductive) to force a business to suffer tax on its profitable years but to ignore the years it made a loss.
For me, carry-forward losses do not come close to avoiding a tax burden for 11 of 18 years, as per the NYT article. Perhaps the layout of his taxes paid is bizarre (he could have had a huge tax bill in a single year which means the lack of tax paid in the other years is explained). The reason that this is telling is in the opening paragraphs of the NYT article:⁵

He had paid no income taxes at all in 10 of the previous 15 years — largely because he reported losing much more money than he made.

"Largely because he reported losing much more money than he made."
This is the idea you have to grip in your head: if Trump were an investment machine, you would put a dollar in and get back 30 cents. These facts outline the financial profile of a business operative whose extreme incompetence and lack of self control has resulted in losses for the shareholders of the businesses for which he is responsible. A capable member of management has literally one job: make money for the company's shareholders, and it is clear that in the aggregate Trump has not been able to succeed in doing this.
The article outlines further that the only area in which Trump was successful was in his capacity as a performer in the context of shows like The Apprentice⁶ or ads for Oreos⁷ or Domino's pizza.⁸ His only successful venture is playing the part of a caricature of the businessman he pretends to be in his professional life, whereas in reality he was a total failure. Trump's only successful business investments are companies in which he did not perform a management role: those where he invested capital and the business was ran by someone else.
Quick Fire TL:DR Round

• The bulky tax refund that Trump used to reduce the majority of his tax bill is the subject of an audit by the IRS. I don't know anything about this audit, and you don't either.
  
• Trump has personally guaranteed loans (I have never encountered this and it is an immensely foolish thing to do in any business context).
  
• Trump has large amounts of concerning debt, the principal (the amount he originally borrowed and has to pay back) is coming due in his second term.
  
• Trump has deducted questionable expenses against his taxable income (either for avoidance or embarrassment reasons), such as certain residences, aircraft and the $70,000 in hair styling.
  
• Something really interesting: the Trump Organisation has paid Ivanka Trump as a consultant in a manner which reduced the family's overall tax bill. This is a red flag for auditors, as the sum paid could be engineered to reduce their taxable income as the parties involved in the transaction are related.
  

Last thing: "Maximise Present Value of Cash Flows"
Here's a comment that frustrated me immensely, but it's posted in an echo chamber so I couldn't reply: https://old.reddit.com/Conservative/comments/j106fp/ny_times_trump_paid_750_in_us_income_taxes_in/g6wv06i/
The argument is that the losses are sustained in order to maximise present value of cash flows:⁹

Not even close. Again, Amazon was a company with negative net income and worth hundreds of billions of dollars. Is that also a failed business? Amazon and Trump seem to be employing the same strategy - using their free cash flow to maximize future earning potential. All Trump's tax returns tell us is that he is trying to "maximize present value of future cash flows" - exactly what Amazon does.

This is intensely misleading and doesn't take into account the stark differences between Trump's area of operations and Amazon. Moreover, the correct comparison isn't the entity Amazon, it's Bezos, and the taxes he paid as the leader of a large & successful conglomerate over the course of 11 years or so.
In certain industries, it's common to sustain heavy losses in early operational years in order to prepare for years when you expect your business venture to generate revenues. Take a pharmaceutical company: during the years when you are researching and developing your drug, you can't sell it, so you make losses on that specific venture: but when you finally start to actually get people paying for your product, you can often command a price high enough to recuperate whatever losses you made. In the case of Amazon, Jeff Bezos devoted the company's strategy to building a robust and near-monopolistic infrastructure where Amazon inhabits so many areas of consumers' lives that they turn to it without thinking for everyday products, subscriptions etc.
The question I would love to grill this commenter on is super simple: when your businesses are casinos, golf courses and hotels, what exactly is the event or change you are expecting to take place in the future that will suddenly "maximise your future cash flows"? What is the future investment that Trump's ventures are sustaining net losses on that are going to be profitable in the future? Why are Trump's competitors in these sectors generally able to run their businesses with enough alacrity to generate a profit?
If Trump were an able businessman, there is no reason he shouldn't be able to run these businesses successfully.
Questions
If anybody is curious about anything above and wants to discuss it, or just ask me to explain/give my impressions on any of this stuff, feel free to ask and if I think I understand it it would be fun to discuss.
For anyone who understands the US tax system better than I do: one issue I can't wrap my head around at all is how people keep talking about "depreciation" in the context of these revelations. If you think you understand it, can you explain to me how Trump or others think depreciation has anything to do with the information revealed in the NYT article? Depreciation, as a rule, shouldn't affect taxable income because it's an accounting entry and not a deductible/relevant tax expense.
¹ https://www.unionen.se/rad-och-stod/friskvardsbidrag-fran-arbetsgivaren, for example.
² https://en.wikipedia.org/wiki/Dutch_Sandwich.
³ https://en.wikipedia.org/wiki/Wesley_Snipes#Income_tax_conviction.
⁴ https://en.wikipedia.org/wiki/Jimmy_Carr#2012_tax_avoidance_controversy.
⁵ https://www.nytimes.com/interactive/2020/09/27/us/donald-trump-taxes.html.
⁶ https://www.theguardian.com/us-news/2020/sep/29/trump-tax-returns-the-apprentice-empire.
⁷ https://www.youtube.com/watch?v=YIRtruagdPc.
⁸ https://www.youtube.com/watch?v=ouG9cVhjPds; https://www.youtube.com/watch?v=lEROWjPdCNU.
⁹ The use of this phrase in this context is total nonsense. "Net present value" is an investment evaluation technique that takes into account the time value of money for future investment flows. What the commenter means, I think, is effective working capital management: based on the facts in the article, Trump is an atrocious working capital steward as the losses he sustains through his businesses will have to be supplemented with additional capital in the business, either from his own pocket or shareholders he can convince to invest.

A few days ago, I saw a couple of posts on creating fourth paths for various towers. It got me thinking what other tower's fourth paths would be like. The Banana Farm's upgrade paths focus on increasing its current efficiently (top), generating revenue overtime with some micro involved (middle), and removing microing altogether (bottom). A factory, a bank, and a marketplace. What's another place that would produce cash? A casino!
So the idea of this path is gambling. It has the potential of being the best or worst path for the Banana Farm. Upgrades being cheap are also part of the gamble. Play it safe and get guarantee money though quite a bit later, or take a risk and get some crazy early cash. So, here are my ideas:
(Cost is for the medium difficulty).
Tier 1:
Name: Coin Flip
Cost: 100
Description: Either generates an extra banana that round or produces one less banana that round.
Effect: 50% per each effect.
Tier 2:
Name: Dice Roll
Cost: 300
Description: Each banana has a chance of doubling its value or halving it.
Effect: 1/6 chance to double or halve each banana's value. 4/6 chance the banana will generate the normal value.
Tier 3:
Name: Monkey Casino
Cost: 1500
Description: Generates between 100-1000 at the end of each round. Gamble away lives to increase chances of winning big!
Effect: Can gamble away to 50 lives to increase chances of winning. No longer generates money throughout the round. Cash generated really starts at 100-300 but maximum cash generated increases with every live gambled away.
Tier 4:
Name: Lucky 7
Cost: 7777
Description: Generates between 300-7000 cash at the end of the round.
Effect: Can gamble away up to 100 lives for chances at high payout. Gambling 100 lives guarantees 2000 cash payout at least. Cash generated really starts at 300-777 but maximum cash generated increases with every live gambled away.
Tier 5:
Name: Two sided coin flip.
Cost: 42500
Description: Generates between 1000-20000 each round!
Effect: Can gamble away up to 200 lives. Gambling 200 lives guarantees max payout. Cash generated really starts at 1000-3000 but maximum cash generated increases with every live gambled away.
Crosspaths:
Path 1: Increases max cash the casino can generate.
Path 2: Increases chances of winning big.
Path 3: Decreases amount of lives needed to win big.
So what are your thoughts on this? I'm not sure how exactly the RNG should work of Tier 3 on wards, but I hope I described it well enough that it makes sense.
Edit: I should also mention that while gambling away increases chances, unless otherwise stated, you still have a chance of winning the minimum amount of cash. Gambling lives increases chances, it does not guarantee them.

Norway’s Unemployment jumps 128% in only one week, making the unemployment rate in this country highest since 1995. The spread of the coronavirus have brought the richest Nordic economy to a near standstill. That alone can give us somewhat of an idea how the rest of Europe is struggling, on top of the major debts they're sitting on at the moment. Don't wanna be a neg, but we are probably just at the tip of a domino fall that this black swan has brought us, and once shit hits the fan, things are going south. Real south.
I don't think a lot of us have yet to understand the full devastation that the novel virus plus the wildly hyper-elated economic period in the past few years are going to have on our daily life. Fed is on full on panic mode, and our interest rate is at 0%, yet there's virtually no way in calming the market. Casinos, hotels and airlines are begging to be bailed out, trillions of government debt, etc. Most businesses who have been living paycheck by paycheck, are in danger with the amounting cash problems, huge costs, while generating virtually no revenues. On top of that, there is a looming liquidity trap
Yeah. not even taking into account the general public health yet.
When economic data is out, and everything points to a recession, boomers who have been in delusion, watching CNBC and reading Wall Street Journals for breakfast are going to really realize what the fuck is going on, and freak the fuck out, and will keep all the cash in their 401k. Take a look at the economic numbers of China, first time ever since Mao that the economy is in contraction. And they're on the hyper-dictator level of lockout to control the virus. We are like, the kid-friendly version Fed is going to panic more but can't do shit about it, many many many people are going to lose their jobs, including us austists. But good thing we can be full time autists.
​
TLDR; we're fucked. SPY 200p 05/15. Again, I'm not an economist, I'm a fucking gambler, this is just my two cents. I have no idea wtf I'm talking about but I'm betting on it.
Good luck, class of 2020.

The following two paragraphs are from this Wannabe Billionaire: Arun Pudur's Tech Fortune May Be Largely Fiction:

From a Kuala Lumpur office, 38-year-old Arun Pudur is building an international business empire, or so he says. The flagship of his Pudur Corp., he says, competes with Microsoft, Adobe, Symantec and other technology giants with copycat products that he promotes as cheaper, faster and less prone to viruses. Its biggest seller is a knockoff of Microsoft Office that he says boasts 25.6 million users, including U.S. multinationals such as General Electric, Krispy Kreme, MTV and Boeing.
After software there's mining. Pudur says he bought a gold mine in South Africa in January and that he aims to become the world's third-largest platinum producer in five years.
Five years ago, he says, he began trading liquefied natural gas in East Asia. He says he and a partner are developing a beach resort, casino and water theme park in Malawi.
He says he's invested $10.2 million in Genesis Telecom, which he describes as an underwater-cable operator that will supply 30% of all Internet service to Indonesia.
All in all, Pudur Corp. claims it operates in 20 industries and 70 countries--generating $13.4 billion in revenue last year and reaping $3.6 billion in net profits.
Bloomberg had him speak in December at its ASEAN Business Summit in Bangkok. The topic: Entrepreneurship: Turning Ideas Into Global Success Stories. Earlier, Twitter included him in an e-book it published titled "Tweets From the Top," amid a collection from Asia-Pacific leaders, including South Korea President Park Geun-hye, India Prime Minister Narendra Modi and Mahindra Group Chairman Anand Mahindra.
Pudur certainly likes to call himself a billionaire, and he agrees with Wealth-X that he's worth $4 billion. As one of Pudur's tweets, hashtagged #lifelessons, says: "People buy you, your stories, your magic, never your products or services."

Now, all this looks very promising (Not!). We have got another person who will follow in the prestigious, honest and hardworking footsteps of Ambani and Adani (/s). However, there are some vital things missing....

However, Pudur's business empire--and his billions--may be largely fiction. FORBES ASIA e-mailed 25 people on a list supplied by Pudur Corp. of customers, distributor-partners and business associates. None of those who responded corroborated the supposed scale of his operation. Nearly half used Gmail, Yahoo or other personal e-mail addresses instead of company or official addresses. Some did not turn up in online searches and were invisible on professional networks such as LinkedIn and CrunchBase.
Suspicions were first raised when our reporter visited the company headquarters in December to interview Pudur. For a business putatively so large, its profile in downtown Kuala Lumpur is notably low-key. Its offices occupy just one part of the 7th floor in a 26-story building. There are no exterior signs proclaiming its presence. Inside, when a visitor wants to use a restroom, it turns out to be a facility shared with other tenants at the end of a maze of corridors. Pudur says his operation has only 132 employees, which is remarkable given that his flagship technology unit--Celframe--spent $1.6 billion on research & development in 2014, according to its latest annual report. But he says most of that work is outsourced and that there are another 13,700 "indirect" or remote workers.

If you read the article given above, you'll discover more of this person's "karnamas". All in all, this guy is just another mega-cheat and exactly like the fraud who was in the news very recently - Mr. B. R. Shetty. (You can read about him here - Two Indians and lax compliance brought trouble to UAE banks), just another pet-dog of Modi and the PR-BJP.
Now, what's amazing is that the said person is now just another Twitter troll - the blue tick one, whose sole purpose is to remove any sort of agency and influence that an Indian Muslim in the Gulf have to their disposal.
He has now resorted to doxxing Muslims living in the gulf and reporting them to the Ministry of External Affairs, India just because they were targeting the hypocrites leeching of Arab money and then posting Islamophobic content online - dehumanising the already vulnerable Indian Muslims. (Few cases like - Indian expat sacked and faces jail for insulting Islam.)
You can read here (https://twitter.com/arunpudustatus/1261663071644168192) how the degenerate takes pride in calling names to the Muslims they've doxxed - Ola/Uber, Jihadi, etc. Supposedly their aim is to deport him back to India and make him rot in prison. Like they've done recently with UAPA.
Inshallah, I don't think they'll be able to do anything to the said person as he hasn't committed any sort of crime (per UAE law) and there are enough Muslims to help him there.
Things to note here is that:

1. There is a systematic hierarchy being followed by these Indian "dharmic" patriots/trolls on reducing the Indian Muslim to nothing - so that no one is able to hear their point of view.
2. Popular social media channels like Twitter, Quora and Facebook have been completely hacked on behest of the government. A lot of times, you can see a Sanghi commenting first on any sort of post related to Islam before a Muslim.
3. They think they can go scot-free but there has been immense backlash from Muslims world-wide and this is not going well with them, therefore this supposed billionaires(lol) are being employed by the IT cell to target muslims and give impetus to the Rs. 2 per tweet troll army.
4. If you check his tweets, the said fraud has links with Vikas Pandey (twitter.com/ModifiedVikas) who once threatened SC lawyer on twitter who was fighting Ayodhya case. You can even listen to a Tedx talk by him here (check the comments and the like-dislike ratio to know how welcomed he was there)

Forgive my grammar and spelling mistakes.

Introduction

My background; three years of work experience in the financial services industry for a large global firm in the area of asset management. My role is centred around financial statement analysis and basically, just performing due diligence into the fundamentals of a company.
Anyways, the reason I decided to write up this guide for /stocks is that I frequent the subreddit quite often and although there are a few good posters here and there, it seems there is a lot of misinformation that goes around, and thus, I wanted to set out a foundation for a due diligence template that new investors can use so that they can have some sort of basic guideline in terms of what to look out for before buying or selling a stock.
Think of this due diligence template as your starting block. Take it, use it, then modify it to suit your needs when you are comfortable. The template is intended to be adaptable and basic.

1) What does the company do?

Step number uno; figure out what the company does. This is where google is your friend. Simply type up the company's name or ticker into google and read what it is they do.
If you don't understand what it is the company actually does after looking through google, don't invest.
If the company deals with complicated business models that require technical knowledge which you don't have, for example; an early-stage biotech undertaking Phase II clinical trials, don't invest.
If the company is vague about what it does or you're using google translator to read their business description, don't invest.
Generally, the more complicated the business model of the company, the riskier it is to invest. This includes conglomerates that may be involved in many simple business ventures individually, but when bunched up all together, it becomes complicated to analyse and thus, the risk to invest increases (e.g. GE -- to this day, I still think no one knows what they actually do).
So you're probably wondering by now, what is all this talk about risk? Don't worry about that for now, we will get to it later I promise.

2) News

What is currently happening with the company? There is no point wasting your time on further sections of your due diligence process if the company has publicly stated its intentions to file for bankruptcy.
Contrary to step 1, this is where google might not to be your friend. There tends to be a lot of spam articles, advertisements or just plain misinformation on google news. Normally, I just spend a minute on google news before doing some more serious research on better news site such as Reuters (again, simply search the company name).
Do not slack off here. The easiest way to lose money is to buy into a stock when litigations or liquidity concerns are going on which you could had easily avoided with a few minutes of reading the news.
Another reason why the news is important is that it can tell you things that aren't on the financial statements. What you read on the news can and 99% will impact the subsequent steps of this guide i.e., financial statement analysis.

3) Revenue drivers

Revenue is the second most important thing on a company's financial statements, in other words, how does the company make money?
If you're going to read only one thing on a company's financials (which I seriously suggest you do not do), then that one thing should be revenue.
Now, I'm not going to go into too much detail of why revenue is important. That's not the purpose of this guide, I'm not here to teach undergrad finance.
Essentially, just imagine I'm offering you to buy my lemonade stand. Now ask yourself how you should go abouts figuring out how much you should pay for the lemonade stand. If you don't know the answer to this, read up on the time value of money and discounted cash flows.
Anyways, let's move on. Revenue can be found on the first line item in a company's income statement. The breakdown of revenue (i.e., the drivers) can be found in the segment reporting section of the financial statements (just ctrl+f and look for 'segment').
A quick sense check I like to do here before doing anything else is revenue growth over market cap growth for the most recent period (use excel).
If market cap growth is outpacing revenue growth, that's probably a bad sign. Keep in mind that it's not an absolute indicator you should steer away, but it's just a quick and dirty calculation that gives you a general idea of where the stock is at in the market. Remember, we're trying to look for undervalued companies here, not hit blackjack at the casinos.
The two common reasons for why market cap growth is outpacing revenue growth is either that the stock is overvalued or that the market is predicting exponential revenue growth (i.e., revenue growth in the future should outpace this period's market cap growth).
Next, let's figure out the revenue drivers.
Most companies will have multiple revenue streams relating to different business operations, thus, it is important to figure out which one of those streams are driving revenue and by how much -- revenue stream divided by total revenue.
Then, we look at the growth of each revenue stream over the most recent periods. Simply looking at revenue on its own is useless without looking at growth e.g., if revenue growth is declining, you can sure as hell bet that the stock price is declining too.
Assuming you have done both of the above and listed them in descending order, you should now be able to determine which ones are the core revenue drivers.
Personally, I like to use the BCG Matrix as a guideline when looking at the qualitative nature of the revenue drivers but everyone has their own way of doing things.
If the company is generating most of its revenue from Dogs, that's probably a bad sign.
Again, I'm not going to go through what each combination of the BCG Matrix means, have a read through the wikipedia as the information is all there.
This is usually the time when I can determine whether I should spend additional time analysing the company or move onto the next.
If you proceed, here is where things start getting quantitative and time intensive.
Note: In case some of you do not know where to get a company's financial statements, go to the SEC site. Simply search for the company's name, then search for filling type '10-K'.
To be continued in Part 2
tldr;
There is no tldr. If you don't have time to research, then you don't have time to be buying stocks.

For almost 7 years I was a dyed in the wool value investor. I did very well.
As I would look back on stocks I passed on investing over the years I saw many of them went to zero or close to it.
So, I got the bright idea of using LEAP put options on companies I would never go long on.
I started in the casino, hotel, and resort space. I spent two weeks one by one researching and then ranking each company based from strongest to weakest on all the metrics and benchmarks Graham talks about in the Intelligent Investor (interest coverage, what their bonds yielded, working capital, credit rating, etc.)
My goal was to find the absolute weakest company in the sectoindustry. A company with an atrocious balance sheet that was barely surviving.
In my mind I thought it would be the perfect one to bet against.
I found it. It was Penn National Gaming (PENN). They ranked number one as the weakest company. They have billions in debt, negative working capital, negative tangible book value, and not enough money before tax to cover the interest payment.
They have had to continually issue new shares and dilute their stock. Their current shares outstanding are 200% higher than they were 4 years ago.
PENN reached a low of $3.50 during the March crash. When I finished my research it was at $28.
My thesis was that with the company being in such horrible financial shape and their casinos being closed for so long would take the stock back down and potentially make the company file Chapter 11.
Even if their casinos reopened I did not think that they could survive on a fraction of their former traffic.
With all that in mind it seemed like it was possible for the stock to go back to what it was in March.
I had such conviction I invested $1,000 in puts with a $3 strike that expire in January.
I made one big mistake. I didn’t know about Dave Portnoy when I initiated my position. I didn’t think Barstool could generate enough revenue to save them.
Dave Portnoy is the equivalent of Elon Musk in the sports world. Just like Elon’s tweets move Tesla Portnoy has been able to move PENN.
I don’t blame him. I just made the mistake of overestimating the influence one person can have on a stock.
Today the stock is worth $49. I bought my puts when stock was at $28.
I’m down 70%. The money I lost does sting, but it doesn’t bother me.
I went in knowing I could lose it all or make 42X my money. I saw it as an asymmetric bet.
But, at 24 years old this lesson will stick with me the rest of my investing career.
Look beyond the balance sheet

For almost 7 years I was a dyed in the wool value investor. I did very well.
As I would look back on stocks I passed on investing over the years I saw many of them went to zero or close to it.
So, I got the bright idea of using LEAP put options on companies I would never go long on.
I started in the casino, hotel, and resort space. I spent two weeks one by one researching and then ranking each company based from strongest to weakest on all the metrics and benchmarks Graham talks about in the Intelligent Investor (interest coverage, what their bonds yielded, working capital, credit rating, etc.)
My goal was to find the absolute weakest company in the sectoindustry. A company with an atrocious balance sheet that was barely surviving.
In my mind I thought it would be the perfect one to bet against.
I found it. It was Penn National Gaming (PENN). They ranked number one as the weakest company. They have billions in debt, negative working capital, negative tangible book value, and not enough money before tax to cover the interest payment.
They have had to continually issue new shares and dilute their stock. Their current shares outstanding are 200% higher than they were 4 years ago.
PENN reached a low of $3.50 during the March crash. When I finished my research it was at $28.
My thesis was that with the company being in such horrible financial shape and their casinos being closed for so long would take the stock back down and potentially make the company file Chapter 11.
Even if their casinos reopened I did not think that they could survive on a fraction of their former traffic.
With all that in mind it seemed like it was possible for the stock to go back to what it was in March.
I had such conviction I invested $1,000 in puts with a $3 strike that expire in January.
I made one big mistake. I didn’t know about Dave Portnoy when I initiated my position. I didn’t think Barstool could generate enough revenue to save them.
Dave Portnoy is the equivalent of Elon Musk in the sports world. Just like Elon’s tweets move Tesla Portnoy has been able to move PENN.
I don’t blame him. I just made the mistake of overestimating the influence one person can have on a stock.
Today the stock is worth $49. I bought my puts when stock was at $28.
I’m down 70%. The money I lost does sting, but it doesn’t bother me.
I went in knowing I could lose it all or make 42X my money. I saw it as an asymmetric bet.
But, at 24 years old this lesson will stick with me the rest of my investing career.
Look beyond the balance sheet

For almost 7 years I was a dyed in the wool value investor. I did very well.
As I would look back on stocks I passed on investing over the years I saw many of them went to zero or close to it.
So, I got the bright idea of using LEAP put options on companies I would never go long on.
I started in the casino, hotel, and resort space. I spent two weeks one by one researching and then ranking each company based from strongest to weakest on all the metrics and benchmarks Graham talks about in the Intelligent Investor (interest coverage, what their bonds yielded, working capital, credit rating, etc.)
My goal was to find the absolute weakest company in the sectoindustry. A company with an atrocious balance sheet that was barely surviving.
In my mind I thought it would be the perfect one to bet against.
I found it. It was Penn National Gaming (PENN). They ranked number one as the weakest company. They have billions in debt, negative working capital, negative tangible book value, and not enough money before tax to cover the interest payment.
They have had to continually issue new shares and dilute their stock. Their current shares outstanding are 200% higher than they were 4 years ago.
PENN reached a low of $3.50 during the March crash. When I finished my research it was at $28.
My thesis was that with the company being in such horrible financial shape and their casinos being closed for so long would take the stock back down and potentially make the company file Chapter 11.
Even if their casinos reopened I did not think that they could survive on a fraction of their former traffic.
With all that in mind it seemed like it was possible for the stock to go back to what it was in March.
I had such conviction I invested $1,000 in puts with a $3 strike that expire in January.
I made one big mistake. I didn’t know about Dave Portnoy when I initiated my position. I didn’t think Barstool could generate enough revenue to save them.
Dave Portnoy is the equivalent of Elon Musk in the sports world. Just like Elon’s tweets move Tesla Portnoy has been able to move PENN.
I don’t blame him. I just made the mistake of overestimating the influence one person can have on a stock.
Today the stock is worth $49. I bought my puts when stock was at $28.
I’m down 70%. The money I lost does sting, but it doesn’t bother me.
I went in knowing I could lose it all or make 42X my money. I saw it as an asymmetric bet.
But, at 24 years old this lesson will stick with me the rest of my investing career.
Look beyond the balance sheet

Catch the full episode: https://www.wealthformula.com/podcast/237-is-angel-investing-right-for-you/
Buck: Welcome back to the show everyone today my guest on Wealth Formula Podcast is Tom Wallace. Tom is a 40 year veteran of technology startups both as a founder and an investor and, after multiple successful exits most recently selling vector learning for 268 million dollars, he's now the managing partner at Florida Funders which is a hybrid: a venture capital fund and angel investor network focused on finding funding and building the next generation of breakout technology companies in Florida. Tom welcome to Wealth Formula Podcast.
Tom: Buck thanks for having me on your show. I really appreciate it. It's an honor to be here and thanks for hosting.
Buck: Yeah of course. And you know why don't we start out you know this is a sort of a different area for us but why don't you just start out a little bit by talking about your background I know we mentioned that you've been a tech guy, for the most part, your professional life. Talk a little bit about that and you know how you ended up I guess from being on the front lines as maybe an actual startup guide ultimately on the angel investor side.
Tom: Yeah sure so I come from a blue-collar family. Neither of my parents graduated from high school. And so when I got out of college it was 1980 and if you think about that time it was kind of the dawning of the microcomputer or personal computer revolution and I worked for a couple of years for a Fortune 500 company Alcoa my father said it's the only real job I ever had and then at the age of 23 my best friend and I started our first company and we started a company in the personal computer space and had no idea what we were doing we were young we were green. Back then buck it wasn't like today where there's all these incubators and accelerators and all these mentors and so many people you can get help starting you know an entrepreneurship is such a you know a cool thing and such a hip thing back then it was something that not a lot of people were doing and I was like most of the kids I went to college with were looking to go work for IBM or some Fortune 500 company but it was really a special time and we got bit when you got bit by the entrepreneurial bug and if you think back every so often game-changing technology comes along and certainly the late 70s early 80s that was the case with a personal computer if you think about up until that time the only had access to computers were universities large corporations or pretty good sized companies and they were big computers they were expensive and they took a team of geeks to program them yeah that all changed in the late 70s with Apple and IBM introduced their first personal computer in 1981 and compact computer and all that and it really now every person every small business could have a computer and the software that came along with it from people like Bill Gates and Mitch Kapoor of Lotus123 that came along with it you didn't any longer have to be a programmer or geek to figure out how to use this. So we start our business and that was our first company. We exited that about eight years later got about 20 million in sales and then kind of been doing it ever since and an entrepreneur and on the field as is I kind of look at I've been the core I was the quarterback for many years and you know living the daily grind and fight of being an entrepreneur. And I like being on the sidelines at this point
Buck: Got it. So you know we talked a little bit offline about my audience and where you know I tend to be for the most part you know alternative asset investors who are looking for different things generally you know heavily in real estate and that sort of thing. So you know a lot of the nomenclature maybe for this area is going to be a little bit foreign maybe just from an educational standpoint maybe kind of if you would you know you hear a lot of different types of things, words thrown around like angel investing and venture capital and private equity within technology, can you talk a little bit about that and maybe you know kind of where you're focused.
Tom: Yeah sure so I kind of look at it in stages so early, early stage you know say Buck you were going to start a company a technology company tomorrow and you needed to raise a few hundred thousand dollars to get it going. The first thing you would probably do is go out to your family and friends and get them to invest so that's kind of very very early stage probably pre you probably don't have any revenue no customers it's just an idea. The next stage is angel investing and that's when you typically get a little bit past that family and friends maybe you've got some customers now you've got a real product you go out to that group and these are kind of and that and angels have changed over the years but you know many of us do it professionally so these are more sophisticated investors they do a lot of deals they see a lot of deals and we'll talk more about that later. Then if you're successful if your success continues you continue growing you get bigger now you're looking to in that angel round is typically maybe 500 000 to a million maybe a little more maybe a little less, now you're ready for you know a more institutional round or series a these rounds tend to be more like two to three million to 10 million amount amount that you're raising that's venture capital still early but you've got customers you've got some traction and then you know and that really from venture capital private equity is even later stage and the difference in and I spent the last kind of 10 years my career running private equity companies working a lot with private equity guys that's tend to be that tends to be later stage companies they're profitable they put a lot of leverage on them so the private equity companies typically put a lot of debt on these companies so there has to be that cash flow in ebitda to make that happen and so property equity guys are looking for two three four x returns on their companies maybe greater than when we exited vector solutions my last company. I take our last private equity round we provide our investors about eight or nine times their money back venture capital is different game they know they're gonna invest in and by the way private equity guys nothing's going to zero, they're not investing in companies that are going to zero. I mean once a while it happens but it's a rarity where venture capital is a little different game you know and it depends on where you're playing it because if you're playing in New York or Silicon Valley it's a different game than you're playing in Florida but typically we're banking on a certain percentage of our companies going to zero that they're just not going to be successful and you know some we're going to get our money back and we're going to make all our money on kind of the top third that's how we look at Florida Funders the third or third or third but you know the you know the folks out in the valley probably look at it more like you're investing in 10 companies nine are going to zero one's gonna be unicorn and they're gonna make all the returns on the one company. So you know it varies a little differently with you know where you're playing geographically and what you're doing but that kind of is how we look at that paradigm of you know stages of investing in venture capital versus private equity.
Buck: Obviously and you're talking about you you sort of alluded to it a little bit but you know if the tech private equity folks are looking to return you know I think what did you say you know maybe for up to eight three or four three times over a period of how long like a decade or something like that.
Tom: I mean the returns typically they invest in money over a period about three or four years and then the returns start coming in shortly after that and they're out by usually like 10 years right.
Buck: And then with angel, so what's the compelling element that you like and maybe investors should know about your space which is you know the angel investing which is really the earliest I mean after friends and family right so it's certainly the highest risk but yeah so what do you just like the asymmetric nature of that?
Tom: Well it's risk reward so yeah I will admit I personally am a little bit of a deal junkie but you don't have to be. If you look at some of the research, I would never suggest anybody that is you know as they look at their asset allocation across their investments that angel investing should be a large portion of it. It is for me because it's what I do for a living so maybe a chair 20 of my net worth but 10 whatever but typically it's a small sliver two three percent for an investor but if you do it right angel investing can and has historically outperformed every other asset class including venture capital and private equity that is research coming out of the Angel Capital Association Of America. So the problem is most people don't do angel investing correctly. We call this the 5 Ds of angel investing, so diversity, deal flow, due diligence, domain expertise and discipline. So the first mistake most angel investors make I use my brother as an example my brother's a very successful software CEO, he sold his last company for 1.6 billion dollars and I said to him one day Tim you know what about angel investing he said I've done that two or three times I went to zero that doesn't work. Well you really can't do it two to three times because the odds are against you you might as well go to the casino you really need to be up to build a portfolio a diversified portfolio like you have to in most investing, we say 10 to 15 companies you should invest in to really you know have enough diversity. Secondly is deal flow. How many deals do you look at to invest in each one again look at my brother I'm like Tim well how many deals did you look at to do these two or three deals he's like well he just looked at those two or three like you know it Florida Funders and vendor we'll look at 50 deals to do one. So we're highly selective and we're you know we like believe we're getting the best of the best. And then due diligence is how much research and digging in did you do in your process and a lot of research on this 20 plus hours is you know really what you should do to maximize your potential returns if Florida Funders every company we do we have more like 80 to 100 hours of due diligence and this is everything from digging into the the founders and their background their experience to talking to those early customers asking about the product, why they buy it, how important it is, is it nice to have, does it have to have we really get into in their technology, what's your technology stack look like, what's their IP, so that's a big part of it. And then domain expertise and this is investing in what you know. You're a doctor right you're a surgeon so if you were looking to invest in a medical device company you would know a lot more about that than me. So with us at 1000 Florida Funders we invest in software companies software as a service we invest in cyber security fintech edtech digital health areas that all of me and my partners have backgrounds in. So we're investing in what we know. And then the last thing is discipline to be a good investor I would argue real estate I don't know what you're guessing you gotta come up with your your thesis and you gotta stick to it. And the biggest thing we see in angel investing or I see an angel investigators mistake people make is fomo. They invest because all their friends are investing and they don't want to miss out on this deal that is not a good reason to invest and what we found is if you're disciplined and you follow those other four d's and that process and do that over and over again that you're going to be successful and that this can be a very not only successful asset class from a return on investment standpoint but also fun. I mean think about it we'd like to say we get to go to work every day with these young talented smart people who are trying to change the world we're gonna be more fun than that?
Buck: Yeah let's you know exploring some of those d's for a moment one of them I'm thinking about here is you mentioned deal flow and I now you're in Florida. If I'm you know a software developer and I've got something I'm excited about, am I gonna go to Silicon Valley or I mean so how does that factor into this in terms of affecting your deal flow? Do you see some advantages in being you know on the other coast or what's that been like in your experience?
Tom: Yeah we we do see some advantages in Florida is a very unique state we're the third most populous state in the country growing rapidly we have great tax laws we're a very pro state very unlike California in a lot of ways now again they play a different game it's really not California Silicon Valley In San Francisco right I mean by the way all the venture capital invests in the united states goes into 60 of it goes into four little micro markets. Twenty percent goes in Silicon Valley twenty percent san francisco ten percent boston ten percent in new york so forty percent goes to the rest of the world. We have in Florida over the last decade really great success stories and technology companies like Chewy.com, Jetsmart, Fanatics, Knowbe4, Connect-wise, these are all unicorn companies built here in Florida where the people the entrepreneurs didn't leave here to go to Silicon Valley they could have but they didn't and we're seeing more and more of that in fact we're seeing the opposite happen where we're getting calls from from founders are saying we're getting out of the valley we're getting out of San Francisco it's too expensive to the talent google and facebook are sucking up all the talent they pay them they we can't compete with them and we're looking for a pro business state to come to and in the past you know when that happened it was more it was mostly Austin Texas had benefited from that in colorado places like Boulder and Denver but now we're seeing it in Florida and it's exciting and you know we have a lot to offer these founders, we have 45 incubators and accelerators across the state, we have a lot of support systems for entrepreneurs and we're a very pro pro business state. So it's exciting. And then the other thing that's exciting from an investor standpoint is the valuations. You know companies in in Silicon Valley and San Francisco you know they're they don't have any revenues they have an idea and they're worth 10 million dollars you know in Florida most of the companies we invest in already have revenues already have customers somewhere you know the revenues might be 50 000 in annual recurring revenue up to maybe 500 000, but we can invest in them at a valuation of you know free market valuation maybe 5 million 3 million 7 million. So we don't need them to be a unicorn for us to have a very successful exit for us and for our fellow investors and we can get you know 10x 20x 30x returns with a company that's exiting at 100 million dollars which is in the tech world is not a huge exit today.
Buck: Tell me how it works in terms of a typical I mean my you know my listeners are used to you know the types of real estate private equity particularly our accredited investor groups and things like that but how does a fund like this work? Is it you know a typical 2 and 20 type type structure you know and if you could kind of talk about that and you know maybe also some historical in terms of what you're seeing you know obviously not promising anything future wise but what what kinds of results have you guys had?
Tom: Yeah so yes we're two and twenty our fund is a two and twenty fund so it's very typical.
Buck: So two percent annual basically under management and then twenty percent profit right and then right got it so that's pretty standard and then and then in terms of in Florida Funders what kind of you know structures are you looking at are are you doing? Are these regulation D exemption type things or I mean are they 506 c's or are they crowd funding or you know right crowdfunding or how are you structuring these?
Tom: Yeah so the way we work if we're a little different animal. We'd like to think we have a pretty unique model is once a company makes it through our vetting process and we say okay we're gonna invest in you. Our fund will put in the first, say we're gonna raise a million dollars for this company, our fund will put in 500 000 and then we take the 500 000 we go out to our crowd curated accredited investors we only deal with accredited so we're 506 C and then the crowd will fill in the rest, sometimes it's a little light maybe the fun will make up the distance many times it's over subscribed it will raise more for the founder or we'll just shut it off. So you know again we're a little a little bit different.
Buck: Sorry to interrupt but you're saying that each opportunity you're doing separately, you're not doing it as a portfolio like a fund, you're doing each business separately?
Tom: So we have two things we have a fund of our own that many of our just invest in the fund and we invest the money for them, but then we have this curated crowd of accredited investors who invest alongside our fund. So like myself personally I'm an investor in our fund I invest in almost every deal we do as well and I'll vary what I put in the deals based on what I think what I like you know that's that sort of thing. Now we have some many investors that are just in our fund they love what we're doing they're really excited about they're like you know hey we don't know technology, I don't know technology, I don't have time to look at even though you guys do all the due diligence and put it off on the portal and I don't really have to do a lot of work you kind of take the heavy lifting out of angel investing for me, I don't have the time to do it or I don't know tech so why don't I just give you the money and you guys invest it for me. And so we're on our second fund to go back to your question about our returns we're just stamming our first exits from our first fund which is about four years old. We had we'll have we've had two in the last week and one was 1.8 x times your money back and one was a little over two so those are moderate returns in our world yeah and we're playing you know we're we we expect to have some of those but we also expect to have 10x 20x 30x deals and then we expect to have zeros too.
Buck: Right got it. In terms of right now in this day and age specifically talking about a recessionary environment, a pandemic environment, how is this all affecting your business and you know your business is that you invest in you know capital all of these things.
Tom: Yeah it's been interesting because you know if you look back at 2009 2010 the great recession, the one area of investing that really never slowed and took was was early stage tech investing in an angel investing. It didn't really have much of an effect on it. We're kind of seeing that we're still doing deals we're very active or you know lots of deal flow you know some of our portfolio companies were severely affected by cobit but with the PPP loans and we work with our companies we don't just invest in them and leave them alone we take a board seat we get involved we coach them we provide introductions to them we help them in any way we can be successful. Many of them got ppp loans that are going to be forgiven or you know that really helped them a lot some of them pivoted and most of them have really bounced. We lost one there was a restaurant tech company which you know obviously that's not the space you want to be in this downturn in overdays but they weren't doing so great anyway. But a lot you know some you know some of our companies are k-12 education companies most of them have really bounced back now I mean they took a hit but they bounced back. We have companies in the healthcare space that you know they're involved a lot with elective surgery, they obviously took a hit but now they've bounced back. So it's been interesting it's been on you know we we hunkered down there with our companies for a while and said hey our message to them was cut your burn preserve cash you don't know when you're gonna be able to raise money again extend your runway and make sure you can live the fight your way through this and most of them have done that very successfully.
Buck: Where does for for your typical investor and I think you kind of had mentioned a little bit in terms of allocation, but you know if you look at a portfolio of you know 100 of your investable assets, what sort of a rule of thumb people I'm maybe not you know Tom Wallaces the world where you're in the middle of this but if you're looking to get exposure what what do you tell people what is sort of the rule of thumb on these types of things whether it be you know direct technology investments or angel investments or how do you look at or how do you suggest people look at it?
Tom: You know I think it's five percent or less you know whatever you're comfortable with but you know. There's something that's happened out there if you think about technology the days of buying amazon and apple and a couple hundred million dollar valuation rounding that to a trillion dollars or over. Facebook went public the valuation was what 70 billion. Uber went public valuation 40 50 billion. These companies because there's so much venture capital money out there these companies are waiting so long to go public to really get phenomenal returns angel investing is how you're going to do it because you know again companies are waiting so long to go public and so we you know again if you do the five Ds and you diversify you know there there's an opportunity for for great returns here and you know we're only seeing that trend more and more and it's becoming more exciting with all the changes to crowdfunding and all the rules that came out in you know when crowdfunding was first made legal back within six or seven years now so yeah it's an exciting space and it can be one again that you can have a lot of fun with and you can really see some exciting companies and meet some crazy founders great founders a tad crazy yeah and but yeah I'd say five percent or less I mean that's typically what our number would be.
Buck: So before we go maybe just sort of in general like for Florida Funders that's what it's called and what's the website
Tom: Floridafunders.com
Buck: So if you kind of gave us you know your you know your elevator pitch so to speak on on Florida Funders and why to look into it more and how you're different from the other angel groups what would you say to that?
Tom: Our secret sauce has a couple things. One is deal flow we've been named by cb insights and pitch book both those organizations says the most active EC in the southeast the most active venture capitalist in Florida. So we are out and about in the tech community down here, we're very well known. Every month 50 to 100 companies just go to our website and apply for funding. So we're looking at way more deals and as a result we think we're getting access to the best deals. The second part of our secret sauce is the extensive extensive due diligence we do, even more we invest alongside some Silicon Valley venture capitalists some New York venture capitalists and we often have co-investors in our deal and I would argue that almost nobody does the level of due diligence we do and that's everything from really getting to know the founders a lot of this is betting on the jockey to you know those early customers and interviewing them to plugging in a subject matter expert and we tap into our network of 1500 investors and you know we're looking at a health tech digital play you know we're pulling people that have extensive domain expertise who can really work in that space who have years of experience and they really help us evaluate these deals and once we invest they help these companies advise them and mentor them and coach them. So that's kind of what makes us different here at Florida Funders and if you think about you know where the future is for so many states, and obviously you know we're focused on Florida. We like to say we're we're looking to change Florida from a state we want Florida to be as known if not no more for technology and innovation than we are today for the mouse and tourism and strawberries.
Buck: Sure got it. Well listen Tom it's been great and very helpful and educational for my audience here. Again it's Florida Funders like fun having funders dot com Floridafunders.com and Tom I wanna thank you again for being on the show and maybe have you on again sometime and let us know how your next fund does.
Tom: Will do Buck it's been my pleasure. Thank you so much. All the best to you and your listeners and I've really enjoyed spending this time with you.
Buck: We'll be right back.