Rishi Taparia - Issue #61
This week we explore Michael Kors going high end, Restoration Hardware’s revival, Stripe getting big money, the cost of rewards credit cards, podcasting in China, NantEnergy’s awesome new batteries and more. Enjoy!
Commerce
Michael Kors to Buy Italian Fashion House Versace in $2.1 Billion Deal
Luxury is big business! Michael Kors reached a deal this week to buy Italian fashion house Gianni Versace as the U.S. conglomerate expands its global fashion luxury group, effectively telling the world, “We’re upscale, no question about it.” The company will change its name to Capri Holdings.
You May Be Surprised to Hear That Restoration Hardware Is Doing Great
Restoration Hardware is one of those brands that one would expect to be struggling. Huge spaces. Seemingly undifferentiated products. Restoration Hardware seemed doomed. Now, it’s a vast and booming bricks and mortar empire. What gives?
FinTech
Payments Fintech Stripe Valued at $20 Billion in Latest Funding Round
Just last week I mentioned how I thought Stripe would eventually be a more valuable company than Square. Well, this week they took another step. Stripe raised a new fundraising round of $245 million that values the company at roughly $20 billion.
Shoppers Love Rewards Credit Cards. Retailers Hate Them.
Consumers have become addicted to credit cards with generous rewards programs, with companies like Chase spending $1bn per year per card line on marketing related expenses. Retailers are pushing for the right to reject such credit cards (the charges per transaction on these cards are usually higher), which they complain are cutting into their profits.
Uber launches new app and digital wallet in Brazil
We talked a few weeks ago about how Uber is getting into the wallet business. The transportation infrastructure company is now making additional investments to increase penetration in Brazil, its second largest market.
The company has also launched Uber Cash, a digital wallet aimed at the unbanked, which allows credit to be added in advance through the purchase of prepaid cards at high street retailers nationwide. The app, which can also be used with debit or credit cards, allows users to pay for trips or meals on Uber Eats.
Given the complexity of the Brazilian payments ecosystem and the myriad of ways to pay in the country, giving users more ways to pay for rides demonstrates the company’s understanding that payments are local.
Technology
FOMO in China is a $7 billion industry
This is a fascinating piece on the Chinese podcast industry from a few weeks ago. Generating almost $7.3bn a year in revenue (both advertising and subscription) compared to an estimated $314mm in the US (ad revenue), Chinese consumers are seemingly constantly looking for new information due to a combination of factors:
desire for focused information that’s useful and relevant; the need to update skills constantly in China’s competitive job market; the ease of paying on a mobile phone; and FOMO — the fear of missing out.
Cheaper Battery Is Unveiled as a Step to a Carbon-Free Grid
Patrick Soon-Shiong is a fascinating man, having built his fortune developing drugs to fight diabetes and breast cancer and selling the pharma companies associated with those drugs. He recently bought the LA Times, owns a part of the Lakers, and is now tackling energy. His company, NantEnergy, this week unveiled a zinc-air battery that can store energy at almost ¼ the cost of the popular lithium-ion, and without the fire risk. The promise of a carbon-free electric grid is closer than ever.
Random Tidbits
My Friend Wrote a Book Before He Died. Could I Read His Handwriting?
A touching piece on friendship.
Quote I’m thinking about: “When you don’t have the time, you just write. You can always edit a bad page, but you can’t edit a blank page.” - Jodi Picoult