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Tag: Finance

  • Kim Kardashian is Launching a Private Equity Firm

    Kim Kardashian is Launching a Private Equity Firm

    One of the best ways to build wealth is through making critical investments in the proper fields and at the right time. Furthermore, it doesn’t matter what background you have, as long as you have the drive and passion to see your strategies through. In recent decades, celebrities such as Leonardo DiCaprio, Ashton Kutcher, and Serena Williams have joined the venture capital industry and are trying their hands out in different outfits.

    Another notable name throwing her hat in the VC ring is Kim Kardashian, with her newly formed SKKY Partners, alongside Carlyle group veteran Jay Sammons. They aim to make capital investments or take a controlling stake in media and consumer niche start-ups, as Kim posted in a tweet. But before we get on with what Kim is up to, and you would like to also invest in your own capacity, use the link to read more here.

    What are SKKY Partners?

    Although not much about SKKY Partners is known other than what Kim Kardashian has shared on her Instagram and Twitter. We can already tell that it’s a private equity firm that will be making key investments in companies in the consumer, hospitality, digital, and media sectors. Kim founded the company with her business partner, Jay Sammons, who has been in the industry for a while and has had a hand in brands such as Supreme, Vogue, and Beats by Dr Dre.

    If that wasn’t impressive enough, Kim’s mom, Kris Jenner, who many credit for creating the Kardashian empire, will be joining them as a partner in the firm. An impressive lineup of business acumen and influential figures indeed. But to understand Kim’s current move, you have to take a step back and look at some of her other investments.

    In 2019, Kim successfully launched her own line of shapewear, SKIMS and a skin care products line called SKKN. Not to mention her younger sister Kyle had also launched a very successful cosmetics brand, even though she has since sold it off. The point is that the Kardashians are quickly growing in the skincare and beauty sector, and SKKY Partners may be a front to kill the competition before they even become competitors.

    Or the Kardashians have big hearts as their family is and are seriously going to help young entrepreneurs find the same success they have. As we had mentioned earlier, we really don’t have much information on the new venture, and only time will tell.

    In addition, neither Kim nor the company’s website has shared anything about how they will raise their capital or if they will be funding the venture themselves. But if we know one thing about Kim, both options are a viable possibility, and her business drive will more than likely mean something will come out of SKKY Partners.

    What is a Private Equity Firm?

    A private equity firm is a company that invests in private companies that have not yet gone public. In some instances, they can enter into a partnership with the owners to run and manage the companies, while in others, they prime them for repackaging and reselling. However, they are not just limited to private companies and can also acquire public ones for the same reasons.

    Most private equities run-off funds pooled together from institutional and accredited investors who earn dividends. Furthermore, private equities operate similarly to venture capitals and hedge funds and are an alternative form of investment for investors and founders. Therefore, positioning SKKY Partners as a force to be reckoned with in the investment industry and potential creators of the next most significant companies in their areas of interest.

    Bottom line

    The saying, make hay as the sun shines, may mean the same to us but might be more significant if you’re a celebrity. Everyone in this field understands that there will come a time when your star doesn’t shine as bright as it used to, and it’s essential to have a plan B for when that time arrives. The more challenging question then becomes what to invest in to secure a great future. Fortunately, many celebrities have found success investing in industries such as VCs and hedge funds. Kim Kardashian is the latest entry with her private equity firm, and we wish her the best of luck as she endeavors in this next chapter of her life.

  • How to Start Investing When You’re Broke

    How to Start Investing When You’re Broke

    For a long time, investing money seemed out of reach for the average person. Even today, many assume that one needs thousands of dollars to begin their investment journey. Thankfully, that’s no longer the case, courtesy of online investment services and robo-advisors!

    What are robo-advisors?

    Robo-advisors are online automated investment advisors (such as Acorns or Betterment). Their exact capabilities and duties vary per platform. Still, a robo-advisor will generally automatically manage the money you provide it with. Once it places your money into an ETF (Exchange-traded fund), your funds will be instantly diversified amongst all the stocks in that particular ETF. Most robo-advisors offer multiple ETF portfolios for you to choose from, which may differ by:

    • Risk (the overall volatility of the stocks contained within the ETF)
    • Purpose (e.g., retirement, savings, or cash flow)
    • Social causes (e.g., sustainable energy)

    The exact options available will largely depend on the robo-advisor platform you decide to use. However, it’s important to note that you can only choose the ETF: you can’t select the individual stocks! This differs from alternative investment methods, which often give you precise control over your investments. Still, robo-advisors do all the work for you. They don’t require much beginning capital, making them ideal for those with limited investing experience.

    The “Hands-On” Approach

    If the idea of using a robo-advisor doesn’t sound appealing to you, don’t worry. There are other options available that allow you to control exactly where your money goes. True, higher-end investment opportunities like AcreTrader or  First National Realty Partners may require a large upfront deposit. However, many online services allow you to begin investing for as little as $5!

    How It Works

    Services that allow you to trade stocks (like Robinhood) will enable you to invest even small amounts of money. For $10, you’ll be able to purchase entire shares of some stocks. However, some stocks cost hundreds of dollars. Services like Robinhood allow you to buy partial shares, making it possible to invest in major companies despite not being able to afford total shares!

    Many of these services allow you to purchase ETFs and crypto as well. Similarly, you’ll be able to buy percentages if you can’t afford the entire investment. These services are an excellent way to diversify your portfolio by yourself, but the downside is you’ll need to know what to invest in. Managing a successful portfolio on your own will be more time-consuming than using a robo-advisor. Still, if done correctly, it could also be more lucrative!

    Costs and Fees

    Most platforms will require payment at some point. Although commission-free trading is common online, there are still a variety of costs you could incur. Here are a few of the costs to consider when selecting a trading platform:

    • Monthly membership fees
    • Maintenance fees
    • Commission fees
    • Regulatory transaction fees
    • Trading activity fees
    • ADR (American Depositary Receipt) fees

    Setting Realistic Expectations

    Although it is certainly possible to become rich overnight, this is unlikely to become a reality for most people. Doing so would require making hazardous investments, a lot of luck, and perfect timing. As such, you should set realistic expectations for your investing endeavors.

    Fortunately, that doesn’t mean investing is a waste of time. Quite the contrary: you can generate high returns over time! Many people simply place their money into savings accounts, but these accounts offer a very low APY (Annual Percentage Yield) and can quickly be outpaced by inflation. Let’s take a quick look at how a savings (X%APY) would perform over 10 years.

    Savings Account

    Initial investment: $10,000

    APY: 0.13%

    Balance after ten years: $10,130.85

    As you can see, the return will be abysmal with a savings account, even after a decade! On top of that, inflation rates generally reduce your return’s value by 2-3% each year. Although you will technically have more money, your purchasing power will be reduced! Of course, this is better than leaving your money in a non-interest earning account, but it’s not the best option. 

    Next, let’s compare the same capital ($10,000 for ten years) invested in the stock market. Generally, the stock market has a 10-11% return, averaging a 7% APY after adjusting for inflation.

    Stock Market

    Initial investment: $10,000

    APY: 7% 

    Balance after ten years: 20,136.16

    As you can see, the stock market is a much better investment opportunity than simply using a savings account! However, just because—based on historical data—your funds should grow doesn’t mean your funds will grow. Unfortunately, loss is part of investing, so it’s essential to factor risk into your investments.

    Determining the Appropriate Risk Level

    Online robo-advisors will generally allow you to choose a portfolio based on the “risk factor.” Investing in individual stocks means you’ll have to assess the risk factor yourself. Essentially, the “risk factor” equates to volatility. Investments with higher volatility offer greater returns but also increase the chance of losing your money. Investments with lower volatility offer lesser returns but are less likely to depreciate in value.

    Generally speaking, high-risk investments are suitable for younger investors with time to recover from losses. Low-risk investments are the preferred option for older investors who won’t have time to recover from losses.

    Investing for Your Future

    The best time to start investing was yesterday; the second-best time to start investing is today! However, you should never begin investing without doing some research first. Compare different options, analyze the risks, and weigh the potential outcomes before taking your first step to a better financial future.

  • How Veterans Can Take Charge Of Their Finances

    How Veterans Can Take Charge Of Their Finances

    When you’re a member of the armed forces, life can be pretty formulaic. Career paths and decisions, duties, and responsibilities are often predictable. 

    Once a service member is honorably discharged and transforms into a veteran, though, it’s up to them to maintain the momentum — including with their finances. This can feel intimidating at first, but there are several steps that a vet can take in order to recapture that energy. 

    If you’re a vet, use the tips below to take charge of your finances and set yourself up for a comfortable future.

    1. Start With the Basics

    Before you get too complicated, make sure you have the basic elements in place. This starts with a budget.

    If you haven’t reworked your budget recently (or you don’t have one in the first place) take some time to do that now. 

    Start with income. In the past, you could use something like a military pay calculator to get a solid idea of what your income would be. As a vet, you may have a less predictable timeline for your income. All the same, do your best to create a conservative estimate of what your income will be moving forward.

    Once you know your income, you can create a budget. List out your expenses and make sure that you’re living within your means and are paying down debt on a regular basis.

    2. Check Your Credit

    As a vet, you have access to things like VA loans. Even so, it’s a good idea to check the condition of your credit.

    Start by checking your credit score. A good score is typically anything over 670. 

    If you’re below that point, you should make a plan to improve your credit. You can do this in many different ways, such as paying down credit and making sure you don’t miss any payments.

    It’s also a good idea to review your credit reports for any errors. Get a free copy of your reports from the three credit bureaus and then give them a once over. If you find any errors, you can dispute them by contacting the bureaus.

    3. Reduce Expenses and Attack Debt

    Next up, look for ways to reduce your expenses. This is a great exercise to plan on every few months.

    You can cut savings in countless different ways. For instance, review your streaming subscriptions and see if you can reduce them to one or two at a time, or check with your insurance provider to see if you qualify for any veterans auto insurance discounts.

    You can also adopt the “30-Day Rule.” All it requires is deferring any non-essential purchases for 30 days to see if an item or service is really something you want to buy.

    As you free up cash, look for ways to redirect it toward things like debt and savings.

    4. Plan for the Short- and Long-Term

    As you regain control of your finances, make sure to plan for both the short and the long term.

    For instance, as you break down your budget and cut expenses, consider setting up a rainy day fund. Ideally, a fund like this should be at least three months of living expenses, so it can take some time.

    You can also direct some of your extra funds toward long-term savings. The most obvious candidate here is retirement, but you can also set other goals. Does your child need to go to college? Do you want to pay off certain debts?

    Keeping your short- and long-term financial health in mind at the same time is always a good idea.

    5. Use the Veteran-Specific Resources Available

    Finally, take the time to familiarize yourself with the different veteran-specific financial resources available. 

    There are a lot of options out there, and each one serves a different purpose. From emergency assistance to personal fundraising to debt management support, it never hurts to stay up-to-date on the financial resources you can tap as a veteran.

    It can be hard recapturing the momentum of your personal finances as a veteran. The good news is that you’re not alone. There are thousands of vets just like you trying to take charge — many with tremendous success.

    Use the tips above to realign yourself and establish a financial strategy. Then apply yourself with grit and determination, and before long, you’ll start to see the results.

  • 4 Types of Investments You Should Be Considering

    4 Types of Investments You Should Be Considering

    Smart investors create diversified investment portfolios. With diversified holdings, investors can weather the ups and downs of markets and spread risk.

    Developing a diversified portfolio requires diligence, planning, and research. However, the hard work is likely to pay off for investors who put in the time.

    Defining Portfolio Diversification

    Diversification is a commonly used investment strategy. Investors spread their investments across different types of securities and other assets to lower the risk of market volatility. Another phrase for portfolio diversification is asset allocation. You’ll want to spread your available investment capital across asset types. Stocks, bonds, and cash are among the most common assets in a portfolio. Increasingly, investors are also using alternative investments as part of a portfolio diversification strategy.

    One goal of portfolio diversification is to ensure there is minimal exposure to one particular asset class. That’s why healthy portfolios will blend disparate asset types together.

    Diversification helps you improve your returns as well. By not putting all your capital in one asset class, you can protect against market volatility.

    Portfolio diversification is different for every investor. Each of us has a different risk tolerance, preferences, and needs depending on where we are in our lives. These factors play into how people diversify and in which ways.

    Benefits of a Diversified Investment Portfolio

    More than anything, portfolio diversification minimizes the risk of loss. If one investment performs poorly, you can look to other investments that may not be subject to the same downturns. Overall, you’re more likely to reduce the possible losses in your portfolio. That’s why it’s unwise to concentrate all your capital in one investment type.

    A diversified portfolio also lets you preserve capital. If you are close to retirement, accumulation may not be your top investment goal. Instead, you may want to preserve capital. With a healthy investment mix, you’ll be able to do just that.

    Another major investment strategy is to generate returns. Diversifying a portfolio means you are less reliant on one asset class to generate desired returns.

    You also want to be able to spend time on things other than reviewing your portfolio. A diversified portfolio means you’re no longer spending time just studying the stock markets, for example. You can focus on a long-term approach and not obsess over your portfolio every day with a diversified investment strategy.

    4 Types of Assets for a Diversified Portfolio

    You can diversify in many ways. But the most foundational is to a portfolio with many different asset types. Here is a closer look at 4 types of assets.

    1. Alternative Investments

    Increasingly, investors are turning to alternative investments for portfolio diversification.

    Alternative investments are assets that do not include stocks, bonds or cash. In many cases, these investments are different in several distinct ways. They typically cannot be sold easily or converted to cash.

    Alternative investments include assets not found in most investor portfolios.

    Private equity is one alternative investment to consider. Private equity investments provide capital for private companies. In most cases, large venture capital companies provide private equity in various stages. However, individual investors can also commit to private equity as part of an investment strategy.

    Private debt investors act in the same way that banks do, providing financing that supports a company. Companies often look for private debt investors when they need additional funds to fuel business growth. In exchange for the investment, companies pay investors to repay the initial loan and interest payments.

    Cryptocurrencies such as Bitcoin are an increasingly popular alternative investment. Cryptocurrency uses blockchain technology, which records each transaction in a block. It also creates a chain to show the ownership timeline. Blockchain provides a secure, trackable way to manage investments.

    Other alternative investments include real estate, commodities, and hedge funds.

    2. Stocks

    Stocks are purchased shares in publicly held companies, which provide shares in exchange for operating capital. Stock is traded on public exchanges, or stock markets, where prices fluctuate.

    There are different types of stock. Some stock classes are only offered to employees, for example. These shares often come with restrictions, such as when they can be sold.

    You can diversify your portfolio by holding stocks and holding different types of stocks. For one, you can purchase stocks in different industries or sectors. Intermingling stocks of various types helps you weather variances in one sector.

    Another way to diversify your stock holdings is to look at size or market capitalization. Market capitalization is the total value of a company’s issued and tradable stock shares. Investors often choose a mix of large-cap, mid-cap, and small-cap stocks. Large companies tend to withstand market downturns more easily but have less growth potential. Smaller companies may have more volatile prices but can pay off richly in the long term.

    3. Bonds

    Bonds are loans that an investor makes, either to a government, a business, or a federal agency. In return, the investor receives interest payments over a specific term. Investors also receive repayment of the principal when the bond matures.

    Bonds are secure investments but often at lower rates of return than stocks. You can buy bonds from many different entities, including the U.S. government, cities, international bodies, or corporations. There are also bond mutual funds and bonds issued by financial institutions, such as mortgage-backed securities.

    Bonds help these agencies and governments support operations, build new buildings and improve infrastructure. Bond types include U.S. treasury securities, U.S. savings bonds, municipal bonds, and agency securities.

    4. Mutual funds

    Mutual funds are bundles of stocks, bonds, or other assets that are grouped together. Often, mutual funds share similar features, such as groups of stocks in an industry or of the same size.

    Mutual funds by their very nature are a way to diversify your portfolio. They are designed to accommodate different investment strategies, risk profiles, and investor styles.

    Mutual funds are managed by professionals who look to buy and trade stocks to improve their standing and returns. The funds pool money from multiple investors and invest those monies based on identified investment goals. These defined parameters and objectives guide decisions made by fund managers. The success of these funds largely depends on the skills of the fund’s managers.

    The ability to diversify a portfolio helps investors stay secure, smart, and protected in their investment choices. Portfolio diversification helps meet short- and long-term investment goals and remain protected from volatility.

  • Russian Financial Sanctions: How it Affects Global Markets and Average Citizens

    Russian Financial Sanctions: How it Affects Global Markets and Average Citizens

    Russia’s invasion of Ukraine marked the beginning of some of the biggest economic sanctions seen in recent times. Countries like the U.S, France, the U.K, and Canada have removed the ability for Russian banks to procure payments across nation lines. The US in particular has begun particularly drastic measures, stopping the export of important technology to Russia while also refusing all imports of Russian oil and gas. Let’s learn more about Russian financial sanctions below.

    Companies in the U.S such as Mastercard, Visa, and Apple have also stopped any payments coming in and out of Russia. Other companies outright removing their services in Russia. Meanwhile countries such as England are looking to follow in the US’s footsteps as the year passes, pledging to stop any oil imports before the year ends. 

    The Russian Economic Impact

    All of this together is projected to contract Russia’s economy by up to 15% in 2022. This is a sizable dip to any economy and when it comes to showing Russia that the war on Ukraine is disapproved of, this is the strongest non-combat based option. This is not the most extreme sanctioning available, trade in some markets still existing with Russia, but a dent is being made. There are notable side-effects to this strategy though, same as any, and these affect both the common people of and those sanctioning Russia.

    Sanctions tend to affect the most vulnerable and common people of a country more than its government at large, an unfortunate necessity when it comes to implementing sanctions aggressively enough to spur change. This means interest rates have risen 10.5% in Russia, and the value of currency, the ruble, has been fluctuating by up to 30%. Citizens of Russia have rushed to buy precious metals such as gold and palladium due to these market changes. The value of these metals increasing four times over. The Russian government has moved to stabilize its economy but with clear potential consequence to its citizens.

    Outside of Russia there are also massive economic effects that come with isolating a nation as powerful as it. Most notably Russia is the second largest producer of crude oil globally. The sanctions on oil have led to the highest recorded gas prices in the US at $4.42 per gallon on May 12, 2022. Beyond this the stock market in the U.S has also reached some of the lowest lows since 1970 and cryptocurrency has been in a notably volatile state. The market seems to be veering towards low investment and high volatility, a negative economic state for any nation.

    In Conclusion

    These are some of the serious consequences to sanctioning Russia in a meaningful capacity. Although these consequences are necessary evils to an effective sanction. If the U.S and other western countries want to stop or slow the invasion on Ukraine, sanctioning is a necessary step. Still, it’s important to recognize the effects on day to day citizens and markets. There’s give and take to any international policy, and things like the rising gas prices are one of the things that have to be given.

    Learn more about Russian financial sanctions below:

    financial war
    Source: USGoldBureau.com
  • Inflation: What It Is and How to Protect Your Finances

    Inflation: What It Is and How to Protect Your Finances

    Inflation is rising as we continue trekking through this pandemic. In 2021, the US Consumer Price Index rose nearly 7%. With the Federal Reserve aiming to keep it at 2% or less each year, why have rates skyrocketed this year? To answer this question, first we need to understand what inflation is and why it occurs. 

    Inflation is an increase in the price of goods or services due to weakening currency caused by different economic triggers. These triggers can be things like surge in product demand, production cost increases, supply chain breakdowns, or changes in the housing market. There have been two major theories that have been presented regarding why inflation occurs. The first is the cost-push theory which explains that higher costs of services or production of goods raise overall prices. The second is demand-pull theory which suggests that when demand for goods outpaces the availability of them, it raises the prices. 

    Both of these theories work to explain why it is rising so high in these times of the pandemic. With mass stay-at-home orders being enforced early in 2020, many production jobs were lost which lessened the availability of products and resulted in rising prices. New safety and sanitary procedures added more fees for businesses to pay which raised the cost for production of goods. This explains why rates are rising, and in fact America is experiencing the biggest jump in more than 30 years.

    The History of Inflation

    This is not the first time this country has experienced a large jump in inflation. After the Revolutionary War, America experienced the biggest jump in it’s entire history with inflation rates at nearly 30%. In the 1970’s the Great Stagflation saw inflation rise to over 14%. So while the rise of 7% we are experiencing today may seem daunting, we have experienced worse economic strife in the past. 

    Something we may have to prepare for is the possibility of a recession. The United States has experienced more than 19 recessions in the past 100 years, notably The Great Recession which occurred in 2008 due to policies trying to reduce inflation. The U.S has been known to enact strategies to control inflation, but as seen with The Great Recession, these strategies can have unintended consequences. 

    Inflation Trends

    So what can we expect from these ongoing inflation trends? Well on a positive note, we can expect lower unemployment rates and higher wages. In 2021 unemployment dropped to 4% and the average hourly wage rose 5%. Unfortunately, we can also expect lower savings rates, increased interest rates, and overall higher costs of living. As we’ve seen in the past, inflation is inevitable, so what can you do to prepare? 

    Investing your money into rental properties and commodities like industrial metals have a great ROI percentage and may be a good way to prepare for rising cost of living. Consider continuing your education, as 30 million Americans could be earning 70% more with a college degree. There are many other ways to prepare for the effects of inflation, learn more in the infographic below: 

    Why is Inflation so High?
  • Mastercard Buys CipherTrace to Boost Its Own Crypto Capabilities

    Mastercard Buys CipherTrace to Boost Its Own Crypto Capabilities

    Mastercard announced it has acquired CipherTrace, as the payments company continues to expand its crypto capabilities.

    Cryptocurrency is quickly going mainstream, with companies large and small supporting the technology. That adoption is extending to traditional finance and payments companies, such as Mastercard.

    CipherTrace is a crypto intelligence company with a focus on the intersection between consumer privacy and the blockchain economy. Mastercard sees the company as a valuable element in creating an atmosphere of trust and security in the realm of cryptocurrencies and digital assets.

    “Digital assets have the potential to reimagine commerce, from everyday acts like paying and getting paid to transforming economies, making them more inclusive and efficient,” said Ajay Bhalla, president, Cyber & Intelligence at Mastercard. “With the rapid growth of the digital asset ecosystem comes the need to ensure it is trusted and safe. Our aim is to build upon the complementary capabilities of Mastercard and CipherTrace to do just this.” 

    “We help companies – whether they are banks or cryptocurrency exchanges, government regulators or law enforcement to keep the crypto economy safe,” said Dave Jevans, CEO, CipherTrace. “Our two companies share this vision to provide security and trust throughout the ecosystem. We are thrilled to join the Mastercard family to scale CipherTrace’s reach across the globe.” 

    Terms of the deal were not disclosed, although it is expected to close by the end of the year.

  • Biden Executive Order to Target Increased Competition

    Biden Executive Order to Target Increased Competition

    President Joe Biden is signing an executive order aimed at increasing competition in the US market.

    Consolidation has been a major force in the American market for decades. Mom and pop shops have steadily been forced out as entire industries have become dominated by a handful of major players. According to the Biden administration, this consolidation and lack of competition costs American families some $5,000 per year.

    That lack of competition drives up prices for consumers. As fewer large players have controlled more of the market, mark-ups (charges over cost) have tripled. Families are paying higher prices for necessities—things like prescription drugs, hearing aids, and internet service.

    To address the problem, President Biden is preparing to sign an executive order that would involve more than a dozen federal agencies and 72 initiatives aimed at tackling the problem across multiple industries.

    The action is expected to benefit the labor market, healthcare, transportation, shipping, agriculture, internet access, banking and finance, as well as increase competition in the tech industry by adding additional scrutiny of mergers and acquisitions.

  • WhatsApp Now Delivering Over 100 Billion Messages a Day

    WhatsApp Now Delivering Over 100 Billion Messages a Day

    WhatsApp is now delivering over 100 billion messages a day, solidifying its position as one of the most popular communication methods.

    In February WhatsApp made headlines when it announced it had crossed the two billion users mark. The platform shows no sign of slowing down, with Will Cathcart, Head of WhatsApp at Facebook, announcing the latest milestone.

    Facebook has been looking for ways to monetize WhatsApp to help recoup the $19 billion the company paid to acquire it. After flirting with the idea of ads within the app, the Facebook pivoted to business and finance options instead. In July the company announced its WhatsApp Business app had cross the 50 million users mark.

    Given the platform’s popularity, there is still plenty of room for Facebook to grow WhatsApp’s business and finance services.

  • Facebook Suffers Setback As Brazil Suspends WhatsApp Payments

    Facebook Suffers Setback As Brazil Suspends WhatsApp Payments

    Facebook’s plans for WhatsApp have suffered a setback as Brazil’s central bank has suspended payments within the app.

    Facebook has been looking for ways to monetize WhatsApp and help recoup its investment in the messaging service. After flirting with the idea of ads, it decided to focus on financial services instead.

    Brazil was the first country in which Facebook integrated payments into WhatsApp, although it now appears that rollout was short-lived. According to TechCrunch, “Brazil’s central bank said it was taking the decision to ‘preserve an adequate competitive environment’ in the mobile payments space and to ensure ‘functioning of a payment system that’s interchangeable, fast, secure, transparent, open and cheap.’”

    Facebook will likely continue rolling out the payment service in other countries, and it remains to be seen if the company can do anything to address Brazil’s concerns. Either way, this is a significant setback for the social media giant.

  • Samsung Joining Tech Giants In Offering Debit Card

    Samsung Joining Tech Giants In Offering Debit Card

    Samsung is the latest tech giant to announce plans to offer its own branded debit card.

    The banking and financial markets are quickly shaping up to be the next frontier for tech giants. Moving into the space helps keep the companies’ customers invested in a specific ecosystem, one that goes beyond basic electronics. Apple unveiled its Apple Pay card, T-Mobile launched T-Mobile Money bank accounts and Google recently announced its intentions to launch its own debit card. Samsung is now joining the club, expanding its Samsung Pay to include a debit card.

    “In 2020, Samsung Pay will be expanding our service from being a rewarding way to shop and pay, to also being a rewarding way to manage money,” reads the press release. “Over the past year we have been busy developing a mobile-first money management platform. Our vision is to help consumers better manage their money so that they can achieve their dreams and goals. Now more than ever, mobile financial services and money management tools will play an even bigger role in our daily lives while also opening up new possibilities.

    “As a first step to this broader vision, this summer Samsung in partnership with SoFi will introduce a new Samsung Pay experience with an innovative debit card backed by a cash management account. We are excited to share more details in the coming weeks.”

    Samsung’s customers will no doubt enjoy the expansion of Samsung Pay, while the company will benefit by keeping people in its ecosystem.

    Samsung Joining Tech Giants In Offering Debit Card

  • Use Apple Card to Buy An iPhone With Zero Interest

    Use Apple Card to Buy An iPhone With Zero Interest

    Earlier this year, Apple unveiled the Apple Card, a credit card issued in partnership with Goldman Sachs. Today, the company took the next logical step, announcing that Apple Card can now be used to purchase an iPhone interest-free for 24 months.

    According to Apple’s website, “just choose your new iPhone and then select Apple Card Monthly Installments as your payment option in the Apple Store app or online at apple.com. If you don’t have Apple Card, you can easily apply when you check out on your iPhone. Or you can visit an Apple Store and a Specialist can help you purchase an iPhone with Apple Card Monthly Installments. You can also apply for Apple Card in the Wallet app on your iPhone before you go shopping for your next iPhone.”

    The iPhone’s purchase price will be decided into 24 monthly payments, paid via Apple Card Monthly Installments. The Monthly Installments can be monitored and maintained in the Wallet app.

    The new option is similar to that offered by many carriers, with the cost of the phone split into interest-free payments across 24 months. One advantage of using the Apple Card, however, is that the purchase earns 3 percent Daily Cash. Apple makes a point of highlighting that users don’t have to wait the full two years to get the Daily Cash. Instead, it is immediately added to Wallet.

    This promotion is just the latest example of why tech companies are increasingly moving into the finance market, and the integration benefits that come from doing so.

  • Uber Wants to Go Public in 18-24 Months, According to Leaked Documents

    Uber Wants to Go Public in 18-24 Months, According to Leaked Documents

    According to a leaked presentation to potential investors in China, Uber plans to go public in the next 18-24 months – putting the IPO sometime near the end of 2016 to the middle of 2017.

    Reuters reports on the documents, which also include plenty of financials.

    According to the presentation, Uber is expected to see global bookings of $10.84 billion this year. Considering Uber takes 20% of that, it appears that Uber’s 2015 revenue would be around $2 billion.

    Uber projects $26.12 billion in bookings next year.

    “Bookings reached $2.91 billion last year and $687.8 million in 2013, according to the presentation, which does not feature expenses or say whether Uber is profitable,” says Reuters.

    So, bookings have more than tripled over the past year.

    As far as whether or not Uber is profitable, it’s unlikely at this point. A recent report from Bloomberg revealed $470 million in losses of the company. Uber is currently spending a lot of money to expand.

    Last month, Uber reportedly raised another $1 billion in funding, valuing the company at over $50 billion.

    Uber says it “doesn’t comment on rumor and speculation.”

  • Facebook Patents a Way to Let Lenders Reject You Based on Your Friends’ Crappy Credit

    Facebook’s filed a new patent, and it might make you think twice about the (virtual) company you keep.

    Here’s the abstract of Facebook’s new patent:

    In particular embodiments, a method includes accessing a graph structure comprising a plurality of nodes and edges where each node represents a user, receiving a request to transmit content related to a first user to a second user, and prohibiting transmission of the content to the second user if the first user and the second user are connected in the graph structure through a series of edges and nodes that comprises an unauthorized node.

    Ok, pretty generic (like a lot of patents).

    The “first embodiment” of the patent addresses a way to fight spam content, and the second deals with search.

    But when you get down to the fourth use for the ‘invention’, it starts to get a little dicey.

    “In a fourth embodiment of the invention, the service provider is a lender. When an individual applies for a loan, the lender examines the credit ratings of members of the individual’s social network who are connected to the individual through authorized nodes. If the average credit rating of these members is at least a minimum credit score, the lender continues to process the loan application. Otherwise, the loan application is rejected,” reads the patent.

    In theory, Facebook says it could develop a way to let lenders use your friends’ credit scores to determine whether or not they want to give you a loan.

    Gee, no thanks.

    Of course, this is just a patent – tech companies files tons of these and they never materialize into actual products.

    But, no. Just no.

    [USPTO via The Next Web]
    Image via Mark Zuckerberg, Facebook

  • Uber Is Now a $50 Billion (Valued) Company

    Throw some more money on the Uber stacks. The on-demand car company has just raised another cool $1 billion, according to sources quoted in the Wall Street Journal.

    The $1 billion brings the total funding to $5. The company is now valued at just shy of $51 billion.

    This round was brought to you by Microsoft and Indian media company Bennett Coleman & Co.

    The WSJ has this interesting tidbit, showing just how fast Uber reached its $50 billion valuation:

    Uber’s valuation has now reached the high-water mark set by Facebook in 2011, when Goldman Sachs offered wealthy clients outside the U.S. shares of the social network that implied a $50 billion valuation, not including the money raised.

     

    At the time, Facebook was nearly seven years old. Uber just turned five.

    In other Uber and a billion dollars news, the company announced intentions to pump $1 billion into an expansion in India.

    “We are extremely bullish on the Indian market and see tremendous potential here,” Amit Jain, president of Uber India said in a statement on Friday. “Uber has grown exponentially in India.”

    China too.

  • Facebook Earnings: $4.04 Billion in Revenue, MAUs Climb to 1.49B

    Facebook has just reported its second quarter earnings, and the company has topped analyst expectations.

    Facebook posted earnings of $0.50 per share on $4.04 billion in revenue. Wall Street forecasted earnings of $0.47 per share on $3.99 billion in revenue.

    “This was another strong quarter for our community,” said Mark Zuckerberg, Facebook founder and CEO. “Engagement across our family of apps keeps growing, and we remain focused on improving the quality of our services.”

    Screen Shot 2015-07-29 at 4.08.08 PM

    According to its report, Facebook generated 76% of advertising revenue from mobile, up from 62% in Q2 2014.

    Facebook’s monthly active users rose to 1.49 billion, up from 1.44 billion last quarter.

    Last quarter, Facebook posted revenues of $3.54 billion, a 42% year-over-year increase. Still, it was the first time the company had come in light on revenue Analysts predicted revenues of $3.56 billion.

    Image via Facebook Menlo Park

  • Twitter Earnings Beat Expectations, but User Growth Remains Flat

    Twitter Earnings Beat Expectations, but User Growth Remains Flat

    Twitter has just reported its Q2 earnings, and it’s beaten expectations.

    Twitter posted second-quarter earnings of $0.07 per share on $502 million in revenue. Wall Street expectations were $0.04 per share on $481 million in revenue.

    “Our Q2 results show good progress in monetization, but we are not satisfied with our growth in audience,” said Jack Dorsey, interim CEO of Twitter. “In order to realize Twitter’s full potential, we must improve in three key areas: ensure more disciplined execution, simplify our service to deliver Twitter’s value faster, and better communicate that value.”

    Here’s why Dorsey’s disappointed in audience growth – Twitter only boasts 316 million monthly active users, up 15% year-over-year and only about eight million more than the company posted last quarter.

    Twitter says mobile MAUs make up about 80% of total MAUs.

    That anemic growth is definitely a concern, and one that Twitter’s next CEO will be tasked with improving. Speaking of that, the new CEO will most likely be in place before next quarter, and it’s still very much up in the air as to who it’ll be.

    Here are some revenue specifics:

    Advertising revenue totaled $452 million, an increase of 63% year-over-year. Excluding the impact of
    year-over-year changes in foreign exchange rates, advertising revenue would have increased 71%. Mobile advertising revenue was 88% of total advertising revenue. Data licensing and other revenue totaled $50 million, an increase of 44% year-over-year. US revenue totaled $321 million, an increase of 53% year-over-year. International revenue totaled $181 million, an increase of 78% year-over-year.

    What was Wall Street’s reaction? Mixed, really. Twitter stock popped and then fell again in after-hours trading. It’s shot back up a bit, but only slightly.

    Check here for the full report.

  • Spotify Hits 20M Paid Users, Defends Artist Payouts

    Spotify has a message for Apple and its new Apple Music venture – you’re starting well in the hole.

    The streaming music company has just announced it has hit 20 million paid subscribers, and 75 million total active users (meaning 55 million free tier users).

    Year-over-year, that’s a 100 percent increase in paid users. In May of 2014, Spotify reported 10 million paid subscribers and 40 million total active users. In January, those numbers were 15 million and 60 million, respectively.

    The new figures mean something significant for Spotify – it’s the first time the ratio of paid subs vs total subs has increased in about two years.

    In a blog post, Spotify also pushed back at claims that it’s bad for artists. According to the company, it paid out over $300 million in royalties in the first three months of 2015.

    “More people listening on Spotify means more payouts to the creators of the music you love. As we grow, the amount of royalties we pay out to artists, songwriters and rights holders continues to climb faster than ever. We have now paid more than $3 billion USD in royalties, including more than $300 million in the first three months of 2015 alone. That’s good for music, good for music fans … and good for music makers,” says the company.

    Some would disagree.

    Still, Spotify says that payouts will dramatically increase over the next year – given its uptick in paid subscribers.

    Spotify has also closed a new round of funding that will put $526 million into its pockets, according to the Wall Street Journal. This will surely help the company battle the newly-announced Apple Music.

    Apple Music may have already forced Spotify’s hand a bit.

    While subscriber growth – especially the paid kind – is wonderful for Spotify, it’s not all sunshine and roses. As Peter Kafka at Re/code points out, “the flip side of Spotify’s user growth is that its losses continue to increase. The company says that in 2014 it lost $197 million, up 289 percent from a $68 million loss in 2013. In the same period, Spotify’s revenue was up 45 percent, to $1.3 billion.”

    Image via Spotify, Facebook

  • Fitbit Files $100 Million IPO

    Fitbit Files $100 Million IPO

    Fitness tracking wearables company Fitbit has decided to go public

    According to Fortune, Fitbit will trade on the NYSE under the symbol FIT. The company says it plans to raise $100 million, but that number is likely to change.

    Fitbit’s regulatory filing revealed some interesting things about the company – including some impressive numbers in terms of revenues and profit.

    According to the filing, Fitbit hauled in over $745 million in revenues in 2014, up from $271 million the previous year. The company was profitable for the first time in 2014, generated nearly $132 million in net income. The previous year, that figure was a loss ($51.6 million).

    Fitbit also revealed just how many devices it has sold.

    In 2011, the company sold 200,000 devices. By 2012, that number was 1.3 million. Last year, Fitbit sold 10.9 million devices.

    “Our primary goal is to help our users improve their health and fitness. We believe our platform assists users in changing their daily behavior, such as eating healthier foods or going for a run or walking more to reach a goal or win a challenge. We empower our users to set their own health and fitness goals and track their progress towards these goals. We also offer premium services on a subscription basis that provide personalized insights and virtual coaching through customized fitness plans and interactive video-based exercise experiences on mobile devices and computers. Our premium services feature in-depth data analysis and personalized reports, as well as benchmarking against peers,” said Fitbit.

    And yes, if you were wondering, Fitbit’s filing takes a sideswipe at the Apple Watch.

    “By offering a broad range of products spanning styles and affordable price points and cross-platform compatibility, we empower a wide range of individuals with different fitness routines and goals that are difficult for other competitors to address. Moreover, our singular focus on building a connected health and fitness platform, coupled with a leading market share, has led to our brand becoming synonymous with the connected health and fitness category. This singular focus on health and fitness has driven us to dedicate significant resources to developing proprietary sensors, algorithms, and software to ensure that our products, which are specifically oriented towards health and fitness, have accurate measurements, insightful analytics, compact sizes, durability, and long battery lives. We believe this singular focus allows us to compete favorably with companies that have introduced or have announced plans to introduce devices with broad-based functionalities, including health and fitness tracking capabilities, which are not necessarily optimized for health and fitness usage.”

    Image via Fitbit, Facebook

  • Comcast’s Final Tally on Failed Time Warner Cable Deal: $336 Million

    Comcast spent $336 million to not acquire Time Warner Cable.

    In the company’s Q1 earnings report, it reported $99 in “transaction” costs. If you add that to all the other transaction costs Comcast reported in 2014 it looks something like this:

    “The costs are mainly for legal fees and outside consulting firms—everything from Human Resources and IT consulting to banks and management consulting services,” Comcast VP of Government Communications Sena Fitzmaurice told Ars Technica. “Communications and lobbying fees would be included—however, what is included has to be direct and incremental—so only those fees that are directly and incrementally associated with the deal.”

    The deal, which was first announced in February of 2014, officially died on April 24, 2015. Comcast announced it had abandoned its efforts to acquire Time Warner Cable, following reports that said the Department of Justice and Federal Communications Commission were both gearing up to recommend against the deal.

    If the merger had been approved, the Comcast-TWC behemoth would’ve controlled 57% of the US broadband market and 30% of the cable market.

    Just as he said in the announcement of the deal’s failure, Comcast CEO Brian Roberts said that they’re “moving on” in the earnings call.

    So, how much money is $336 million? A lot. How much is it to Comcast? Well, here’s a little perspective:

    Image via Steven Depolo, Flickr Creative Commons

  • Twitter Tops 300M Users as Earnings Fall Short

    Twitter Tops 300M Users as Earnings Fall Short

    Twitter has just reported its Q1 2015 earnings, and its stock price is taking a huge hit.

    The company reported $436 million in revenue, far short of the $456 million analysts projected. Despite falling short, it’s still a 74% year-over-year increase.

    “While we exceeded our EBITDA target for the first quarter, revenue growth fell slightly short of our expectations due to lower-than-expected contribution from some of our newer direct response products,” said Dick Costolo, CEO of Twitter. “It is still early days for these products, and we have a strong pipeline that we believe will drive increased value for direct response advertisers in the future. We remain confident in our strategy and in Twitter’s long-term opportunity, and our focus remains on creating sustainable shareholder value by executing against our three priorities: strengthening the core, reducing barriers to consumption and delivering new apps and services.”

    Twitter did top a big user milestone, however. The company reported 302 million monthly active users, up 18% year-over-year and up from 288 million the previous quarter. Still, that’s pretty slow MAU growth.

    Here are some more revenue specifics:

    Advertising revenue totaled $388 million, an increase of 72% year-over-year. Excluding the impact of year-over-year changes in foreign exchange rates, advertising revenue would have increased 78%; Mobile advertising revenue was 89% of total advertising revenue; Data licensing and other revenue totaled $48 million, an increase of 95% year-over-year; International revenue totaled $147 million, an increase of 109% year-over-year; International revenue was 34% of total revenue.

    Twitter is projecting second quarter revenues of $470 million to $485 million, which according to Bloomberg is well below analysts’ projections of $538 million.

    Twitter’s stock is crashing as of a result.

    The stock began to plunge before the markets closed as the company’s disappointing earnings report leaked early. It wasn’t a hack or anything, just someone at Twitter posting the earnings a bit prematurely. The company that spilled the beans just grabbed them from Twitter’s investor relations site:

    Twitter also announced it has acquired marketing company TellApart.

    For Twitter’s full earnings, head here.