Tech

Tesla’s China-based rival BYD took the #1 spot for total deliveries

Tesla is facing a less than desirable start to 2024, as it was surpassed in vehicles sold for the first time ever. Elon Musk’s company sold fewer EVs in a quarter than the Chinese electric car company BYD, which boasted the top spot for Q4 2023 in all-electric car sales.

BYD already gained an edge over Tesla on vehicle production last year, but delivery numbers are the more important metric, and BYD edged Tesla by almost 42,000 vehicles.

Tesla still managed to surpass expectations with a record quarter (and the 1.8 million EVs it sold in 2023 were the most worldwide for the entire year), but it’s now competing to get its top spot back for the first time in history.

Tesla’s Q4 results were a bit iffy

Notably absent from Tesla’s Q4 results were production and delivery numbers for the long-awaited Cybertruck. After years of delays, Tesla delivered its first few Cybertrucks in November, but Bloomberg noted that the company didn’t cite the truck’s delivery numbers, and instead grouped it together with its Model S and Model X vehicles.

BYD has come a long way

The battery manufacturer that turned automaker (which is backed by Warren Buffet) scaled rapidly, partly due to its ability to mass-produce its own batteries.

• BYD sold 526,000 all-electric vehicles in the last three months of 2023, compared to Tesla’s 484,500.

• The company also grew its EV sales by 73% in one year, delivering 1.57 million vehicles and selling almost as many hybrids, according to Nikkei.

Though 90% of BYD’s sales are in China, its international deliveries more than tripled in 2023. Plus, it’s threatening to pass auto titans Volkswagen and Renault on their home turf with plans for its first European EV plant in Hungary.

However, the road ahead won’t come without challenges… BYD may hit a roadblock, which is the likelihood that Europe will raise tariffs on Chinese EVs. The EU is also investigating China’s massive subsidies for its electric car makers, which it claims might be artificially lowering prices.

Jeff Bezos is looking to challenge Google’s search engine supremacy

For whatever reason, Bezos thinks he can challenge Google’s top spot in the search engine field. Despite looking at Google’s global market share in the category, Bezos and other big backers are betting on a new search engine to eclipse the top competitor.

Few companies in any industry rival Google’s global market share (which is around 92%), making it pretty hard to bet against them, but one company, Perplexity, is readying itself to take the top spot.

Now that it has an extra $74m in the bank, per The Wall Street Journal, having swayed prominent investors, including massive chip manufacturer Nvidia, Jeff Bezos, and former YouTube CEO Susan Wojcicki.

So, what makes Perplexity so intriguing?

The same answer as usual these days, AI. We’re used to search engines giving us a plethora of links we can scroll through to find the info we want, Perplexity cuts out the middleman, providing a direct, straightforward AI-backed response to every search you may have.

Perplexity considers itself an “answer engine” rather than a “search engine,” and its modernized approach, which went live late in 2022, has attracted a good portion of attention:

• It claimed 10 million monthly active users in 2023, with over 500 million searches.

• In its latest funding round, which followed a $25.6 million raise last spring, valued the company at $520 million.

While that may seem impressive, those numbers don’t even come close to touching the industry standard… Google processes around 8.5 billion searches every day, and its parent company, Alphabet, is worth $1.7 trillion, which gives them essentially unlimited funding (at least compared to Perplexity).

How do they plan to take the top spot?

As it tries to gain a small share in a market that has escaped more financed challengers like Microsoft and Yahoo, Perplexity has a rather big challenge to face:

• The startup isn’t currently profitable, and makes $5-$10 million in annual revenue.

• Perplexity must develop a product trustworthy enough to avoid user’s concerns about AI.

• It must hope Google’s own AI-powered features in development won’t make their own disposable.

All in all, Perplexity has a long road ahead of them, and the challenge presented will not be an easy one to topple. But, with large backers and a unique outlook on the search engine space, they might just be able to compete… eventually.

2023 wasn’t good for startups… will 2024 be?

Last year was not kind to startups, will this year be any better to them? Tens of billions of dollars worth of investor raised funding in thousands of startups went down the gutter in 2023, which isn’t a promising look for this year.

Who all went bankrupt? WeWork, once worth $47 billion, filed for bankruptcy. Convoy, the Bezos-backed trucking company valued at $3.8 billion, shut down. Health startup Olive AI closed its doors after peaking at a $4 billion valuation.

And many other startups followed in their footsteps by selling for a fraction of their valuations or closing all together:

• Hopin, the virtual-events startup once valued at $7.8 billion, sold its core business for $50 million.

• Once valued at $2.5 billion, scooter startup Bird filed for bankruptcy last month (they were so fun to ride).

• Fintech startup Plastiq, which raised $226 million in funding, went bankrupt in May.

Almost 3.2 thousand private venture-backed startups went under in 2023 after raising a combined $27.2 billion in funding, according to data compiled by PitchBook for The New York Times.

Investors beware

All the startups crashing and burning has made venture capitalists more selective, putting a kibosh on most of the money that used to fly out of their wallets.

• Between 2012 and 2022, the funding in private US startups multiplied eightfold, hitting $344 billion.

• In the last year, investments in US tech startups declined 49%.

This makes it even harder for startups to survive, meaning we might see even more closures in 2024. And when a startup fails, it’s not just the investors who get burned.

Startup founders have long struggled (often quietly) with their mental health. Investors predict this funding shortage will only make the issue worse.

But, there is good news…

Corporate giants like Uber and Slack were founded right after the 2008 recession; some experts say tough economic times can actually be good for business. And with over 262 thousand tech workers laid off last year, there will likely be an influx of talented tech connesouiers looking for opportunities.

Plus, there are plenty of other reasons it could be a good year for startups, per TechCrunch:

• Interest rates are expected to fall, which could boost valuations and help get VC funding up.

• Software is the most common startup product, and more companies will look to spend on similar tech.

Big IPOs are getting closer to debuting (like Reddit and Shein). And, as always, there’s AI, which could help businesses be more efficient and profitable in the coming years. So, if you’re looking to push an IPO soon, don’t get too discouraged.

Miscellaneous

The FDA approved the first state in the US to get its meds from Canada

If they don’t make them here, then we might as well get them elsewhere. On Sunday, the Food and Drug Administration (FDA) approved Florida’s request to import cheaper medication from Canada.

Florida is the first state to get permission from the agency to bring in meds from Canada under a law Congress passed two decades ago to help Americans pay less for drugs.

Florida officials say ordering cheaper drugs for conditions like HIV and diabetes from Canadian wholesalers will save Medicaid and other state programs $150 million over the first year it’s implemented.

Will this spread across the country?

The FDA’s authorization of Florida’s request sets a precedent that foreign suppliers can safely fill Americans’ pill bottles and clears an alley for other states to get similar approvals.

• Eight states besides Florida have laws that will allow them to import drugs if the FDA signs off on it.

• Some, like Colorado, have already applied for approval, per The New York Times.

• To get a signoff, a state has to prove that importing the medications would actually lower consumer prices and that the drugs adhere to the FDA’s safety standards.

Experts say the high drug costs in the US are ultimately driven by the patent protections that allow pharma companies to maintain a long-lasting monopoly on drug production.

Other commentators point out that Canada’s pharma market is too small to meet all Americans needs. The country is already making plans to restrict exports of drugs that are of low supply.

It’s far from a done deal… Pharma lobbyists will likely challenge the FDA’s Florida decision in court, and some producers already bar Canadian companies from selling their products across the border.

The owner of the Carolina Panthers is getting calls for his resignation

Now that the NFL regular season is over, Carolina Panther fans have had enough (especially considering their owner’s recent behavior). After six straight losing seasons with billionaire owner David Tepper at the head, and a 2-15 record this year, Panther fans are fed up.

Tepper isn’t used to losing. His hedge fund, Appaloosa Management, made $2 billion by buying tech stocks including Nvidia, Microsoft, and Uber last year, according to Bloomberg. Though the Panthers have been doing very poorly, they’ve thrived as a money maker. Sportico estimates the franchise is worth almost twice as much now as it was when Tepper bought it for $2.3 billion in 2018.

Now that’s just unsportsmanlike

While Tepper is winning off the field, on the field is a different story. Thousands of people have signed a petition calling for the hedge fund manager to sell the team.

It was created after Tepper threw a drink at a Jaguars fan last Sunday (very professional), which earned him a nice $300,000 league fine. In total, the fine accounts for less than 1% of 1% of his (approximate) $21 billion net worth, according to ESPN, which has enraged some fans even more.

Sports teams are increasingly lucrative

Billionaires and private equity firms are growingly turning to sports franchises as a quickly appreciating asset group. For example, hedge fund Point72’s founder Steve Cohen bought the New York Mets baseball team in 2020 (though the early returns on his ownership are iffy). Now, Citadel founder Ken Griffin is reportedly considering buying part of the Miami Dolphins.

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Grab Bag

AMC’s stock hit its lowest point ever

Looks like the final bastion of meme stocks is plunging for good. The movie theater chain’s stock, once the talk of r/WallStreetBets, hit its lowest point ever yesterday ($5.14 as of writing) after a five-day losing streak.

The former uber-hyped meme stock is now just a husk of its former self. In 2021, at the height of the meme stock craze, AMC’s stock jumped to $339.05 a share. But it’s been going downhill for a while now. As of 2023, and moving into 2024, AMC isn’t looking too hot:

• The company needs to pay off its debt (as well as avoid bankruptcy), AMC completed a 10:1 reverse stock split in August, meaning they consolidated every ten shares that investors already had into one, and converted its “APE” preferred shares into regular AMC stock.

• Since those moves, its stock price has plummeted more than 80%. Safe to say short sellers have reaped the benefits.

While there were some highs this year, with giant blockbusters like Barbenheimer and Taylor Swift’s concert movie pushing box-office revenue past $9 billion, it still was only a temporary boost for the movie chain.

While doom is looming over the company, AMC CEO Adam Aron said the company is “still innovating” and already proved the haters wrong by surviving last year. Hopefully, he’s right.

The Stanley cup is causing chaos

And no, it's not the NHL’s prestigious championship trophy I’m talking about. Stanley released its limited edition Valentine’s day cups at Target on Dec. 31st, and they’re causing quite a commotion.

The viral water bottle tumblers are having shoppers (literally) stampede into Target and race each other to get them. Videos on TikTok show people camping outside the store to purchase the coveted tumblers.

The $20–$45 travel cups quickly sold out, Target told CNN (within minutes at some locations) and many are being resold on eBay and Mercari for more than $100 each.

What’s the big deal?

The 40-ounce Stanley “Quencher”, an insulated tumbler that fits in a cup holder (which actually sounds kinda nice), appears to be the new hot product among Gen-Z, especially women.

• On TikTok, there are 6.7 billion views on videos tagged #stanleycup (with almost none of them being about hockey).

The comically enormous Quencher has gotten so popular that it’s largely responsible for Stanley’s revenue jumping from $74 million in 2019 to $750 million in 2023, according to CNBC.

How did they get this popular? Well, they can thank its new president, Terence Reilly, who was appointed at the head of the company in 2020.

He was the marketing guy who made Crocs a household name again, and boosted Stanley into the position they’re in now by leveraging social media influencers and introducing a new line of colors, which have clearly attracted the eyes of young people. Talk about a good hire.

Fast Facts

Geo-guesser: This quiz can guess where in the US you’re from based on how you talk.

Dumb Dog: A seven-year-old goldendoodle named Cecil ate up $4,000 in cash his owners set on a counter in their Pittsburgh home.

Rifle Resignation: Wayne LaPierre, who has led the National Rifle Association since 1991, said Friday he will resign at the end of this month.

Check this out: Are flying cars finally here?

Custom Cup: Starbucks will now let customers use their own cups for drive-through and app orders as the coffee chain looks to cut back on waste.

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