๐จ HOTEL COMPANY #AirBnB ๐ doesnโt own real estate
๐ TAXI COMPANY #Uber ๐ doesnโt own any cars
AND
๐ฎ DIGITAL PLAYGROUND COMPANY #Roblox ๐ doesnโt create any games
With $GME hitting all time highs, making people millions & some even billions, let's take a look at one of the gaming companies set to IPO soon.
Time for a thread ๐ ๐๐
๐จ HOTEL COMPANY #AirBnB ๐ doesnโt own real estate
๐ TAXI COMPANY #Uber ๐ doesnโt own any cars
AND
๐ฎ DIGITAL PLAYGROUND COMPANY #Roblox ๐ doesnโt create any games
Remember building imaginary forts with your friends in your backyard?
It's like that except digital, pros are building the structures and your parents are spending a lot of $$$ buying gear, digital pets and accessories.
Making $RBLX very rich!
Online gaming platform where millions of kids (and some adults) come to play, learn, communicate, explore, and expand their friendships.
All in 3D digital worlds that are entirely user-built.
- Founded in 2004
- $589MM revenue
- +170MM monthly active users (Oct 2020)
- Freemium, monthly subscription & one-time payments
- US$29.5B Valuation
No doubt COVID was big for $RBLX; with kids stuck at home they clocked some serious hours.
Revenue was up +68% year-over-year to +$588MM (9 months ended Sept 2020).
But, even pre-covid, the trend was their friend as NEW users flocked to the platform!
And they are completely addicted. Compare $RBLX to the other MAJOR platforms that compete for our attention and itโs absolutely jaw dropping!
Thatโs because theyโve nailed the โHoly Grailโ of the platform economy: getting customers addicted!
Attract CUSTOMERS โ๏ธ which attracts DEVELOPERS who create great content โ๏ธ Attracting More CUSTOMERS
To keep content quality high, their customers coming back and the flywheel spinning, they share a decent amount of their revenue with their developers: +$250MM in 2020.
This has attracted an astonishing +7MM developers!
BUT, this is only a 25% payout of revenue to developers. If you compare it to other marketplaces its not a lot:
70%: Apple App Store
75-85%: Amazon (similar to Walmart)
95%: Etsy
Sustaining such a high โtake-rateโ is insanely impressive for $RBLX
Is the 'in-gameโ currency that powers the ecosystem. It costs real fiat to buy. Customers use it to BUY:
- Games
- Virtual Items
- Animations & Unique Abilities
Fanatic customers are even saying "Robux will replace the USD" ; )
Do they actually make money?
Technically, on paper, NO.
Net loss of $203.2MM in the 9 months ended September 30, 2020.
BUT...
If you look at their FCF its skyrocketing: $292MM up from a mere $5.9MM the year before.
CA$HING!
You can see it in their bookings, which grew +170% YoY.
So why a net loss with such high FCF?
Because although the money is โin the doorโ, they recognize it over 23 months (estimated average lifetime of a paying user)
You can see the cash piling up over on their balance sheet:
-NO DEBT ($50MM undrawn line)
- +$800MM cash (at Sept 2020)
Plus, on Jan 7th they raised another US$520MM in a pre-IPO financing.
While 99% of the public will say Roblox's biggest public "competitor" is Unity Software (U-US, $39B). I argue that is a false narrative beyond investors bucketing them as "gaming" companies.
But $U has done very well. Up +300% since its #IPO in September.
The 2 more appropriate competitors are both private and booth owned by major companies:
- Minecraft 130MM active users
- Fortnite 350MM active users
Roblox is giving them a real run for their money with +170MM active users as of October 2020.
I see 4 key growth drivers that could yielding hundreds of millions of dollars:
1.Advertising
2.Cross-Over JVs
3.Subscriptions
https://t.co/K9t7BjumyG Expansion
Want more on $RBLX ?
- Growth
- Risks
- Valuation
- Should you buy on the IPO?
Read the rest here in my (FREE) weekly newsletter ๐ ๐๐
https://t.co/h7qeybRf2R
#Gaming #Stocks #NASDAQ
More from Trading
Many of you have seen the famous Westrum Organizational Typology model, so prominently featured in State of DevOps Research, Accelerate, DevOps Handbook, etc.
This model was created Dr. Ron Westrum, a widely-cited sociologist who studied the impact of culture on safety
Thanks to Dr. @nicolefv, I was able to interview him for an upcoming episode of the Idealcast! ๐คฏ
It was a very heady experience, and while preparing to interview him, I was startled to discover how much work he's done in healthcare, aviation, spaceflight, but also innovation.
I've read 4+ of his papers, so I thought I was familiar with his work. (Here's one paper: https://t.co/7X00O67VgS)
I was startled to learn he has also studied in depth what enables innovation. He wrote a wonderful book "Sidewinder: Creative Missile Development at China Lake"
Dr. Westrum writes about China Lake Research Labs: "its design and structure had one purpose: to foster technical creativity. It did; China Lake operated far outside the normal envelope... Sidewinder & others were "impossible" accomplishments,
I love this book because it describes traits of organizations that routinely create and maintain greatness: US space program (Mercury, Gemini, Apollo), US Naval Reactors, Toyota, Team of Teams, Tesla, the tech giants (Amazon, Google, Netflix, Google)
This model was created Dr. Ron Westrum, a widely-cited sociologist who studied the impact of culture on safety
Thanks to Dr. @nicolefv, I was able to interview him for an upcoming episode of the Idealcast! ๐คฏ
It was a very heady experience, and while preparing to interview him, I was startled to discover how much work he's done in healthcare, aviation, spaceflight, but also innovation.
I've read 4+ of his papers, so I thought I was familiar with his work. (Here's one paper: https://t.co/7X00O67VgS)
I was startled to learn he has also studied in depth what enables innovation. He wrote a wonderful book "Sidewinder: Creative Missile Development at China Lake"
Dr. Westrum writes about China Lake Research Labs: "its design and structure had one purpose: to foster technical creativity. It did; China Lake operated far outside the normal envelope... Sidewinder & others were "impossible" accomplishments,
I love this book because it describes traits of organizations that routinely create and maintain greatness: US space program (Mercury, Gemini, Apollo), US Naval Reactors, Toyota, Team of Teams, Tesla, the tech giants (Amazon, Google, Netflix, Google)
๐ก๐ถ๐ณ๐๐-๐๐ฎ๐ป๐ธ๐ป๐ถ๐ณ๐๐ ๐ข๐ฝ๐๐ถ๐ผ๐ป ๐๐๐๐ถ๐ป๐ด ๐ฆ๐๐ฟ๐ฎ๐๐ฒ๐ด๐
Complete Backtest and Indicator link
๐งต A Thread ๐งต
๐ฆ๐ฒ๐๐๐ฝ:
๐ธ Monthly Option Buying
๐ธ 50 ema on 3 min timeframe
๐ธ Supertrend 10 , 3
๐ธ Chart : Banknifty , Nifty Futures as we backtested on futures
๐ธ Entry 9:20 to 3:00
๐ธ Max 3 Entries per day
๐ธ Premium nearest to 200 Rs only
[2/18]
Why Monthly Option buying ?
๐ธ Less theta decay compared to weekly options
๐ธ Less Volatility
๐ธ Supertrend and MA Settings
[3/18]
๐ธ Indicator Link
๐ธ Click on the below ๐ญ๐ช๐ฏ๐ฌ -> ๐๐ฅ๐ฅ ๐ต๐ฐ ๐๐ข๐ท๐ฐ๐ถ๐ณ๐ช๐ต๐ฆ๐ด -> ๐๐ฅ๐ฅ ๐ฐ๐ฏ ๐๐ฉ๐ข๐ณ๐ต from favourites and start using it !
๐ธ https://t.co/zVXavqLBto
[4/18]
๐๐ป๐ฑ๐ถ๐ฐ๐ฎ๐๐ผ๐ฟ ๐ฆ๐ฒ๐๐๐ถ๐ป๐ด๐ :
๐ธ Max 6 Trades per day ( Both CE and PE buy)
๐ธ Timings 9:20 am to 3:00 pm
๐ธ Supertrend : 10,3
๐ธ Moving Average 50 ema
[5/18]
Complete Backtest and Indicator link
๐งต A Thread ๐งต
๐ฆ๐ฒ๐๐๐ฝ:
๐ธ Monthly Option Buying
๐ธ 50 ema on 3 min timeframe
๐ธ Supertrend 10 , 3
๐ธ Chart : Banknifty , Nifty Futures as we backtested on futures
๐ธ Entry 9:20 to 3:00
๐ธ Max 3 Entries per day
๐ธ Premium nearest to 200 Rs only
[2/18]
Why Monthly Option buying ?
๐ธ Less theta decay compared to weekly options
๐ธ Less Volatility
๐ธ Supertrend and MA Settings
[3/18]
๐ธ Indicator Link
๐ธ Click on the below ๐ญ๐ช๐ฏ๐ฌ -> ๐๐ฅ๐ฅ ๐ต๐ฐ ๐๐ข๐ท๐ฐ๐ถ๐ณ๐ช๐ต๐ฆ๐ด -> ๐๐ฅ๐ฅ ๐ฐ๐ฏ ๐๐ฉ๐ข๐ณ๐ต from favourites and start using it !
๐ธ https://t.co/zVXavqLBto
[4/18]
๐๐ป๐ฑ๐ถ๐ฐ๐ฎ๐๐ผ๐ฟ ๐ฆ๐ฒ๐๐๐ถ๐ป๐ด๐ :
๐ธ Max 6 Trades per day ( Both CE and PE buy)
๐ธ Timings 9:20 am to 3:00 pm
๐ธ Supertrend : 10,3
๐ธ Moving Average 50 ema
[5/18]
