Techonomics — IBM’s Weekly Newsletter
April 6, 2018
Market Activity and Trends
Spotify’s IPO Breaks Traditional Mold | Engadget | April 4, 2018 |
Traditionally, a company’s Initial Public Offering (IPO), involves armies of Wall Street underwriters, traders, and bankers. The banks advertise the IPO, find buyers, and predict pricing for the company. But Spotify, the popular music streaming startup, had a different idea.
The company decided to have an IPO to create a fair market price for current investors in the company. Spotify wasn’t interested in fundraising, just creating a market value so their investors could see a return. Spotify did not work with any banks or do any underwriting. Instead, they let the trades and pricing happen as they may.
Trading opened at $165.90 and closed at $149.01. This closing price is a 28% increase from the share reference price of $132, making a triumphant debut for Spotify.
Ransom Hacking Increasingly a Threat | NBC News | April 3, 2018 |
Last week, hackers were able to take down Baltimore’s 911 response network. Unfortunately, this is not an isolated incident. In the past 24 months, there has been a grand total of 184 attacks on public agencies that keep the US safe. These attacks are frequently motivated by ransom, with the hackers demanding a sum of money to stop the attack.
Experts think attacks like these could happen anywhere, making any company or organization with any online operations capacity a target. New security technology will be paramount in stopping these hacking attacks.
Startup InstaCart Continues to Fundraise | Bloomberg | April 5, 2018 |
In InstaCart’s second round of funding this year, the grocery shopping startup raised an additional $150 million. InstaCart’s mission to create a seamless, convenient, and digital grocery shopping experience is not unique, however. It is a market dominated by incumbent tech giants like Amazon and Wal-Mart.
This brings InstaCart’s total valuation to $4.35 billion.
The Banking Technology Race | Bloomberg | April 5, 2018 |
For years, banks lagged behind in applying technology to improve their trades and processes. However, as competition heated up, it became an imperative. As more and more clients came to expect their business services to act like their seamless and digital customer experiences, banks implemented technology to get the fastest trade at the best price.
One great success among the banks is Goldman Sachs’s. The bank has a technology division that created a system that nearly instantaneously finds the best trade, verifies it, and executes it before a human can blink an eye — in 50 milliseconds to be precise. As more banks try to make similar systems, it’s clear technology will transform banking.
Cryptocurrency Trading Platform Coinbase Moves Into VC Sphere| TechCrunch | April 6, 2018 |
Coinbase Ventures is the name of the new VC fund which will focus exclusively on Cryptocurrency startups. It’s a new division at the popular Cryptocurrency trading platform Coinbase. The new VC’s goal is to help especially promising startups gain traction and enter the market smoothly.
Emilie Choi, the head of Corporate and Business Development for Coinbase, wrote “it’s in everyone’s interest to see the ecosystem innovate”, and this VC would help that goal. Other executives in the company hope that providing VC structure will address the market volatility of cryptocurrencies. This will be especially helpful since the Cryptomarket is under SEC scrutiny.
