Benzinga does not provide investment advice. 2023 Benzinga.com. Will His AI Plans Be Any Different? Menlo Park, CA 94025 (650) 549-9145 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies: . They are people with families and kids to support. This is a hard game. Australian Gold & Copper Ltd. - MarketWatch As you know we entered the year with a big bond short, we've now covered that bond short because we don't think that it's possible for the Fed to raise rates 7,10, 12 times as some people think this year. Your P/E ratio has fallen from 23x to 12x and now trades at less than half the average P/E of your peers. The average tech IPOs down almost 50% from last year, SPACs much worse, direct list bad, all stocks that were taken public last year now it's clear were overvalued relative to where the world is trading them today. This is a region of 700 million plus people. But as you know, in the first three months of this year, all the high-quality stocks are being destroyed as well. Instead, the company has announced investments of $1015B per year into a metaverse project that largely includes AR / VR / immersive 3D / Horizon World and that it may take 10 years to yield results. Protocol: Kultura Capital Management is being structured as a hybrid fund that will focus on late-stage tech startups as well as public companies, the person said. And so we add on a fair amount of exposures we entered this year. An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards. ISDA fosters safe and efficient derivatives markets to facilitate effective risk management for all users of derivative products. Hedge Fund - Altimeter Capital Management - Insider Monkey With that said, we have a shortage of talent in Silicon Valley. The full text of the stockholder letter to the United Board follows: March 8, 2016. Days Trial WAPNER: I hear you. Brad Gerstner Wiki: Facts about the CEO OF Altimeter Capital And I think they have to execute against the underlying operations in the business. We'll see you soon. Data is a real-time snapshot *Data is delayed at least 15 minutes. At the same time that Meta ramped up spend, you lost the confidence of investors. 2023 CNBC LLC. ISDA fosters safe and efficient derivatives markets to facilitate H1 Raises $100M Series C to Expand Footprint, Make H1 the FalconX Raises $210M Following 30x YoY Revenue Growth; Now Valued at $3.75 Billion Series C Led by Altimeter Capital, B Capital Group, Sapphire Ventures, and Tiger Global Management, with. Altimeter manages a long / short public equity fund and private growth equity funds. A securities lawyer, Brad Gerstner graduated from HBS in 2000 and joined General Catalyst. And as a result, you know, last year we held up better than most because we own high-quality stocks, and we were short lower quality stocks. BRAD GERSTNER: Hey, Scott, thanks for having me. Social networking is the use of internet-based social media platforms to make connections and share various media with friends, family, colleagues, or customers. Nov. 16, 2021 at 2:38 p.m. I'm not a seller. The conventional wisdom press and investor is that the core business hit a wall last fall. We believe in this team. Altimeter Capital Management LP Top Holdings 13F Filings With the gains posted on March 3, Meta Platforms shares are up 54% this year. Frankly, if I was Sea Limited, if I was Uber, I might be looking at consolidating the business. I don't think the Fed is going to throw away two years' worth of work to try to avoid a recession in a election year and run us straight into the teeth of a recession while we're trying to fight a war in Europe. Chicago, IL 60606 It's interesting that now today you say we're in the neighborhood of a tradable bottom. A letter addressed to Zuckerberg and the board of directors was published on Oct. 24. Search ISDA ISDA fosters safe and efficient derivatives markets to facilitate effective risk . Global Business and Financial News, Stock Quotes, and Market Data and Analysis. We certainly our base case, as you know, was a soft landing four to five rate hikes into this year. The stock is 51% off of its high. Two years from now, people are going to be looking back and say, why the hell didn't you buy Snowflake at 160 bucks a share? Altimeter said such huge investments "in an unknown future is super-sized and terrifying, even by Silicon Valley standards". Altimeter Capital partner Kevin Wang led the firm's investment in cloud data platform Snowflake in 2015 in its $45 million Series C round; he sat on its board until 2020. If you really think about what the metaverse is in the first instance, it's a better version of what you and I are doing right here. Meta Slashes Prices for VR Headsets Brad Gerstner's Altimeter Capital has an $8B profit on Snowflake. A new Board of Directors Industry Trends on 4000+ Stocks, Pro Investing by Aditya Birla Sun Life Mutual Fund, Canara Robeco Equity Hybrid Fund Direct-Growth, Cut workforce, spending on metaverse, key investor tells Mark Zuckerberg. GERSTNER: Right Scott so that you know I started off by saying you know we've been beaten up this year like everybody else because I was covering shorts as we approach the five-year average. We dont have any demands. Your P/E ratio has fallen from 23x to 12x and now trades at less than half the average P/E of your peers. With all of that said, we believe the company can responsibly and reasonably reign in capex while continuing to invest aggressively in AI and other critical areas. Those decisions include slashing expenditure and reducing headcount, the CEO of Altimeter Capital told Meta founder Mark Zuckerberg in an open letter. There is no doubt that doubling annual FCF will improve share price. Comprender el funcionamiento social, poltico, econmico, cultural y natural de la sociedad a fin de reflexionar, hacer propuestas y asumir compromiso en torno a las polticas de desarrollo nacional, local y regional en el mbito del respeto de los derechos humanos, la integracin econmica y la convivencia social, bajo una concepcin de desarrollo humano sostenible. I think they have to take a look at their capital allocation plan. ", Twitter. But you also (sometimes) capitalize the first word of a quote. Meta shares moved 6% higher following the announcement. Privacy Policy, ISDA uses cookies to enhance your experience on our website. 3. And notably, this decline in share price mirrors the lost confidence in the company, not just the bad mood of the market. The Singaporean rideshare giant Grab is set to merge with the SPAC Altimeter Growth 1, according to a report from The Financial Times. Facebook parent Meta Platforms (META) announced that it would reduce selling prices for its Quest virtual reality (VR) headsets. PLAN, Access the exclusive Economic Times stories, Editorial and Expert opinion, 90 Days Prime access worth Rs999 unlocked for you, Exclusive Economic Times Stories, Editorials & Expert opinion across 20+ sectors, Stock analysis. If the company were investing $12B per year into this project, then that confusion might not even be a problem. Is it close to being done? We understand that the Protocol is designed to amend only those Protocol Covered Agreements between two Adhering Parties that were previously amended pursuant to the terms of the August 2012 Protocol, the March 2013 Protocol or both. AGCUU went public at $10 on Oct. 1, and closed Tuesday at $11.80. About Altimeter Capital Altimeter is a leading technology focused investment firm based in Silicon Valley with over $15 billion in assets from endowments, foundations, and family offices. Round: Series D Description: Ro is a telehealth startup that operates digital health clinics for men's and women's health, along with smoking cessation. As you know, we are long-term shareholders. Brad Gerstner founded the. Login Choose your reason below and click on the Report button. As you know, we have attempted to work collaboratively with the current Board to meaningfully improve governance, Board composition, and oversight. Activist investor Brad Gerstner, founder and CEO of tech-focusedhedge fundAltimeter Capital, sent anopen letterto CEOMark Zuckerbergin October calling for a pullback in metaverse spending. Why 20%? Tech SPAC Altimeter Growth Corp. 2 prices further upsized $400 million With all of that said, we believe the company can responsibly and reasonably reign in capex while continuing to invest aggressively in AI and other critical areas. Can you tell me where that stands now and how you view stocks like that that have gotten absolutely obliterated? I think that this is a business that is investing in the right things. Meta Platforms, which is set to report third-quarter results on Wednesday after markets close, declined to comment. United Stockholders Altimeter Capital and PAR Capital Express In fact, in the most recent quarter, they added 1.4 billion of contracted value. WAPNER: So let me talk about your overall exposure if I if I could because by last December, you had said you had taken most of your your shorts off and your long exposure was back up to 70%. Moreover, Meta has industry leading capabilities in key future technologies like artificial intelligence and immersive 3d that will help drive new products and future growth. And we are confident that your long-term investments in AI and the next generation of communications will continue to drive us all forward. I hear you but look, there are, there are some people who think and it's not maybe it's not a Snowflake, but it's a you know, a basket of these kinds of names that may never get back. Altimeter Capital. To put that in perspective, it merely takes the company back to mid-2021 levels of employee expense and I dont think anybody would argue that Meta wasnt sufficiently staffed in 2021 to tackle a business that looks similar to how it looks today. If they do it, I think the stock can be up over 50% between now and the end of the year. CAPEX Investing Aggressively and Responsibly in the Future of AI. Conclusion A Leaner, Faster, More Successful Meta. Data is a real-time snapshot *Data is delayed at least 15 minutes. What is the metaverse and why are billions of dollars being spent on it? August 2012 Protocol ALID: 66703 But the fact of the matter is the entire market has evaporated around these types of stocks. I mean, two years ago we were we were having this conversation. Warren Buffett's: Berkshire Hathaway. Do they want to stand with me and ride that out? This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes. It lost $5.8 billion in the first six months of the year. Kevin Wang - Forbes Samooha, a startup developing a "cross-cloud" data collaboration platform, today announced that it raised $12.5 million in a funding tranche backed by Altimeter Capital and Snowflake Ventures . We believe that our conclusion is shared by many of United's long-suffering stockholders, customers, and 80,000+ dedicated employees. Even excluding its large metaverse investment, Meta has gone from $15B in annual capex in 2018, 2019, and 2020 to $30B in annual capex in 2022. To put that in perspective, excluding your large metaverse investment, Meta is investing more in capex than Apple, Tesla, Twitter, Snap, and Uber combined! Today, the cost of capital has radically changed, and so has Metas growth rate. FalconX Raises $210M Following 30x YoY Revenue Growth; Now Valued at $3 Altimeter Capital Management, LP ("Altimeter") is an SEC-registered investment adviser. Are you as optimistic today as you were in months past? And now we've shot right through the five-year average. WAPNER: Man, I love how honest you are and I know our viewers do as well. See here for a complete list of exchanges and delays. Altimeter Capital Management, LP Buys Opendoor Technologies Inc, Toast Inc, Duolingo Inc, Sells . CNBC Exclusive: CNBC Transcript: Altimeter Capital Founder & CEO Brad Gerstner Speaks with CNBC's Scott Wapner on "Closing Bell: Overtime" Today Published Mon, Mar 14 20225:56 PM EDT Share. WAPNER: Speaking of going higher up, you see what interest rates are doing today after sitting in a tight spot, they've started to move to 11. But it's good to be here and and you know, while I think we we did see the normalization and multiples as a likely outcome toward the end of last year. Welcome to "Overtime.". About Altimeter Capital Accept. After all, why not hire more people and invest in more things when the cost of capital was near zero and growth seemed unlimited? If the company were investing $12B per year into this project, then that confusion might not even be a problem. Meta Platforms CEO Mark Zuckerberg speaks about the Facebook News feature at the Paley Center For Media in New York on Oct. 25, 2019. It's 3 trillion, right? Altimeter Capital Management, LLC. GERSTNER: Scott, thanks for having me. Think about this, Scott. He said the money the company is currently spending to develop VR could add up for a decade before it comes to fruition. Updated on September 30, 2022. Its competitor or not its competitor, its closest comp in Southeast Asia Sea Limited is also down over 70%. Right if the Fed raises rates 10 or 12 times given the demand destruction and the slowdown already underway in this country, we will be in a big recession come fall. FTX founder Sam Bankman-Fried was not only a tireless fundraiser from venture capital firms including Paradigm and Sequoia Capital, but also quietly made investments in those same funds, according to two people familiar with the matter. Can it possibly be worth a trillion? Tina Sharkey, CEO of SherpaFoundry; former board member of HomeAway; and That stuff was being advertised on Instagram. Some companies require tremendous capex investment to maintain their existing business. It was being purchased on the Shopify platform and people were using PayPal to check out. Meta shareholder wants Facebook parent to cut jobs, spending 3,30,700 crore) if it cut headcount by at least 20 percent, trimmed capital expenditure by at least $5 billion (roughly Rs. Hedge Fund Manager. Let me tell you the bear case on Facebook, okay, the bear case on Facebook and other ad models like Google is that we're running headlong into a massive recession. We have no stimulus checks. By any normal company or start up standard, $5 B per year would seem like an extraordinary amount. Where's your exposure today? Altimeter said annual free cash flow can be doubled to $40 billion if it cut headcount by at least 20%, trimmed capital expenditure by at least $5 billion to $25 billion a year and capped annual investment in the metaverse to $5 billion instead of the current $10 billion. We want to hear from you. I think if you said why might these numbers have to come down if we're heading into a recession, the numbers are likely to come down. Samooha launches with tech that lets companies securely share data FTX, once the third-largest centralized cryptocurrency exchange, is now in U.S. bankruptcy. Altimeter Capital's Brad Gerstner Issues Open Letter to Meta (META) and And frankly, they weren't a very good hedge because bonds haven't moved all that much but gross stocks are down 60, 70, as you mentioned, down over 80%. ISDA is a registered trademark of the International Swaps and Derivatives Association, Inc. Following is the unofficial transcript of a CNBC exclusive interview with Altimeter Capital Founder & CEO Brad Gerstner on CNBC's "Closing Bell: Overtime" (M-F, 4PM-5PM ET) today, Monday, March 14th for the premiere. With SNOW currently trading at $242, that stake is now worth $8.8 billion. Ranked #76 out of 483 Hedge Fund Managers. click here! Crowdfunding is the use of small amounts of capital from a large number of people to raise money or fund a business. Altimeter is based in California and has about $16 billion in . March 2013 Protocol ALID: 66704. Meta shareholder Altimeter urges Facebook parent to cut down jobs, expenses Indias general insurers are looking to set up a larger marine insurance pool to cover the risks of transporting crude oil, edible oil, project machinery and fertiliser from the war-torn Russia-Ukraine region. When exactly did you determine that the Board was so inadequate as to need four new directors, all at once, and without an annual meeting or a stockholder vote? Investopedia requires writers to use primary sources to support their work. ISDA 2021 SBS Top-Up Protocol, Adhering Organization: It's a better version of Messenger. Altimeter and PAR believe these experienced professionals can bring meaningful experience, objective oversight, and powerful change to United. My bet is we're gonna have less this year. This compensation may impact how and where listings appear. It just launched in 150 countries, has over a billion views. So take Snowflake as an example. A ltimeter Growth Corp. 2, the second blank check company formed by Altimeter Capital targeting the tech sector, filed on Thursday with the SEC to raise up to $200 million in an initial public. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. effective risk management for all users of derivative products. This will alert our moderators to take action. Perhaps it was the re-naming of the company to Meta that caused the world to conclude that you were spending 100% of your time on Reality Labs instead of AI or the core business. Altimeter Capital Management partner Chris Conforti plans to leave the investment firm, according to people with knowledge of the matter. Neither Altimeter, nor any of its affiliates or personnel, offers investment advisory services via the internet. Time to Get Fit an Open Letter from Altimeter to Mark Zuckerberg (and I think the only debate is what is the multiple going to be in three months, in six months, in nine months. Now that's what's going on in the business so all those people writing rest in peace epitaphs for Facebook are going to have to deal with that acceleration. I think you're gonna see monetization gains against IDFA and either way we lap that issue in Q3 and Q4. Altimeter.com is Altimeter's only website. Sign up for free newsletters and get more CNBC delivered to your inbox. . The bet . I would take it a step further and argue that these incredible companies would run even better and more efficiently without the layers and lethargy that comes with this extreme rate of employee expansion. We didn't see the concerns emerging about hyperinflation about 10 to 12 rate hikes, and we certainly didn't see this tragic more unfolding on the doorstep of Europe. "Meta Reports Fourth Quarter and Full Year 2022 Results," Page 10. How big are the margins, ultimately Snowflake will be worth a lot more because there is almost endless demand for the product and this is a business that is highly profitable. Every company I talked to is tightening its belts. Cookies collect information about your preferences and your devices and are used to make the site work as you expect it to, to understand how you interact with the site, and to show advertisements that are targeted to your interests. International Swaps and Derivatives Association. Altimeter Capital Management LP. You would simply do R&D quietly and investors would focus on the core business and the breakthroughs in AI. In a single quarter, they added 1.4 billion. At first glance, the rules of English capitalization seem simple. Following is a link to video on CNBC.com: https://www.cnbc.com/video/2022/03/14/we-could-go-lower-before-we-go-higher-in-stocks-says-altimeter-capitalas-ceo-brad-gerstner.html. Altimeter SPAC Taking Grab Public | PYMNTS.com Of course, a company that connects nearly three billion users on phone and text must be investing in the next generation of communication. Got a confidential news tip? All of China internet down over 80%. The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. Get this delivered to your inbox, and more info about our products and services. Altimeter Capital Management, LLC a Portfolio Activity as reported in the most recent 13F form published on Dec 31, 2022. It's down 32% in the last 11 months ,that ranks it in the top three of the last 20 years in terms of drawdowns. It's been a half century since Australia and China established formal relations, but neither side is really celebrating. Why didn't you buy, you know, Uber at 28 bucks a share? Even excluding its large metaverse investment, Meta has gone from $15B in annual capex in 2018, 2019, and 2020 to $30B in annual capex in 2022. Unlock your 30 days free access to ETPrime now. But what is the right amount? Meta stock is down over 61% in 2022. Altimeter Capital Portfolio Investments, Altimeter Capital Funds So I am very unhappy because I've lost money on the deal. committed hundreds of millions of dollars to Sequoia Capital, Altimeter Capital Management and Multicoin . Our Standards: The Thomson Reuters Trust Principles. UPDATE: Altimeter Capital, PAR Capital Issue Letter to United Continental Board - United Airlines Holdings (NASDAQ:UAL) - Benzinga SPY 397.68 0.74% QQQ 293.61 0.83% BTC/USD 22299.46 5.109%. Q1 2021: 13 Largest Global Startup Funding Rounds - AlleyWatch If Meta was able to control those costs, he said, then it could double its free cash flow and improve its share price. He left GC and became co-CEO of NLG, an early online travel start-up purchased in part by IAC.He co-founded Openlist.com, a local search start up that was self-funded and sold to Marchex (Nasdaq: MCHX);He was a partner at PAR Capital, a multi-billion hedge. Brad Gerstner - Founder & Chief Ex.. - Altimeter Capital - ZoomInfo It's been a big drawdown this year. Can they maintain their growth momentum? 2,06,700 crore) a year and capped annual investment in the metaverse to $5 billion (roughly Rs . Right? Last fall, Brad Gerstner from Altimeter Capital published an open letter, telling Meta it has "lost the confidence of investors" and telling the company to throw in the towel on its metaverse project. c/o Chairman Henry L. Meyer III Despite public skepticism at times warranted we have been supporters With Snowflake, the question as to whether or not that business is going to compound, I think is not one that many people will debate. 9/29/2022 1:05 AM. Brad Gerstner - Founder & CEO @ Altimeter Capital - Crunchbase At Meta, the number of employees is up over 3x from 25k to 85k employees in just the last four years! "We think the recommendations outlined above will lead to a leaner, more productive, and more focused company a company that regains its confidence and momentum," Gerstner wrote. Altimeter SPAC Has Reported $40 Billion Deal for Ride-Hail Company Grab We dont have any demands. We don't think we're going to have 10 rate hikes and we do think there'll be an off ramp to the situation in Ukraine. Limit investment in metaverse / Reality Labs to no more than $5B per year. A newly launched P2E adventure game, Chronos: Dawn of Tie, has introduced a series of brand-new PvP elimination tournaments.Last month, the whimsical battle game organized its beta stage featuring selected players. That's why even the sell side consensus numbers have their growth rate accelerating, almost doubling between Q2 and Q4 of this year and we think it will accelerate even faster. There are a lot of companies with speculative business models, right, that are should have never been valued where they were valued and if you don't have absolute conviction, right, they can grow their product, grow their top line and grow their earnings to match where those earlier prices were, then you need to rotate those dollars out of those companies and into companies where you have that level of conviction. As you know, Altimeter Capital Management and PAR Capital Management are long-term United Continental Holdings, Inc. ("United") stockholders that together own approximately 7.1% of United's outstanding common stock. Mark Zuckerberg is a self-made billionaire and the CEO of Meta (formerly Facebook), which he co-founded in his dorm room in 2004. So you know, when I look at what's going on in the business and I try to distill it from the noise, which is what has made us good for 20 years, not following the crowd, not panicking, but really looking at the business. We had given most of that up by middle of December. On Oct. 11, Meta announced a new high-end VR headset, the Quest Pro.