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  • Can Zoom Zoom past its slump? 📹

Can Zoom Zoom past its slump? 📹

PLUS: Big Tech Becoming VCs 🏧

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Here's what we're serving up today:

  • Can Zoom Zoom past its slump? 📹

  • Big Tech Becoming VCs 🏧

  • Asteroids ☄️

  • Trending Tools ⚒️ 

Can Zoom Zoom past its slump? 📹

What’s the epitome for a tech company?

  1. Growth?

  2. Profits?

Nah. It’s when you become synonymous with a thing so much that you become a verb. And few companies have become as synonymous with video calling as Zoom.

Zoom was one of the biggest darlings of the pandemic. But things haven’t been faring so well lately.

The Glory Days

Once upon a time, when handshakes became a relic and sweatpants became haute couture, Zoom zoomed into our lives. 

From playing online games to pretending to attend virtual meetings, it seemed as if life was incomplete without Zoom. 

And boy oh boy, did it bring good fortune for Zoom. The company clocked in a phenomenal $882M in revenue in Q1-2021, an almost 5x jump from its last pre-pandemic quarterly revenue of $188M

At its height, Zoom’s (NASDAQ:ZM) shares were trading at ~$568 valuing the company at a staggering market cap of $160B+.

The Not-So-Glory Days

Fast forward to present day and the company’s market cap is a fraction of what it was at its height. What happened?

Investors seemed to have visualized a utopian future for Zoom where the only way it could go was up - until people actually started to go out and competition started catching up. 

Zoom’s rise during the pandemic days paved the way for the ‘Video Conferencing Wars’ as players such as Microsoft Teams, Salesforce’s Slack and Cisco’s Webex started battling for a piece of the pie. 

This led to Zoom losing out market share resulting in slower growth post-pandemic. 

Still, let’s not undersell Zoom. The pandemic boosted it into $1B+ quarters with solid profits.

The company posted a revenue of $4.53B in 2024.

But Wall Street is like that friend who’s never quite satisfied. They don’t just want cash; they also want the promise of tomorrow’s cash.

Growth, Growth, Growth!

Zoom is trying to diversify their revenue streams and not just be a one-trick pony. The company has expanded their product offerings to products such as Zoom Phone, Zoom Contact Center and everyone’s beloved - AI features.

Though relatively smaller sources of revenue right now, the new products show promise with Zoom Phone at 7M paid customers and Zoom Contact Center at a $500M revenue run rate

Could these new product offerings zoom through and pull the company out of its growth slump?

What do you think? Let us know by replying to this email. 

Sponsored by

Missed out on Ring and Nest? Don’t let RYSE slip away!

Ring 一 Acquired by Amazon for $1.2B

Nest 一 Acquired by Google for $3.2B

If you missed out on these spectacular early investments in the Smart Home space, here’s your chance to grab hold of the next one.

RYSE is a tech firm poised to dominate the Smart Shades market (growing at an astonishing 55% annually), and their public offering of shares priced at just $1.50 has opened. 

They have generated over 20X growth in share price for early shareholders, with significant upside remaining as they just launched in over 100 Best Buy stores.

Retail distribution was the main driver behind the acquisitions of both Ring and Nest, and their exclusive deal with Best Buy puts them in pole position to dominate this burgeoning industry.

Big Tech Becoming VCs 🏧

As AI captures headlines, there’s a battle brewing in the back. The battle for who holds the most powerful piece of technology in almost two decades after the Internet and Big Tech is trying to get ahead. 

How, you ask? By wielding one of their most powerful weapons: Checkbooks.

Unsurprisingly, one of the biggest investors in AI startups has been Big Tech, specifically Microsoft, Amazon, Nvidia and Google (MANG).

These companies have been strategically placing their financial chips on the AI chess board.

The total capital raised in their 2023 deals was $25B+, which is ~8% of the total venture raised in North America. 

The MANG investments are particularly concentrated in Data and AI: their deals raised $23B.

Large Cheques for Large Language Models

This shouldn’t come as a shock but most of the investments are in LLM startups. And that’s by intention. 

LLM startups are on the hunt for - customers computing resources. 

Cloud providers are on the hunt for - customers. 


And it turns out that cloud providers funding their customers is a great business model. The investment capital makes a round trip back to the P&L in the form of revenue and helps them break even on the investment faster. 

Digital TollBooths

The MANG companies have transformed into the digital era’s toll collectors, pocketing fees from a vast number of customers.

It is estimated that for every $1 of inference that customers pay their LLM provider, more than half of it ends in the hyper-scaler’s piggy bank to cover those hefty infrastructure bills.

In an earlier era, Big Tech might have just bought these startups outright. After all, they’re not pinching pennies: MANG collectively raked in $276B in operating profits in 2023 alone. 

However, Washington’s antitrust advocates want to restrain big tech bloat.

That suggests these enormous investments may yet be seen as a regulatory dodge. Big Tech companies are in effect locking in their customers while juicing their own revenues. 

Learn from investing legends

Warren Buffett reads for 8 hours a day. What if you only have 5 minutes a day? Then, read Value Investor Daily. We scour the portfolios of top value investors and bring you all their best ideas.

☄️ Asteroids ☄️

Blue Origin has successfully completed its NS-25 mission, resuming crewed flights for the first time in nearly two years. 🚀🌌 

Several OpenAI Superalignment team members, including co-lead Jan Leike, resigned over resource disputes and safety concerns. OpenAI is now integrating their work into broader teams. 🤖🦺 

Tesla might drop Steam support on new Model X deliveries, hinting at a shift away from gaming features as the company focuses on robotaxis. 🎮🚗

🌐 Maven - Social network designed to cater to your interests

📽️ VLLO - Easy video editing app for beginners

💬 Becca - AI assistant for viral LinkedIn posts

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