008. The year of the Horse.

008. The year of the Horse.

Hello tech investors, happy new year. 2014 corresponds to the Year of the Horse in the Chinese calendar. Needless to be a chinese culture literate to know what a horse refers in terms of power, fastness and impulse. This year 2014 is gonna be fast, impulsive and powerfull.

As most of you surely know, this year could become the burst of the bubble. The bubble of IT start-ups which are over rated nowadays. See the earning per share of companies like Facebook, Twitter or Snapchat. See then their stock prices which are far higher than realistic prospections.

This situations seems to a second-before-galloping of a horse. There are intensity and anxiety in the sector, there are passion and sweat, there are expectations of a great race. But not every horse will be a champion. Time after the race starts we will see how some of the above companies will drastically deflate its prices, putting down to earth millions in stocks and throwing down to hell thousands of investors.

How to bet on the champion? We'll analize the most important horses running nowadays, one by one, to make clear each one's chances. Despite there are some others, we will compare the chances of those bigger brands according to its growing capacity, its market niche and it forecasts:

1. Facebook (FB). Despite its actual supremacy among social networks, its aquilles bead is lacking of usability, and difficulty reaching audience for companies paying their service fees. As a research shows in openculture.com the algorythm Facebook uses to show user`s contacts and fan pages makes it messy and unclear. Facebook against others emerging social media is a mature product which is not focused on anything usefull for the user (apart of wasting time or checking user's friends and family last holidays pics).

Graphic: Manuel Nappo

2. Youtube / Google Plus. The video site belonging to Google (GOOG). This fact by itself gives a clear path to confidence. Google is expanding its advertising market outside the pc, not only as futurible mobile devices developer but also as automobile Operating System provider. That means plenty of growing opportunities for Youtube Channels as they will appear inside a car as an option at the begining, and as electrical windows later on (a must have for a good car). Also consider at this point the Google Plus social media, not so impressive right now but going up quite fast.

3. Twitter (TWTR). A very interesting one! Its booming start on the markets made some analyst to suggest caution on its shares; however it is becoming a faster and better tool to find information on the internet, even better than Google when seeking for non static information. Also their advertising system is working in such a succesfully way that it is doubling revenues each year:

Graphic: Statista

4. Sina Weibo. (SINA). We speak about this one as it is the main one. This microblogging site has become very popular. It has a clear promotion strategy, the presence of luxury brands inside the social media: 

Graphic: Techinasia

Chinese population is becoming middle class, hence its social media companies are HUGE and are growing FAST and FURIOUS:

Graphic: Techinasia

5. LinkedIn.(LNKD). This social media has still plenty of room to grow. Specially if it manages well to expand to rising economies, where professionals (their target market) are growing in number.

6. Snapchat. Its rejection to a 3Billions$ offer from Facebook has spreaded like gun powder. This company offers a undervalued usability: is fleeting. But how many users of snapchat are really aware of its potential? Most of users of this platform do share pictures, the same way they share them on instagram or post them on facebook. So even the concept is brilliant, the segment of the market is not (by now) well attained.

7. We chat. A nearly 250 million users chat app owned by chinese web giant Tencent (TCHY). It is actually second only to whatssapp but its growth rate is overwhelming. Also its usability, as they are not afraid to book and pay a taxi service through this app, is a bright point.

Said that, we´ll conclude by saying that no all above mentioned companies will succeed this year of the horse. For sure some of those companies will run fast and become even bigger. Other companies will deflate quickly. My Bet? Look after west pacific companies instead of east pacific ones ;)

http://www.hugoplisbona.com/

Hugo P. Lisbona works as new technologies advisor for investment. This blog is altruistic and only seeks to share knowledge that is there, but it does not reach all the people who could benefit from it.

For any questions I will be happy to answer from contact@hugoplisbona.com

007. In troubled waters fish are caught

In troubled waters fish are caught

In a river with turbulent waters good fisher can make a huge catching. Finding the river is an overall work, thus seeking the best place to fish is a deeper one. Maybe it is even a diving in matter.

Talking about investments, a macroeconomic review will lead us to find the troubled waters:
As newspapers published recently, there are good opportunities to invest right now in Spain. "The country's economy is out of recession, and there are already data to prove that" spanish prime minister said earlier this week in Whashington and IMF president Christine Lagarde confirmed. Obama's words on spanish actual situation also boost investor's confidence in this Country.

However those news may not reflect the investors willing. That's why I went deeper into it and I dived into the river:
As technology investment blogger I went to the Spain Investors Day 2014. An investors focused event organized inside Madrid Bourse. My intention was to gather real opinions from real investors.

Just after the arrival I had a short conversation with Juan Carlos Villanueva, responsible of BME comunication, his thoughts on the investment opportunities in Spain are clear "If the government points a 0.6% growth rate this year, they surely have better forecasting data to publish". His colleague referred to the success of this event "the amount of investors have almost doubled the previous year's, that means Investors see something here".

Later on, upstairs the appetizer atracted both investors, CFOs and press. Conversation there worked as a constantly selfpromotion from interviewed companies either a what you have that I can buy from investors. Among all chatting I conversed with Computershare's Managing Director Pedro Saa, who told me about "This is an australian story of success, the company was founded in 1978 and nowadays is global". This company is now stablished in Spain, their stock priced around 10$ and its growing trend make it an interesting option.
Doing some smalltalk with the participants I found out the companies which brighted the most,  as BBVA, Santander, DIA and Prosegur.

Back downstairs I was welcomed to a german investor group's table for the dinner. They came here from Frankfurt and were specialized in Oil, Gas and Construction companies. Their minimun investment was 10M Euros...their thoughts about spanish markets? As it follow:
- They see spanish economic model heading to the chinese one.
- They argumented Repsol was weakening against other european Oil companies.
- They felt lack of confidence about tourism sector growth in Spain, a special reference to TUI.

Hence through this post here are some picks that may rock up their value on this year. We will follow up their records so stay tuned.

As the dinner and the wine keep going, the conversation went abroad spanish boundaries. We had a conversation about football, talking about winning probabilities of Spain / Germany / Brazil in the oncoming World Cup. And really interesant words were said about Chinese market, but we will go deeper into that in the next post: 008. The Year of the Horse...

I hope this post will add value to your investment plans. If you find it wrong please comment! And if you liked it do share!

Hugo P. Lisbona
www.hugoplisbona.com