FirstMark Capital announces new funds with a fresh $650 million in investment capital – TechCrunch

FirstMark Capital announces new funds with a fresh $650 million in investment capital – TechCrunch

FirstMark Capital, the New York-based VC firm whose portfolio includes Shopify, Riot Games, Pinterest, Airbnb, InVision and more, has today announced the close of its two newest investment vehicles. FirstMark V is a $380 million early-stage fund focused on seed and Series A investments, while FirstMark Opportunity III is a $270 million vehicle dedicated to […] Stocks opened sharply higher Tuesday morning followed a report that the Trump administration was poised to unveil a $1 trillion proposal for U.S. infrastructure work, in a move to help boost the domestic economy. A record jump in retail sales in May also helped fuel the early rally. Carnival stock has risen significantly since its recent low, but the rally is just beginning.

FirstMark Capital, the New York-based VC firm whose portfolio includes Shopify, Riot Games, Pinterest, Airbnb, InVision and more, has today announced the close of its two newest investment vehicles.

FirstMark V is a $380 million early-stage fund focused on seed and Series A investments, while FirstMark Opportunity III is a $270 million vehicle dedicated to follow-on investment in portfolio companies and select growth-stage investments. The total assets under management across all FirstMark vehicles is $2.2 billion.

The investment team at FirstMark is made up of five partners: Rick Heitzmann, Amish Jani, Matt Turck, Beth Ferreira and Adam Nelson.

While FirstMark doesn’t focus exclusively on the New York ecosystem; at least half of its deals are done on the East Coast, with a particular focus on tech hubs along the East Coast, such as NYC, Boston, Toronto, Ottawa, Philadelphia and Washington, D.C.

The firm made several early bets in industries that have been significantly accelerated by the coronavirus pandemic, including healthcare (Kinsa, Parsley Health), gaming (Discord, Riot Games), enterprise workflow (InVision, JustWorks, Pendo, Guru) and automation (Ada, nextmv, Hyperscience).

FirstMark will continue to look for opportunities in these spaces, with particular focus on health tech and gaming.

While gaming represents a huge opportunity, it can be a challenging sector to break into, with such concentrated power at the platform and publisher level. Still, partner Amish Jani sees the industry disaggregating as we speak.

“Think about the world prior to Unreal or Unity, where you had to build the whole thing including the game engine,” said Jani. “Eventually that pulled out. Think about gaming infrastructure servers for streaming. That’s gotten pulled out. When we think about communications, Discord has become a huge part of an overlay messaging framework in gaming. That’s kind of gotten pulled out into its own layer. So I think what you’re seeing is a lot of the pieces of gaming are getting pulled apart as the market has swelled and become so large, and we’re certainly huge believers in the picks and shovels.”

The firm has also had some big wins in D2C, including Brooklinen, Airbnb and Ro.

“In general, D2C tends to be a game of either scale or niches,” he said. “You have to find the narrow pathway where you have some degree of supply chain differentiation and a really unique brand that creates organic virality. A lot of times, it’s a heavy organization of community around that concept of commerce experience. It’s not just buying something but buying into the lifestyle and experience of a brand and a community around that.”

In some cases, he added, it involves regulatory change, like in the case of Airbnb.

FirstMark goes beyond simply writing checks to take a holistic approach to fostering and growing its portfolio companies with the FirstMark Platform, which is made up of its Talent, Corporate and Expert Networks.

The Expert Network is made up of 100+ events led by CEOs, CTOs, CROs and CMOs from companies like GitHub, Grubhub, Looker, Cloudera, Twilio, Zendesk, Cloudflare, Mailchimp, PagerDuty and more. The Talent Network is organically interwoven with the Expert Network, with several experts who have come in as speakers and ended up joining a portfolio company as a CXO, an independent board member or even entering the FirstMark portfolio as a founder.

The Corporate Network, meanwhile, focuses on helping portfolio companies strike deals with larger corporations.

As part of FirstMark’s Platform strategy, it also runs several public event series around Data, Design and Engineering.

The firm is also on a mission to diversify its pipeline and portfolio in the wake of the George Floyd protests and the broader Black Lives Matter movement. Starting in 2019, half of FirstMark deals have been with founders who aren’t white males, such as female founders and founders of color. However, underestimated founders make up about 3.5% of FirstMark’s portfolio — of 85 companies, just three are founded by Black or Latinx founders.

Jani explained to TechCrunch that true diversification within the portfolio starts with measurement at the pipeline level, and not just by looking at the number of diverse founders funded, or the dollar amount invested in those founders. This echoes sentiments from BLCK VC’s Sydney Sykes, who recently spoke to TechCrunch about specific actions firms can take to be more inclusive, saying that VC firms have to measure to the top of the funnel to break the cycle of network effects that allow VCs to fund founders that look like them.

The firm has put together a standing weekly task force meeting to address issues of systemic racism in VC and adjust the firm to think more deeply about how founders get in the door, which startups cross their desk and, ultimately, grow that 1% figure.

Jani also said that, after some deliberation, the firm has decided not to take Juneteenth as a holiday but rather to make it a day of service, where the firm’s employees will volunteer, mentor or give back to the community in some way.


Author: Jordan Crook

1 day

Stock market news live updates: Stocks rise after record retail sales jump, reports of more stimulus

Stock market news live updates: Stocks rise after record retail sales jump, reports of more stimulus

Stocks surged Tuesday after much stronger than expected retail sales data for May boosted investor confidence in a speedy economic recovery. Reports of additional stimulus from the Trump administration in the form of a $1 trillion infrastructure package, along with hopes that a common drug could help treat coronavirus patients, also helped catalyze the rally.

[Click here to read what’s moving markets heading into Wednesday, June 16]

Retail sales jumped by a record 17.7% in May over April, coming in at more than double the consensus estimate for a rise of 8.4%. This followed a record 14.7% plunge in retail sales in April, with the reversal suggesting consumer spending was picking back up as businesses began to reopen in May.

“We’ve been used to seeing record lows in economic fundamentals over the past few months and to see the pendulum swing so far in the other direction is nothing if not encouraging,” Mike Loewengart, managing director of investment strategy for E-Trade Financial Corporation, said in an email Tuesday. “Looking at this morning’s number in aggregate, this is another indicator that a v-shaped recovery could be more likely than we initially thought.”

Separately, investors also eyed multiple reports stating that the widely used steroid dexamethasone helped reduce the death rate of patients with severe cases of Covid-19, according to trial results.

The moves higher in equities sent the three major indices higher for a third straight session.

Tuesday’s developments added to the risk-on mood sparked after the Federal Reserve announced Monday it was expanding its own stimulus program for the virus-stricken economy. The Fed said it would begin purchasing individual corporate bonds as part of its emergency lending program, expanding the Fed’s previously announced Secondary Market Corporate Credit Facility, which had until Monday only included purchases of exchange-traded funds.

“I think what they’re trying to get away from is the perception that they’re favoring one company or one industry over another so they try to spread it out,” Kathy Jones, chief fixed income strategist at Charles Schwab, told Yahoo Finance’s The Ticker of the announcement. “But again, the bonds have to meet their criteria, which means they’re not buying the lowest credit quality bonds in the high yield market. They’re going to be buying those with higher credit ratings and up to a five-year maturity.” 

The slew of more positive economic data combined with additional stimulus news at least temporarily diverted investor attention from signs of increasing coronavirus cases in some parts of the country. Texas and Florida each reported record new coronavirus cases earlier this week, and other states including Arizona and California have also recently seen renewed increases in cases with their own reopenings under way.

Travel and leisure stocks including American Airlines, Norwegian Cruise Line Holdings, Royal Caribbean International and Hilton – which have seen their shares mostly move in lockstep in recent weeks with states’ reopenings under way – gained in late trading.

Here were the main moves in markets as of 4:05 p.m. ET:

  • S&P 500 (^GSPC): +58.15 (+1.90%) to 3,124.74

  • Dow (^DJI): +526.82 (+2.04%) to 26,289.98

  • Nasdaq (^IXIC): +169.84 (+1.75%) to 9,895.87

  • Crude (CL=F): +$1.05 (+2.83%) to $38.17 a barrel

  • Gold (GC=F): +$7.30 (+0.42%) to $1,734.50 per ounce

  • 10-year Treasury (^TNX): +5.4 bps to yield 0.7560%

Here were the main moves in markets, as of 12:31 p.m. ET:

  • S&P 500 (^GSPC): +58.02 points (+1.89%) to 3,124.61

  • Dow (^DJI): +555.1 points (+2.15%) to 26,318.26

  • Nasdaq (^IXIC): +161.64 points (+1.66%) to 9,887.66

  • Crude (CL=F): +$0.26 (+0.7%) to $37.38 a barrel

  • Gold (GC=F): +$8.60 (+0.5%) to $1,735.80 per ounce

  • 10-year Treasury (^TNX): +4.9 bps to yield 0.751%

Federal Reserve Chair Jerome Powell began delivering his Semiannual Monetary Policy Report to Congress Tuesday morning, reiterating the Federal Reserve’s cautious stance on the pace of the economic recovery as the coronavirus pandemic continues in the U.S.

“Significant uncertainty remains about the timing and strength of the recovery,” Powell said in prepared remarks. “Much of that economic uncertainty comes from uncertainty about the path of the disease and the effects of measures to contain it. Until the public is confident that the disease is contained, a full recovery is unlikely.”

Still, Powell noted that “some indicators have pointed to a stabilization, and in some areas a modest rebound, in economic activity,” highlighting the much stronger than expected May jobs report.

The National Association of Home Builders’ (NAHB) confidence index for builders rose by 21 points to 58 in June, coming in above the 45 print expected by consensus economists. Readings above 50 reflect a positive market.

“As the nation reopens, housing is well-positioned to lead the economy forward,” NAHB Chairman Dean Mon said in a statement. “Inventory is tight, mortgage applications are increasing, interest rates are low and confidence is rising. And buyer traffic more than doubled in one month even as builders report growing online and phone inquiries stemming from the outbreak.”

U.S. business inventories fell by more than expected in April as the coronavirus pandemic weighed on imports and global commerce.

Business inventories dropped by 1.3% in April, extending a 0.3% drop from March. Motor vehicle inventories plunged by 8.4%, weighing on the overall print. Retail inventories excluding autos, a measure included in the calculation of gross domestic product, declined by 1.1%.

Here were the main moves in markets as of 9:31 a.m. ET:

  • S&P 500 (^GSPC): +83.22 points (+2.71%) to 3,149.81

  • Dow (^DJI): +795.79 points (+3.12%) to 26,567.07

  • Nasdaq (^IXIC): +210.74 points (+2.17%) to 9,940.37

  • Crude (CL=F): +$1.09 (+2.94%) to $38.21 a barrel

  • Gold (GC=F): +$0.70 (+0.04%) to $1727.90 per ounce

  • 10-year Treasury (^TNX): +7.1 bps to yield 0.773%

Domestic industrial production rose by 1.4% in May after a record decline of 12.5% in April, data from the Federal Reserve said Tuesday. Consensus economists had expected industrial output to rise by 3% in the month, as factories, mines and utility businesses picked up activity in May. May’s increase in output was led by the production of motor vehicle and parts.

Capacity utilization, or a measure of the proportion of a plant being used, also posed a modest rebound in May. This rose to 64.8% in May from 64% in April.

Retail sales surged in May over April following a record decline, in a sign that consumer spending was beginning to recover from a nadir amid the coronavirus pandemic.

Retail sales rose 17.7% in May, following April’s 16.4% drop over the prior month, the Commerce Department said in its advance report Tuesday. Consensus economists expected retail sales to rise 8.4% in May, according to Bloomberg data.

Excluding auto and gas sales, retail sales rose 12.4%, also better than the 5.1% rise expected in May. This measure of retail sales fell 16.2% in April over March.

Here were the main moves during the pre-market session, as of 7:28 a.m. ET Tuesday:

  • S&P 500 futures (ES=F): 3,107.75, up 34.75 points or 1.13%

  • Dow futures (YM=F): 26,222.00, up 417 points, or 1.62%

  • Nasdaq futures (NQ=F): 9,901.00, up 100.5 points, or 1.03%

  • Crude (CL=F): +$0.62 (+1.67%) to $37.74 a barrel

  • Gold (GC=F): +$7.30 (+0.42%) to $1,734.50 per ounce

  • 10-year Treasury (^TNX): +4.4 bps to yield 0.746%

Here were the main moves at the start of the overnight session for U.S. equity futures, as of 6:07 p.m. ET:

  • S&P 500 futures (ES=F): 3,085.00, up 12 points or 0.39%

  • Dow futures (YM=F): 25,926.00, up 121 points, or 0.47%

  • Nasdaq futures (NQ=F): 9,828.75, up 28.25 points, or 0.29%

A trader wears a face mask on the floor of the New York Stock Exchange (NYSE) following traders testing positive for Coronavirus disease (COVID-19), in New York, U.S., March 19, 2020. REUTERS/Lucas Jackson TPX IMAGES OF THE DAY

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Author: Emily McCormickReporter

2 Reasons to Buy Carnival Cruise

2 Reasons to Buy Carnival Cruise

America is starting to reopen its economy, and this is great news for tourism companies like Carnival Corporation (NYSE:CCL) (NYSE:CUK). The cruise ship operator has seen its share price rocket from a low of $7.80 in early April to $19.44 as of Monday’s market close. That’s a 149% surge in two and a half months, and the rally looks far from over. While nothing is guaranteed, the battered tourism company has several bullish tailwinds that could send its share price even higher.

First, governments are beginning to lift restrictions on tourism. Second, Carnival can survive in a low-revenue environment because of its strong balance sheet and liquidity. And finally, the company’s valuation is still very low compared to its pre-crisis revenue and earnings. 

Animation of a cruise ship sailng through troubled waters.

Image source: Getty Images.

Travel and tourism make up around 10.4% of global GDP, and governments around the world have big incentives to reopen the industry in time for the lucrative summer season. Things seem to be moving faster in Europe, where countries are further along the pandemic curve.

German river cruise operator Nicko Cruise was the first European line to resume voyages. And Connecticut-based American Cruise Lines is resuming trips in June. The company plans to sail out of Portland, Oregon, and traverse the Columbia and Snake Rivers despite the CDC-mandated No Sail Order.

Small operators like American Cruise Lines (whose ships carry fewer than 200 people) can skirt the No Sail Order because the restrictions apply only to ships carrying 250 or more passengers. But large operators like Carnival will have to wait until the order expires on July 24 before they can start sailing again. Investors should keep in mind that the order can be lifted sooner if the Secretary of Health and Human Services decides the public health emergency is over — or it can be extended if the authorities decide cruising is still too risky. 

The good news is that Carnival is well equipped to survive in a low-revenue environment until restrictions are lifted. That’s because the company has a respectable pile of cash on its balance sheet and has drastically reduced its expenses. 

Carnival raised a combined $6.4 billion in debt and equity financing to help shore up its liquidity. On top of that, the company has announced a combination of layoffs, reduced workweeks, and salary reductions that are expected to save hundreds of millions of dollars annually. According to CEO Arnold Donald, Carnival has enough liquidity to meet all its obligations in a zero-revenue environment for the rest of 2020, which would be a worst-case scenario. 

Arnold further states that 2021 cruise bookings are strong. And competitor Norwegian Cruise Lines reports that 2021 bookings are within historical ranges despite higher prices. This is important because the cruise industry will probably need to sail at reduced capacity to ensure safety onboard, which could lead to a situation where demand outstrips supply, giving the industry better pricing power.

Carnival also plans to stagger fleet reentry to optimize its operations based on demand and doesn’t expect any demand issues in the start-up period of operations.

Carnival Corporation remains a risky stock, despite the bullish headwinds. That’s because the company faces risk from things outside its control such as a possible second wave of coronavirus or an extension of the CDC’s No Sail Order. Meanwhile, the $6.4 billion of debt and equity financing raised earlier this year will expose investors to dilution and higher interest expense over the long term.

With that being said, Carnival stock is still trading 64% below its pre-pandemic 52-week high of $53.34. This suggests that there is still potential for the shares to bounce back when things return to normal. The company’s strong balance sheet and the reopening of the tourism industry make the stock worth considering for risk-tolerant investors who believe in the long-term success of the cruise industry.


Author: Will Ebiefung

FirstMark Capital announces new funds with a fresh $650 million in investment capital – TechCrunch

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