- A brand-new source of income has arrived…
- There will be no going back to how things were…
- My fears around Worldcoin are coming to fruition…
What fantastic fun!
As predicted, Elon Musk just made an offer to take Twitter private for $54.20 a share in cash. That amounts to a $43 billion hostile takeover offer. There aren’t too many people or companies that can mount a deal like that.
And of course, it was announced with a tweet. Hilarious. The irony.
Musk’s SEC filing, outlining the offer, provides us with some additional context about the deal. I’ll provide Musk’s comments below from the filing as they provide us with an example of Musk’s negotiating approach:
Best and Final
I am not playing the back-and-forth game.
I have moved straight to the end.
It’s a high price and your shareholders will love it.
If the deal doesn’t work, given that I don’t have confidence in management nor do I believe I can drive the necessary change in the public market, I would need to reconsider my position as a shareholder.
This is not a threat, it’s simply not a good investment without the changes that need to be made.
And those changes won’t happen without taking the company private.
Musk’s argument as to why it’s a “high price” is based on the offer being a “54% premium over the day before I began investing in Twitter.” It’s on this point that Musk is just positioning.
The January lows this year had nothing to do with Twitter, and everything to do with the market-wide volatility resulting from horrendous monetary policy, the looming threat of increasing inflation, and a hawkish Federal Reserve implying large rate hikes throughout 2022.
In that sense, Musk’s anchor to the January lows is arbitrary. It doesn’t relate to Twitter’s present and future valuation.
Twitter is easily worth double where it is trading today, and worth even more if Musk is successful in taking the company private.
If it were me sitting on Twitter’s board, I would say no to the deal at $54.20 a share… It doesn’t make sense. And I’m sure the board will reject his initial offer.
But this is a problem that Musk wants to solve: Twitter needs to be fixed.
And the reality is that we need him – or someone else – to solve it. He would prefer to leverage the platform that has already been built. The network effects are already in place, which means that he can effect positive change more quickly.
Elon – if you’re reading this – I recommend making one more offer.
Let’s call it a “final final” offer somewhere between $65–$70 a share. I reckon that will get it done. It’ll be worth it – you’ll still at least double your money over the next couple of years, and the positive impact of the changes that you’ll make on the platform will be worth far more to the world.
To the moon, Mars, and beyond…
This blockchain project is going head-to-head with Google Maps…
Blockchain technology can often feel a bit abstract and hard to understand at times, so I like to show practical examples of applications of its use. A new blockchain project called Hivemapper is a great example.
Hivemapper is crowdsourcing a global mapping system. And, of course, there’s a strong economic incentive for participants.
This has been a major industry pain point because it has only been the large monolithic tech companies like Google or Apple who can afford to acquire or physically map the world manually. These companies have spent billions of dollars, which means smaller companies don’t have the ability to the same level of mapping data.
Hivemapper reminds me a lot of Helium, a blockchain company that has developed crowdsourced wireless networks. Anyone can purchase the hardware to run a cellular node in order to expand and contribute to the network. And for doing so, they get paid in Helium’s native cryptocurrency, HNT.
Hivemapper is very similar… except instead of a cellular base station that is part of a wireless network, participants purchase a special camera to attach to their car.
The Hivemapper “Dashcam” costs $449. And the device attaches either on top of the car or just below the rearview mirror.
Here’s a look:
Once attached, users link their dashcam to the Hivemapper app on their smartphone. Then the camera begins feeding mapping data back to the network.
And Hivemapper compensates people for their contributions in its native crypto, HONEY.
I love this concept.
People can get paid for doing something they are already doing anyway – driving their car. And Hivemapper data has a great opportunity to compete with Google Maps.
That’s because Google Maps has two weaknesses, both in how it collects data.
The first way is, the company sends out its own cars equipped with cameras to map out cities and neighborhoods. I suspect many readers have seen one of these cars driving around at some point.
Google Mapping Car
The problem here is that the map data, while relevant and useful, goes stale quickly. Google can’t update every neighborhood in real-time. It can be years before Google makes another pass of a city… So maps can become outdated from time to time.
The other way Google collects mapping data is through the app Waze.
For readers who aren’t familiar with it, Waze provides drivers with turn-by-turn directions to their destinations. At the same time, the app feeds all driving data directly back to Google. This helps keep Google Maps up to date, especially with real-time traffic patterns.
The weakness here is that Google does not compensate Waze users for the data they contribute. In fact, Google exploits users because it also collects their personal data and sells access to it to advertisers.
Hivemapper inverts the business model. Rather than exploiting consumers, it pays them for contributing mapping data by installing a dashcam. Further, Hivemapper does not collect and sell personal information for profit.
What’s more, Hivemapper will be able to provide accurate, real-time maps if enough people participate. That would make its mapping data superior to Google’s.
Simply put, this is a better model all the way around. And I can’t help but think about the possibilities…
Now we can get paid to contribute mapping data while we drive. We can also make money by running a wireless node through Helium. We can generate income from apps like STEPN just by walking or jogging. And then we could make some money playing Web 3.0 games like Axie Infinity for an hour or two a day.
Those are four brand-new sources of income available to anybody right now. Put together, I bet many people could make a full-time income just from these “participate to earn” protocols.
And this is just the beginning.
These economic incentives are powerful and help solve difficult problems in short periods of time. They democratize access to things that have historically been limited to large corporations or governments.
Of course, we’ll be investing in some of the most interesting ones in my Unchained Profits research service as they come across my radar… To learn more about that, go right here for the latest.
Our household robotic butlers are almost ready…
Big news from Tesla… CEO Elon Musk announced that its humanoid robot, Optimus, will go into production next year.
That’s far faster than most expected.
We highlighted Optimus back in September. As a reminder, it is a 5-foot, 8-inch robot that weighs about 125 pounds. It can walk about five miles per hour.
And get this – Optimus can lift up to 150 pounds.
Tesla’s Optimus Robot
Musk’s vision is for Optimus to perform many of the dangerous, boring, repetitive, or otherwise undesirable tasks that are perfect for automation.
He went so far as to say that the robot will “upend our idea of what the economy is” because it will do anything that humans don’t want to do.
Clearly, this is something that will take robotics to an entirely new level.
Optimus will be a fully-functional helper. It will be able to do all the chores around the house. It could potentially even function as a home security system by watching over our homes while we are gone.
What’s more, Optimus will be able to do more complex things like grocery shopping. We could send it our list, drop it off at the store, and run other errands while Optimus shops for us. I get a chuckle thinking about the first time one of these robots walks into the grocery store.
And here’s the thing – the technology for this already exists at Tesla.
Tesla will equip Optimus with both the hardware and software from its fully self-driving cars. It will have all the cameras and sensors. And the robot will operate using the same neural network artificial intelligence (AI) technology used for self-driving mode.
So it’s just a matter of optimizing all the tech for a bipedal robot rather than for a car. That’s how Musk can move so fast on this.
To me, this kind of product would be transformational on a global scale. I see it as very similar to the smartphone.
If we think about it, the smartphone replaced many other products that we used daily. It became our camera, our music player, our laptop, our GPS service for driving directions… and much more.
These were all features that required separate products previously. The smartphone condensed them into one small device.
Well, Optimus will be similar. It will basically be a physical instantiation of a general-purpose operating system that we can program for any needed task.
There will be no going back to the way things were done before. This may very well be an even bigger business than Tesla’s EVs.
The all-seeing orb has unleashed chaos…
New reports suggest that there are some major problems at Worldcoin right now. It turns out my warnings against Worldcoin were warranted.
For the sake of newer readers, Worldcoin is a creepy project that uses a device called “the Orb” to scan people’s face and retinas. The idea is to create a unique biometric identity for everyone on the planet. That identity then becomes a digital wallet for the project’s cryptocurrency, WDC.
Worldcoin recruited “orb operators” to go around to major cities and perform retina scans on people. In return, Worldcoin promised to pay operators in WDC… And because Worldcoin suggested that WDC could go up in value substantially as usage increased, many people quit their jobs to become operators.
Worldcoin also promised to pay anyone who signed up to have their retinas scanned $20 in WDC. And again, the pitch used by some orb operators was that the $20 would turn into a lot more money as WDC went up.
This has been going on for at least five or six months now, but guess what?
Worldcoin still has not launched its cryptocurrency. Nobody has been paid a dime in WDC yet… All they have are vouchers.
What’s more, Worldcoin has not anonymized the biometric data that it has taken so far. It is keeping that data tied to each individual. Furthermore, they have not yet committed to a timeline to delete the information.
Worldcoin has simply been preying on people desperate to earn a little extra money in the form of WDC. At the same time, Worldcoin has raised about $125 million in venture capital – much of that going to pay the core team.
So all my fears around Worldcoin are coming to fruition very quickly. This is not a smart way to stay out of trouble from regulators… unless, of course, there are those in governments that have a hand in the project one way or another.
I hope everybody heeded my warning to avoid this company and its “all-seeing orb”…
Editor, The Bleeding Edge
P.S. My State of the Tech Market strategy session will only be available for a couple more days. On Friday – tomorrow – it will go offline… So please make sure to catch up before then.
During this event, I shared my thoughts on inflation… interest rates… and the geopolitical situation we’re in. There’s a lot of uncertainty, so I wanted to let my readers know how we’re going to position ourselves for the coming months.
And there’s one asset class I shared that can help protect and grow our profits… even in a possible recession. If you’d like to watch before this strategy session disappears, simply go right here.
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