Hello and welcome to Alts Cafe
Highlights from the full issue:
- Macro: The US economy’s soft landing is still on track
- Real Estate: Houston’s luxury home sales surged 34%
- Startups: Cybersecurity startup Wiz raised $1 billion
- Private Credit: Silver Lake raised $20.5 billion for its 7th fund
- Crypto: Crypto venture capital funding surpassed $1 billion
- NFTs: NFTFN’s presale hit $550,000
- Art: Jeff Bezos’ painting sold for nearly $53 million
- Vintage Autos: A 1973 BMW CSL is up for auction
- Coins: A 1776 Libertas silver medal sold for $180,000
- Farmland: Farmer confidence is at an all-time low
- Luxury: Luxury Brands have entered the dining space
- Wine, Tequila, and Spirits: San Diego wine hit a sales record
- Film & Music: Warner Music Group is up 7% from last year
- Precious Metals: The silver market is on the rise
- Collectibles: $2 million worth of baseball cards are missing
- Websites: AI topped the keyword chart for March
Let’s go.
Wyatt
Table of Contents
Macro View
Bullish News
- The US economy’s soft landing is still on track, with consumption sitting more than $1.5 trillion above 2019 levels.
- The US attracts 33% of global financial flows now compared to 18% before the pandemic.
- Brits’ confidence in managing household finances reached its highest level since November 2021.
- UBS stunned investors with a $1.8 billion Q1 profit, nearly triple analyst forecasts.
- Corporate bonds outperformed government bonds at the highest rate in a century, drawing $438 billion in inflows this year.
- Britain’s economy grew by 0.6% in Q1 2024, the strongest growth since Q4 2021.
Bearish News
- IMF chief called the US’s $34 trillion debt “mind-boggling,” warning it may limit growth as it uses 17% of federal revenue.
- Economist David Rosenberg noted the US might face recession with Q1 GDP growth at 1.6% and manufacturing contracting 17 of the last 18 months.
- Gov. Newsom proposed eliminating 10,000 state jobs as California faces a budget deficit of at least $45 billion.
- Over 25% of US metro areas still have not recovered the jobs lost during the pandemic recession.
- Russia’s military spending has outstripped oil and gas salaries, deepening a labor crisis with a 40,000 worker shortfall.
What are the odds?
Get $25 to play around with using this link.
What are we doing?
Altea Highlights
Investor Field Trips
We’ve locked in Nashville 🎸 for a music-themed investing adventure to Music City, USA.
Get your boots spit-shined and your guitar tuned.
Est. dates: October 21 – 25
We’ll discount the first few members who make a deposit. Let me know if you’d like to join.
ALTS 1 Fund news
We’re accepting new commitments this month and will have the portal live in a couple of weeks for signatures and wires.
Real Estate
Bullish News
- Houston’s residential market rebounded strongly in April as luxury home sales surged 34%.
- Over 90% of metro areas saw home price increases in Q1 2024, with the median price for single-family homes up 5%.
- Columbus’ building code change sparked a surge in residential proposals, with February applications at 3,435, up from January’s 444.
- Households expect home price growth to increase to 5.1% over the next 12 months, the second-highest reading in the NY Fed’s 2024 SCE Housing Survey history.
- Nashville’s housing market rebounded in April with an 11% increase in home sales and an 18% jump in inventory.
- San Antonio welcomed 100,000 new residents in 3 years, with 70% from domestic migration.
Bearish News
- Real estate developer Clarion Properties took a $60 million loss on an office building it bought for $86 million in 2019.
- Berkshire Hathaway’s first-quarter profits plummeted to $12.7 billion, roughly one-third of last year’s $35.5 billion.
- Redfin’s CEO says “housing has hit rock bottom,” with only 4 million people expected to move this year.
- Fortress Investment Group is planning one of the largest foreclosures in American history, targeting the Cohen Brothers who owe nearly $550 million.
- Blackstone’s $59 billion BREIT faces scrutiny over inflated valuations in a falling real estate market.
- Opendoor Technologies stock dropped 34% in April due to stubborn inflation and a terrible housing market.
How to invest in real estate right now:
Looks like Metro is Boomin.
Startups
Bullish News
- Cybersecurity startup Wiz raised $1 billion at a $12 billion valuation in a private funding round.
- South Korean AI chip startup DEEPX secured $80 million in a Series C at a $529 million valuation.
- Max Altman’s Saga Ventures raised $125 million to invest outside Silicon Valley hype.
- UK biodiversity startup Dendra Systems raised a $15.7 million Series B as investors pour capital into climate tech.
- Hard tech startup Layup Parts landed a $9 million round led by Founders Fund to transform composites manufacturing.
- Paris-based Mistral AI is raising money at a $6 billion valuation, triple its December valuation.
- AI startup Atlan raised $105 million in a Series C round led by GIC and Meritech Capital at a $750 million valuation.
Bearish News
- China’s IPO freeze caused a liquidity crunch for tech startups, with IPO funding down 90% to a record low since 2013.
- Shopify reported a surprising first-quarter loss of $273 million, causing shares to plunge 20%.
- Battery startup Ambri filed for Chapter 11 bankruptcy with lender sale plans.
- Coinbase CEO Brian Armstrong is facing a new class-action lawsuit alleging investors were deceived into buying securities.
- Neuralink co-founder Dr. Benjamin Rapoport left the company over safety concerns, claiming the microelectrode system was too invasive.
How to invest in startups right now:
I too consider a needle piercing a computer chip into my brain as “invasive.”
Private Equity and Private Credit
Bullish News
- Brookfield Asset Management invested $1.5 billion in US-based PC manager Castlelake, acquiring a 51% stake in its fee-related earnings.
- Silver Lake raised $20.5 billion for its seventh fund.
- PNC and TCW partnered to offer PC to middle-market companies, targeting $2.5 billion in investor equity.
- Wellington Management launched a PC vehicle in 2023, targeting $30 billion in assets over ten years.
- Bain Capital explored a $6 billion deal to purchase education software provider PowerSchool, valued over $4 billion.
Bearish News
- Moody’s Ratings warned of red flags in the $1.7 trillion PC market, expecting more LBO defaults.
- PE and venture capital deal value in Asia-Pacific plunged 85.4% in Q1 to $1.20 billion, the lowest since 2021.
- The PE firm behind failed Australian airline Bonza faces fraud accusations in a lawsuit, claiming double-pledged assets.
- China’s IPO freeze is starving tech startups of funds, with IPO raises down 90% to $2.6 billion in early 2024.
- Apollo Global Management has been accused of profiting from elderly deaths through a fraudulent life insurance scheme.
How to invest in PE and Private Credit right now:
If Bain Capital was cool they’d buy PowerSchool and change it to PowerRecess.
Crypto
Bullish News
- Crypto venture capital funding surpassed $1 billion for the second consecutive month in April.
- Pantera Capital predicted Bitcoin could soar to $114,000 by August 2025, based on a stock-to-flow model analysis.
- Digital Currency Group posted a 50% year-over-year increase in Q1 revenue, reaching $229 million.
- Crypto whales are secretly accumulating Polkadot as the blockchain sees increased activity, with over 600,000 active addresses in March.
- BlockDAG is capturing investor attention with its 30,000x ROI potential as its presale reached over $24.6 million.
Bearish News
- The SEC made a “preliminary determination” to file an enforcement action against Robinhood Crypto.
- A US court ordered the forfeiture of 279 crypto accounts tied to North Korea’s laundering of stolen assets.
- LocalMonero, a peer-to-peer trading platform for privacy coin Monero, shuttered its services on May 7th.
- Cardano creator Charles Hoskinson said the Biden administration has engaged in a coordinated effort to kill crypto.
- A cryptocurrency trader lost nearly $70 million, about 97% of their assets, in an “address-poisoning” scam on Coinbase.
- The SEC argued a $2 billion penalty against Ripple is needed.
How to invest in Crypto right now:
Does anyone still believe in stock-to-flow?
NFTs
Bullish News
- NFTFN’s presale hit a remarkable $550,000.
- CryptoPunks and Bored Ape Yacht Club led NFT daily sales, putting Ethereum on top with $7.7 million in sales.
- The top ten NFT marketplaces’ trading volumes soared past $4.7 billion in March, with Magic Eden claiming $1.7 billion.
- Magic Eden surpassed Blur as the premier NFT marketplace in April, with trading volume exceeding Blur’s by $108 million.
- Galaxis, a Singapore-based Web3 platform, raised $10 million from funders ahead of its token launch.
- Sweet recently powered the launch of NHL Breakaway, the NHL’s official digital collectibles platform.
Bearish News
- Ethereum NFT sales plummeted to $241 million in April, a 50.7% decrease from March.
- A Bored Ape Yacht Club holder lost three rare NFTs valued at $164,400 to a phishing attack.
- OpenSea’s NFT trading volumes nosedived 33% over the past 30 days to $89 million.
How to invest in NFTs right now:
Make some trades on Magic Eden.
Artwork
Bullish News
- Art auction sales at Christie’s, Sotheby’s, and Phillips over the next two weeks are expected to total $1.2 billion.
- Jeff Bezos’ most prized possession, a painting, broke historical auction records at almost $53 million.
- TEFAF’s opening night showed strong sales and raised $480,000 for Memorial Sloan Kettering.
- A 1904 Diego Rivera painting was appraised at $1 million on Antiques Roadshow, the highest in the show’s history.
- Christie’s New York will auction Jean-Michel Basquiat’s rarely seen 1982 painting “The Italian Version of Popeye has no Pork in his Diet” with a $30 million estimate.
- A painting stolen from Chatsworth House 45 years ago in a smash-and-grab raid was discovered at auction and safely returned after a three-year negotiation.
Bearish News
- Christie’s took its website offline due to a “cyberattack” by hackers days before the crucial May sales week in New York.
- Sales of works by young artists at Christie’s and Sotheby’s major auctions fell from $213.2 million in 2021 to $110.2 million in 2023.
- A website posing as the Van Gogh Museum was shut down after selling fake tickets and harvesting credit card information.
- AI tools have identified at least 40 counterfeit Monet and Renoir works on eBay, signaling a rise in fake masterpieces.
How to invest in Artwork right now:
Anybody else surprised Bezos’ most prized possession is a painting?
Vintage Autos
Bullish News
- The Tyrrell P34, the only six-wheeled car to enter an F1 race, is up for auction in Monaco.
- A 1973 BMW CSL once owned by Jamiroquai’s Jay Kay is up for auction for between £160,000 and £180,000.
- A collection of ultra-rare AMG Mercedes-Benz models is being sold on Bring a Trailer.
- The 1978 Monaco Grand Prix-winning Tyrrell-Cosworth 008 is on the block at Bonhams after being owned by Pink Floyd drummer Nick Mason.
- The first ultra-rare Aston Martin Valour, limited to just 110 examples, has been delivered to Canada.
Bearish News
- The Better Business Bureau warns that scammers target classic car and vintage 4×4 buyers with fake online listings.
- A 1972 Mercedes-Benz 450SL with a cracked windscreen stopped running mid-auction, forcing the seller to relist it as a project car for $6,100.
- A garage fire in Pahrump destroyed 11 classic cars undergoing restoration in a collapsing steel building.
- A New Jersey fire chief was charged with vandalizing a rare 1995 Nissan Nismo 270R, one of only 30 produced, by dumping rocks and gravel on it.
- A Denton County, Texas car auction lot had its second fire in six months, with 45 vehicles involved in the blaze.
How to invest in Vintage Autos right now:
Make sure your insurance covers fires.
Rare Coins
Bullish News
- A man found an 1808 ‘capped bust‘ half dollar coin at his grandmother’s home that could be worth up to $22,500.
- An 1800 ‘Draped Bust’ silver dollar in mint uncirculated condition can fetch up to $310,000.
- Archaeologists discovered a hoard of 170 silver coins worth $170,000 on the Swedish island of Visingsö.
- A 1776 Libertas Americana silver medal sold for $180,000 at Stack’s Bowers’ Richard Margolis session.
- An English family found over 1,000 17th-century gold and silver coins hidden beneath their kitchen floor, which sold for $75,900 at auction.
Bearish News
- A Michigan man filed a lawsuit against Bank of America, claiming over $3 million in rare coins went missing from his safe deposit box.
- Thieves stole $2-3 million in rare baseball cards before a collectors convention in Strongsville, Ohio.
- The 1797 “S-139” Large Cent tops the list of deceptive counterfeits seen since 2015, with nine examples documented.
- Numismatic crime has spiked as coin shows ramp up for the summer.
How to invest in Rare Coins right now:
Time to start ripping up the hardwood.
Farmland
Bullish News
- A Purdue University survey found farmers see energy production on their land as a key factor in raising land values.
- Gladstone Land’s existing farmland portfolio continues to perform as expected, reporting net income of $13.6 million for the quarter.
- Agscent, using NASA-licensed technology for methane measurement and diagnostics, won the Pitch In The Paddock competition at Beef2024.
- Officials broke ground on the National Center for Resilient and Regenerative Precision Agriculture, a proposed $160 million USDA research center.
- Bill Gates spent over $113 million purchasing about 20,000 acres of Nebraska farmland over the past six years.
Bearish News
- Farmer confidence hit rock bottom, with only 29% expecting farmland values to increase.
- Kentucky lost over 1.4 million acres of farmland in two decades, a 20% drop.
- US farmer sentiment hit a near two-year low in April, with the Current Condition Index falling to 83.
- The Purdue University-CME Group Ag Economy Barometer plunged 15 points to 99, its lowest point since June 2022.
- Agricultural incomes decreased in the first quarter across the Ninth District.
- For nearly 40 years, the USDA has distributed $11.18 billion in farm subsidies and disaster relief to over 10,000 recipients, some of whom neither work nor live on farms.
How to invest in Farmland right now:
I don’t live or work on a farm either. Where’s my check?
Luxury Goods
Bullish News
- Prada plans to invest €70-80 million annually to enhance operational efficiency and explore potential acquisitions.
- Hermès countered a lawsuit claiming that allegations of antitrust violations in Birkin bag sales are “far-fetched.”
- The secondhand luxury goods market is forecasted to reach $72.3 billion by 2032, expanding from $34.2 billion in 2023.
- Tmall Luxury Pavilion established the richest online hard luxury retail ecosystem in China, hosting over 200 premium and luxury brands.
- Luxury fashion brands have begun opening restaurants around the world to appeal to those who value experiences.
- Walmart has entered the luxury Ecommerce space.
Bearish News
- The value of Swiss watch exports fell by 16.1% in March compared to the same month last year.
- Salvatore Ferragamo’s first-quarter revenues fell 18.3% to £227 million, with a 19.3% decrease in the Asia Pacific region.
- Recent disclosures show Gucci’s wholesale revenue down 7% and Bottega Veneta’s dropping 14%.
- Burberry faces critical challenges; shares fell over 50% year-over-year with a profit warning issued early this year.
- Burglars broke into a Cape May jeweler and stole over $300,000 in designer handbags.
How to invest in Luxury Goods right now:
Nothing screams luxury quite like Walmart.
Wine, Tequila, and other Spirits
Bullish News
- San Diego County wineries reached a record $54.5 million in gross sales in 2023, an 11% increase.
- Fresno State’s Jordan College of Agricultural Sciences is adding a “Wine Business” degree to its viticulture program.
- Constellation Brands acquired Sea Smoke, a renowned Pinot Noir and Chardonnay estate in Santa Barbara County.
- Alternative wines saw growth, with 60% of sales in Germany, France, and the UK, favored by young, quality-focused drinkers.
Bearish News
- Spirits sales in the US fell by 2.7% in the year leading up to March 2024, with wine sales down 8.3%.
- Nearly every spirit category tracked by NABCA declined in value and volume in March compared to last year.
- The entire $55 billion California wine industry is experiencing a downturn, with wine consumption falling 8.7% in 2023.
- Connecticut legislators are considering allowing towns to ban mini liquor bottle sales due to litter concerns.
- Vintage Wine Estates extended its forbearance period to June 4, 2024, as it struggles with significant debt and profitability issues.
How to invest in Wine and Spirits right now:
Mini liquor bottle consumers are left with a choice: recycle or buy a bigger bottle.
Last chance to get in on our tequila SPV. Let me know if you’re interested.
Music and Film
Bullish News
- Music startup Mogul surpassed $100 million in tracked royalties in just three months since its February launch.
- Warner Music Group reported fiscal Q2 revenue of $1.5 billion, up 7% from a year ago.
- UMG artists returned to TikTok as the two parties struck a new licensing agreement following a three-month dispute.
- Tencent Music Entertainment unveiled their AI-powered “PDM” technology that can “predict the next hit song.”
- Apple Music launched the ‘Apple Music Partner Program‘ for labels and distributors, including premium data analytics tools.
- Spotify revealed UK-specific streaming royalties data, with royalties generated by UK artists exceeding £750 million in 2023.
Bearish News
- Spotify’s changes to its premium plans will result in artists earning $150 million less in US mechanical royalties over the next year.
- The US Supreme Court ruled against Warner Music in a copyright damages case.
- Universal Studios Japan experienced unusually low attendance during Golden Week.
- AMC Theatres reported a 6% decline in Q1 North American box office compared to 2023.
- Former president of the MGM Grand casino was sentenced to one year of probation for failing to report millions in wagers.
How to invest in Music and Film right now:
At a certain point artists will have to pay Spotify to stream their music.
Metals and Gems
Bullish News
- Silver’s market potential appears positive, with prices anticipated to rise toward $28.00.
- The Metals Company is developing the world’s largest and second-largest nickel projects through deep-sea mining.
- The platinum market faced its largest supply shortfall in 10 years in 2024.
- The World Bank’s metals and minerals price index rose 9% in April 2024.
- Chinese consumers have flocked to gold, sending prices to record highs above $2,400 per ounce.
- US Representative Alex Mooney reintroduced legislation proposing removing all federal income taxation from gold and silver coins and bullion.
Bearish News
- Most base metals slipped on Wednesday as a firmer US dollar made the greenback-priced commodity more expensive for buyers.
- South African mining’s contribution to GDP has fallen from 21% in 1980 to 7.5% in 2022.
- Chinese cobalt metal prices fell to an eight-year low on Wednesday, May 8.
- Bordeau Metals stopped operations due to a lawsuit over “deafening” noise.
- Mexico’s new aluminum tariffs disrupted supply chains, raising US Midwest premiums by 3.70%.
- Diamond giant De Beers slashed the price of its lab-grown rocks by nearly 40%, citing their plummeting wholesale prices.
How to invest in Metals and Gems right now:
Turns out lab-grown doesn’t rock after all.
Collectibles
Bullish News
- A collection of rare Pokémon cards from the late 1990s sold for over £55,000 at auction, over double the guide price.
- Fanatics Collectibles announced a multi-year trading card partnership with the English Premier League starting in 2025.
- Leaf Trading Cards became the exclusive licensee for Professional Bull Riding trading cards.
- Victor Wembanyama’s NBA Rookie of the Year card set a record for the highest Topps Now print run, with 113,777 copies sold in 72 hours.
- GreatCollections is offering a rare 18k gold TiffCoin by Tiffany & Co. in an unreserved auction on May 19.
Bearish News
- Over $2 million worth of vintage baseball cards went missing before a collectors convention in Strongsville, Ohio.
- A man attempted to steal over $30,000 worth of Pokémon cards from a Miami-Dade game store before being tackled by bystanders.
- A yakuza boss was arrested for stealing Pokémon cards worth $1,621 in Japan.
- Funko Inc. missed revenue estimates and widened its net loss in Q1 2024.
- A rare 1890 Enrico Marchetti cello, valued at about $250,000, was stolen from a Seattle home.
How to invest in Collectibles right now:
Don’t attempt a Pokémon robbery unless you’re prepared to get tackled.
Websites and Domains
Bullish News
- AI topped the keyword chart for March on Afternic, indicating strong demand for AI-related domains.
- Afnic reported a new all-time record for .FR domain name create operations in 2023, with a growth of 3.4%.
- DomainAgents CEO Ryan McKegney disclosed that his company brokered a three letter domain name for $2 million earlier this year.
- Squarespace saw a 27% increase in .com registrations in January 2024, reversing a downward trend since acquiring Google Domains.
Bearish News
- A massive network of fake shopping websites conned over 850,000 people in the US and Europe over the past three years.
- Veteran subtitle download site Subscene.com shut down after two decades online.
- Florida Attorney General Ashley Moody’s office shut down about 10 fake SunPass websites as a new toll scam targets commuters.
- Hackers linked to Chinese fraudsters targeted online shoppers and stole about $50 million from victims.
How to invest in Websites and Domains right now:
Florida investors, make sure you didn’t fall for the SunPass scams.
That’s all for this week
Cheers,
Wyatt
Disclosures
- We hold BTC, ETH, and a couple Star Wars Action figures in our ALTS 1 Fund.
- There are a couple of affiliate links above. If you click them, we may get a couple of bucks.