Hello and welcome to Alts Cafe
It was a banging week for Altea members. Check out the update below.
Highlights from the full issue:
- Macro: “no signs of stagflation”
- Real Estate: San Antonio is heating up
- Startups: Peloton’s CEO stepped down
- Private Credit: A massive Q1 for fundraising
- Crypto: Bitcoin sank to the lowest level since February
- NFTs: Casio launched an NFT collection
- Art: The Global Art Market passed pre-pandemic levels
- Vintage Autos: A 1938 Bugatti sold for a record $6.6 million
- Coins: France returned over 8,500 ancient coins to Turkey
- Farmland: Target’s investment in sustainable cotton
- Luxury: Miu Miu had an impressive Q1
- Wine, Tequila, and Spirits: New Zealand wine is booming
- Film & Music: UMG and TikTok signed a licensing deal
- Precious Metals: Pandora reported an 18% sales increase
- Collectibles: Original Harry Potter Cover to sell for $600,000
- Websites: $84 million in domain name sales for Escrow
Let’s go.
Wyatt
Table of Contents
Macro View
Bullish News
- Fed Chair Jerome Powell stated the economy shows no signs of stagflation, with strong growth allowing for steady rates.
- The number of Americans applying for unemployment benefits remained at a historically low 208,000 last week.
- The OECD improved Brazil’s GDP growth forecast for 2024 from 1.2% to 1.9%.
- The German economy skirted a recession, growing 0.2% in Q1 2024 thanks to construction and exports.
- Seasonally adjusted GDP increased by 0.3% in both the euro area and the EU in Q1 2024 compared to the previous quarter.
Bearish News
- The Federal Reserve emphasized on Wednesday that rates will stay at a two-decade peak until inflation slows.
- Barclays’ macro trading revenues declined 21% year-over-year in Q1.
- The IMF warned of risks from China’s property sector correction and trade frictions despite raising its 2024 growth forecast for Asia to 4.5%.
- Canada’s economic growth missed estimates in February, boosting the chances of a rate cut.
- Starbucks cut its annual sales forecast after reporting a fall in same-store sales for the first time in nearly three years.
What are the odds?
Investors have given up on a rate cut this summer and have kicked the can down the road to November.
Get $25 to play around with using this link.
What are we doing?
Altea Highlights
Check out the full roundup.
ALTS 1 Fund news
Alts I is open to new accredited investors for a limited time. Express interest.
Real Estate
Bullish News
- The Treasury raised the foreign ownership threshold for the “look-through rule” in real estate funds from 25% to 50%.
- Dallas-based real estate fintech platform Backflip raised $15 million in Series A funding, led by FirstMark Capital.
- The San Antonio housing market in March 2024 saw a 3% increase in home sales compared to the previous year.
- The Columbus housing market in March 2024 favored sellers, with the median price up 8.4% year-over-year.
- Economists overwhelmingly say that the housing market isn’t going to crash, with mortgage rates expected to fall this year.
- Commercial real estate owners expect improved insurance conditions in early 2024, with non-CAT assets expecting flat to 10% renewal rate increases.
Bearish News
- Real estate scams surged in 2023, with the FBI receiving 9,521 complaints amounting to $145 million in losses.
- HGTV star Charles “Todd” Hill was sentenced to jail for real estate fraud and ordered to pay $9.4 million in restitution.
- Insurance premiums increased 33.8% from 2018 to 2023.
- Treasury Secretary Janet Yellen said rising mortgage rates make home ownership “almost impossible” for first-time buyers.
- Fortress Investment Group launched a $548 million foreclosure, one of the largest ever, against Cohen Brothers’ real estate portfolio.
- The real estate sector needs $1.7 trillion annually until 2050 to meet net-zero targets, with 20% of portfolios at risk of becoming stranded assets.
- Inflation fears keep mortgage rates high, with loan applications down 2.3%.
How to invest in real estate right now:
How long must I live in San Antonio before I can wear a cowboy hat?
Startups
Bullish News
- African climate tech startups raised more than $3.4 billion from the private sector since 2019.
- Canada’s Start-up Visa Program increased the likelihood of US immigrants starting companies there by 0.048 points from a 0.069% baseline.
- Permira acquired a majority stake in digital fraud detection company BioCatch in a $1.3 billion deal.
- Foley & Lardner LLP represented NEA as the lead investor in the $33 million Series B for newsletter platform startup beehiiv.
- Y Combinator’s online founder-matching tool helped medical records AI startup Hona land $3 million in seed funding.
- General Catalyst reportedly raised almost $6 billion for technology startups.
Bearish News
- Many founders lost their startups after joining Newchip, an accelerator that went bankrupt and auctioned off nearly $500 million in warrants.
- ComplYant, a tax-compliance startup that raised over $10 million, abruptly shut down last year, leaving employees without severance pay.
- Peloton CEO Barry McCarthy stepped down.
- CISA warned of a GitLab password reset flaw being exploited, potentially letting attackers steal data.
- Prudential is shutting down Assurance IQ, the insurtech startup it acquired for $2.35 billion in 2019.
How to invest in startups right now:
Peloton is going downhill fast, much like a real bike.
Private Equity and Private Credit
Bullish News
- The PE industry is showing optimism for 2024, with 60% of executives expecting an improvement in deal activity.
- HighVista Strategies closed its oversubscribed PE Fund X with $675 million, targeting small private companies with enterprise values under $150 million.
- M&A activity in 2023 remained at elevated levels, with PE driving high transaction volume.
- Leveraged buyout activity in the US has reached its highest level since Q2 2022, creating opportunities for PC.
- British FinTech SumUp announced plans to expand after securing a $1.6 billion PC loan.
Bearish News
- Notre Dame’s endowment lagged public markets in 2023, returning 1.32%, with its 48.3% PE allocation dragging returns.
- Indonesia’s P2P lending sector expects slower growth of 5-7% this year due to stricter regulations.
- Wheelchair users face long repair times after PE firms Numotion and National Seating & Mobility acquired wheelchair makers and repair shops.
- PC fundraising hit $30.6 billion in Q1 2024, the lowest since 2020.
- The Alaska Permanent Fund has begun reconsidering its $15 billion PE allocation, reduced from 19% to 15% in 2023.
- Launches of multi-strategy hedge funds tumbled to under 10% of all new funds in Q1 2024, down from 25% in Q4 2023.
How to invest in PE and Private Credit right now:
Wheelchair repair shops need to ramp up production.
Crypto
Bullish News
- Michael Saylor’s Bitcoin investment paid off this year, earning $400 million through daily sales of MicroStrategy shares.
- Matthew Homer, ex-senior crypto superintendent at the New York Department of Financial Services, raised $5.1 million for his crypto-focused venture firm.
- BlackRock led a $47 million investment in Securitize, deepening its commitment to crypto.
- Bitbuy acquired Bitstamp’s Canadian customers, expanding to 1.75 million users and $1.5 billion CAD in assets.
- Pantera Capital invested in The Open Network blockchain, the 10th largest cryptocurrency with a $16.8 billion market cap.
Bearish News
- Bitcoin sank to the lowest level since February on Wednesday as the crypto market dropped 9%.
- The DOJ charged “Bitcoin Jesus” Roger Ver with $48 million in tax fraud for allegedly evading taxes on 131,000 Bitcoin.
- Binance founder Changpeng Zhao was sentenced to four months in prison after pleading guilty to money-laundering.
- Victoria Jacobs was sentenced to 18 years for funding terrorism by using crypto to send financial support to groups in Syria.
How to invest in Crypto right now:
Lesson learned: don’t fund terrorism.
NFTs
Bullish News
- Casio launched an exclusive NFT collection for its 50th anniversary.
- A rare CryptoPunk NFT, Punk #635, sold for over $12 million, making it one of the most expensive Punks.
- Bitcoin and Solana NFT markets recently registered record highs in daily active traders.
- DTX Exchange, a rising star in the presale ecosystem, is projected to surge by 15,000%.
- Moonbirds NFTs had a great week, defying copyright criticisms.
Bearish News
- NFT sales dropped by 30% in April, with the number of active NFT buyers falling by 51.88%.
- Ethereum ended April 2024 with its weakest month of the year, recording just $241 million in NFT sales.
- Yuga Labs, the company behind Bored Ape Yacht Club NFTs, announced layoffs, admitting that the company has “lost its way.”
How to invest in NFTs right now:
The Casio project is one to watch [Ed note: sorry]
Artwork
Bullish News
- The Global Art Market passed the 2019 pre-pandemic levels to $65 billion on 39.4 million transactions, up 4% over 2022.
- Sotheby’s launched a $700 million art-secured loan securitization program.
- Christie’s could sell a Vincent van Gogh painting for $35 million during its 20th Century Evening Sale on May 16.
- Duke University researchers developed a laser microscopy technique that could offer early detection for artwork at risk of fading or discoloration.
- Sotheby’s will auction Claude Monet’s Meules à Giverny (1893) on May 15, estimated to sell for more than $30 million.
Bearish News
- British museums are urged to charge fees as funding dropped 36.7% since 2009.
- Sotheby’s has seen a significant shift towards private sales as fewer people are willing to sell in the secondary auction market.
- The art market’s value fell 10% from 2022 to 2023 as museums struggle to engage the next generation of art collectors.
- A suspect in a national art theft ring, involved in stealing a Warhol, awaits sentencing in prison for violating release conditions.
How to invest in Artwork right now:
You’d think lasers would be the cause of fading artwork, not a method of avoiding it.
Vintage Autos
Bullish News
- The 1938 Bugatti Type 57C Aravis ‘Special Cabriolet‘ sold for a record $6.6 million at the Mullin Collection Auction.
- Pharrell Williams’s Joopiter is launching “Joyride,” its first auto sale, featuring rare vehicles like a 1990 Lancia Delta Integrale, expected to fetch up to $100,000.
- Joe Basil Chevrolet opened Basil Classic Cars, a new dealership dedicated to classic cars in Western New York.
- Five Buick Regal Grand Nationals are up for auction at Mecum’s 37th Spring Classic, with an average selling price of $47,700.
- A rare 1990 BMW M3 Sport Evolution is up for auction on Bring a Trailer, with recent sales exceeding $180,000.
Bearish News
- A man was arrested for stealing a vintage car from a Dania Beach liquor store using a tow truck.
- A 45-year-old Sardinian man was reported for an online scam involving “free” vintage car spare parts.
- A former Indiana sheriff was accused of using emergency medical service funds to buy six classic cars.
How to invest in Vintage Autos right now:
Pharell Williams has made his entrance into the auto market.
Rare Coins
Bullish News
- A 1976-S Bicentennial Silver Quarter sold for $19,200 at auction, with seven others selling for over $1,000.
- A bill was introduced to facilitate the lawful trade in ancient, medieval, and early modern coins with US partners in Europe.
- An exceptional example of a highly collectible Roman denarius commemorating the opening of the Colosseum will be sold at Baldwin’s Ancient Coin Sale.
- Heritage’s May 9 Platinum Session features Matte Proof gold coins, produced at the Philadelphia Mint from 1908 to 1915.
- France returned more than 8,500 ancient coins to Turkey, seized as illegally imported and valued at over $1.6 million.
Bearish News
- A FedEx courier was charged with felony and misdemeanor theft for stealing nearly $140,000 worth of rare coins from packages.
- Charges were dropped against a Casper coin dealer accused of faking the theft of a $100,000 coin collection.
- A second person was arrested in connection with the death of an antique shop owner in Wheat Ridge, Colorado.
- A Connecticut man pleaded guilty to fraudulently buying nearly $200,000 worth of gold coins with bad checks and selling them to pawn shops.
How to invest in Rare Coins right now:
Might be time to bring back carrier pigeons for coin shipments.
Farmland
Bullish News
- Farmland Partners Inc. reported strong Q1 2024 results, with AFFO of $2.8 million, the highest first quarter AFFO in company history.
- Chatham County, North Carolina approved farmland preservation grants for the conservation of 287 acres.
- Brands like Target and Ralph Lauren have invested in sustainable cotton through regenerative practices like cover cropping, no-till, and crop rotation.
- Farmers National Company reported that overall farmland demand remains strong.
- Minnesota farmer Bob Worth has found success with Pivot Bio’s biological nitrogen products, seeing yield benefits while meeting conservation requirements.
Bearish News
- The US House Agriculture Committee discussed threats from China’s acquisition of 384,000 acres of US farmland, valued at over $2 billion.
- The Southeastern Colorado Water Conservancy District claimed Aurora’s $80.4 million farm and water rights purchase breaches a prior agreement.
- A recent study confirmed farmers’ concerns about increasing expenses and declining prices.
- Solar development is risking some of America’s most productive farmland as the industry pushes into the Midwest.
- A Reuters analysis found that a renewable energy boom is damaging America’s richest soils, with 76.2 million fewer acres in farms than in 1997.
- The cost to produce corn and soybeans in Illinois reached record highs in 2023.
How to invest in Farmland right now:
Sustainable cotton is on the rise.
Luxury Goods
Bullish News
- Miu Miu grew by 89% in Q1 of this fiscal year.
- Arta launched valuables insurance in partnership with Chubb, already protecting over $500 million worth of collectibles while in transit.
- The luxury market is projected to grow by 27.8% between 2024 and 2028.
- LVMH allocated $2.1 billion last year toward acquiring properties in Paris before the Olympic games kick off.
- Burberry Group shares inched up 0.70% last Thursday, outperforming the market.
- Pharrell Williams launched the ‘Titan’ jewelry collection with Tiffany & Co., starting at $3,500.
Bearish News
- Federal agents seized $2 billion worth of fake luxury items last year, with counterfeit goods representing 2.5% of global trade.
- Luxury watch secondary market prices dropped about 40% from 2022 highs.
- Mulberry’s full-year revenue is down by 4%, with its share price falling around 30% in the last year.
- China’s luxury market is recovering slowly, with growth expected to drop to single digits in 2024 from 12% last year.
- Since 2019, prices for personal luxury goods in Europe have risen 52%.
How to invest in Luxury Goods right now:
Who knew federal agents had such a keen eye for fake luxury?
Wine, Tequila, and other Spirits
Bullish News
- BAXUS raised $5 million from Multicoin Capital to enhance its vaulting technologies for its collectible spirits marketplace.
- Unicorn, a tech-enabled platform for spirits and wine collectors, raised $5.8 million in a seed funding round.
- Beam Suntory has rebranded as Suntory Global Spirits, marking its growth from $2.5 billion to $5.5 billion since its 2014 acquisition by Suntory Holding.
- The New Zealand wine market is poised to reach $1.7 billion by 2030.
Bearish News
- Non-alcohol product consumption rose by 5% in 2023.
- Whisky cask fraud could seriously damage the reputation of Scotch whisky, with issues documented since the 1990s.
- A Montana Distillery filed for Chapter 11 bankruptcy, listing up to $50,000 in assets and $500,000 to $1 million in liabilities.
- A Beijing fraudster was sentenced to 5 years for faking Petrus and Lafite wines with an estimated market value exceeding $51,086.
- Napa Valley wineries launched a revolt against ‘abusive‘ county regulations, with one vineyard fined $1 million for overproduction.
- New York lawmakers want to expand direct shipping of liquor, but addiction recovery advocates argue it will negatively impact public health.
How to invest in Wine and Spirits right now:
Last chance to get in on our tequila SPV. Let me know if you’re interested.
Music and Film
Bullish News
- Sony Pictures Entertainment and Apollo Global Management made a $26 billion all-cash buyout offer for Paramount Global.
- Universal Music Group and TikTok signed a new licensing deal, promising better pay for UMG’s artists and songwriters.
- Spain’s Canary Islands scrapped a prior $53.5 million cap on total annual tax incentives tapped by movies and series shooting in the archipelago.
Bearish News
- Disney’s movie division lost money as films like Wish, The Marvels, and Indiana Jones underperformed at the box office.
- Warner Music Group’s CEO backed a US Senate bill to crack down on AI deepfakes after unauthorized AI-generated tracks surfaced.
- Warner Bros. Discovery’s stock hit an all-time low on Tuesday, losing roughly 70% of its value since April 2022.
How to invest in Music and Film right now:
Better pay is on the way for UMG artists.
Metals and Gems
Bullish News
- In 2023, 30.8% of global silver was produced as a by-product of lead and zinc mining—the largest source of silver that year.
- The Biden administration announced $3 billion in federal funding to help all 50 states remove lead pipes from their drinking water systems.
- Pandora, the world’s largest jewelry maker, reported an 18% annual sales increase as demand for lab-grown diamonds booms.
- Australian billionaire Gina Rinehart’s Hancock Prospecting took a 5.3% stake in US rare-earths producer MP Materials.
- New Australian technology aims to recover up to $40 million in valuable metals from contaminated sites in Port Pirie.
- Researchers at the Department of Energy’s Pacific Northwest National Laboratory found a way to recover critical metals from e-scrap.
Bearish News
- The US and UK ban on Russian metals could lead to a split between the LME and CME markets.
- Scammers stole more than $3.4 billion from Americans over 60 in 2023, an 11% increase from the previous year.
- Boston business owner Claudio Poles was charged with filing false tax returns after buying over $10 million in gold and silver bars to avoid taxes.
- India’s gold demand in 2024 could fall to a four-year low of 700-800 metric tons due to rising prices.
- More than 70% of copper, cobalt, and lithium production could face significant drought risk by 2050 under a high emissions scenario.
How to invest in Metals and Gems right now:
Led pipes are out!
Collectibles
Bullish News
- The original cover art for “Harry Potter and the Philosopher’s Stone” is expected to set an auction record next month, with estimates up to $600,000.
- eBay unveiled rare Star Wars collectibles curated by actress Billie Lourd for May the 4th.
- Caitlin Clark’s first professional trading card from Panini’s 2024 Instant WNBA Draft Night series sold for $10,000.
- Rich Penn, renowned Iowa auction company CEO and antique advertising specialist, joined Morphy Auctions as Market Development Officer.
- Prague was named the host city for the XXVIII World Olympic Collectors’ Fair in 2025.
Bearish News
- Fanatics faced widespread accusations that Topps was feeding “loaded” sports card boxes to streamers on their in-house network.
- Retro video game prices in Japan, once a haven for collectors, have risen significantly post-pandemic.
How to invest in Collectibles right now:
See you all in Prague.
Websites and Domains
Bullish News
- Radix’s premium domain sales totaled $4.8 million in H2 2023, a 28% year-over-year increase, with ‘betting.online’ selling for $400,000.
- LabHost, one of the world’s largest fraud websites, was seized and shut down, impacting at least 40,000 phishing domains.
- Escrow.com handled $84 million in domain name and website transactions in Q1 2024.
- Online grocery sales are projected to increase at a CAGR of 4.5% over the next five years.
Bearish News
- Institutional investors in Wix.com saw a $297 million decrease in market cap last week.
- Taylor Swift filed cybersquatting claims to take control of infringing domain names, marking her first use of the UDRP.
- A Chicago IP firm sued again over attorney impersonation.
- A study revealed high levels of USPS phishing, with illegitimate domains attracting nearly as much or more traffic than legitimate ones.
- Chinese researchers found security lapses in nearly 14,000 government websites, citing missing DNS configurations and outdated software.
- FRITZ!Box faces issues as ‘fritz.box,’ historically an internal login, now directs users to an external site due to ‘.box’ becoming a top-level domain.
How to invest in Websites and Domains right now:
Online groceries are nice, but I’ll miss the cart with the sticky wheel.
That’s all for this week
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.
