Category: Billion Dollar Companies

Swedish furniture retailing giant Ikea wants to turn rice straw from India into a renewable material source for its products. The concept should help reduce air pollution in one of the most polluted countries.

For more than two weeks now, India’s capital has been covered by a toxic fog that causes breathing problems and eye burn. The air quality improved for the first time in two weeks on Wednesday, when it went from ‘severe’ to ‘very poor’ and on Thursday to ‘poor’.

Ikea’s “Better Air Now” to Cut Down Pollution

One of the causes of dense smog is crop burning, a practice that Indian farmers use to get rid of the rice straw at the beginning of winter. Despite being banned to protect the air quality, farmers continue to use stubble burning to prepare the land for a new crop.

The Swedish company plans to buy the residue and use it to manufacture new products, as part of their “Better Air Now” initiative. Helene Davidsson, Sustainability Manager South Asia at IKEA Purchasing stated:

“We know that burning of rice crop residue is a major pollution source and with this initiative, we hope that will change. If we can find a way to make use of rice straw, it would become a valuable source for the farmers instead of being burnt, which in the end also would contribute to better air for people.”

The furniture retailer wants to have the first product prototypes made with rice straw by the end of this year. The company plans to sell rice straw-products in India during 2019 and 2020, then expand the concept to other markets.

9 of 10 Most Polluted Cities Are in India

India struggles to maintain its air quality, and crop burning is only a trigger for the toxic smog that covers the most crowded cities of the country. A study by the World Health Organization revealed that nine of the world’s ten most polluted cities are in India.

Delhi ranks 6th on the list at the moment, and crop burning is responsible for a quarter of the air pollution in this city. Other factors that pollute the air are vehicle emissions, industry, and a significant amount of smoke due to the firecrackers burned to celebrate Diwali.

This year, the Indian government decided to spend $230 million in 2018 and 2019 to prevent stubble burning. The money was intended to cover the costs of removing crops from fields in Punjab, Haryana and Uttar Pradesh, three states that border the capital.

Ikea is planning to contribute by buying crop residue from farmers. The retailer has opened its first Indian store in Hyderabad, in July 2018. The Swedish company plans a $1.53 billion investment in the local market, for opening 25 stores across the country.

Featured image from Shutterstock.

Trading platform eToro and its well-known senior analyst Mati Greenspan has published a comprehensive guide to fintech trading and investments subtitled “Building Wealth in the 21^st Century.”

Founded in 2006 and launching its social investment platform and innovative “Copy Trading” feature in 2010 eToro has seen significant growth to its user base.

By 2013, after a number of million-dollar funding rounds, eToro had 3 million registered users and by the end of 2017, 8 million investors had opened accounts with the platform. In 2016 eToro was tipped as a financial technology company to watch by the Financial Times.

eToro’s trading and investment products cover both stocks and cryptocurrencies combining contract for difference (CFD) derivatives for stocks and shares, with exchange-traded funds (ETFs), and cryptocurrency trading pairs.

The platform offers both new and professional investors an all-in-one route to online investing as well as the ability to view and follow what other investors on the platform are doing to increase their wealth.

Who is Mati Greenspan?

Along with the success of the eToro platform its chief analyst Greenspan has emerged as a key source of knowledge for investors and widely cited by investing and cryptocurrency news outlets, increasing eToro’s reputation in the trading space.

Greenspan’s grandfather was a self-made millionaire and investing was a dinner table topic for the analyst who began paper trading at the age of 13. He became hooked on day trading and says:

“You just have to see the patterns and trends, and when you win the prizes are in real money.”

Greenspan spends his entire life, including his spare time, analyzing these patterns and trends, and is keen to impart his knowledge to less experienced traders and investors:

“The financial sector represents about 10% of the world’s wealth…Why not have it accessible to the average guy?”

The new eToro guide has been co-authored by Sandy Fox, she has 35 years of investing experience and also comes from an investing family.

The Complete Guide to Fintech Trading and Investments

Of course, the eToro guide is written with the eToro platform in mind and as part of eToro’s marketing, but it’s also a useful standalone guide in many respects for non-eToro users and those considering getting into fintech or cryptocurrency investment.

eToro CEO and founder Yoni Assia says:

“We aim to disrupt the traditional trading industry by making online trading and investing available to anyone, anywhere. A key element to achieving this goal is promoting financial literacy.”

The guide begins by giving a history of fintech and introducing the basics of finance and investing.

“Investors know how to use money to make money.”

It covers the importance of research, how to research, and the basics of buying and selling:

“Careful research and preset stop losses can increase the chances for wealth building.”

It then goes into detail on how investors can build their knowledge to make better, informed, investment decisions.

“Smart investors and traders research, understand trends and use calculations to determine the best entry and exit points.”

eToro recommends diversifying across products, methods, and global markets to reduce risk, that way if one segment of your portfolio is struggling due to a market event, other areas should sustain your wealth and reduce the risk of complete losses.

It also recommends building a portfolio tailored to your end goal, whether that is a weekly income, a retirement fund, or simply the joy of beating the market.

“Since every kind of investment carries its own risk, you’ll need to figure out your risk tolerance. This is both an emotional and a financial decision.”

eToro has created a resource that covers the basics and ideologies, then goes in-depth on each type of investment available on the market and their mechanisms. It covers stocks, bonds, ETFs, CFDs, currencies, commodities, and cryptocurrencies as well as short-term and long-term options for investing or trading.

It also covers the eToro concept of social or Copy Trading and the strategies behind “copying” or learning from other market traders.

The guide concludes by summarizing the opportunity for investors the fintech revolution creates and how technology is changing how we think about money and even traditional stocks and shares.

“Even in the new fintech world, there are some constants. Traders need an investment plan and a trading strategy.”

In what is a useful, detailed and well-written resource, eToro warns of the risks and the potential benefits of trading and investing in the fintech markets.

“You can lose your capital. But you may also capture a portion of the vast wealth generated by the financial sector.”

The fintech, tech, and cryptocurrency trading markets are all incredibly volatile right now. Stocks in the big technology companies are rising and falling, global stock markets are fluctuating by the second, and cryptocurrencies have lost value but bulls expect the next boom. It’s this volatility that can give the most gains for savvy traders.

Featured image from Shutterstock.

Mark Zuckerberg, co-founder, and CEO of Facebook has allegedly asked his executive team to use Android phones instead of iPhones.

The New York Times reported that it all began when Apple’s CEO Tim Cook spoke about the privacy concerns surrounding Facebook in an MSNBC interview. He said that personal details of people can be used by advertisers and shouldn’t exist online. Apple, he added, considered privacy a ‘human right’ unlike applications (like Facebook) that violate privacy policies.

Last year, Facebook made $39.9 billion in advertising revenue. The company offers targeted advertising which helps advertisers display customized ads to a specific group of people.

If someone searches for something on Google, he/she will see ads related to the topic on social media websites. According to the statement made by Cook in March 2018, these tracking techniques are ‘creepy’.

Cook was also asked what he would have done in Zuckerberg’s position in the Cambridge Analytica scandal, to which he replied that he “wouldn’t be in this situation.”

The Majority in the US Prefer Androids Over iPhones

Zuckerberg was offended by these remarks and ordered his management team to stop using iPhones. Earlier in 2018, Statista reported that 54.5% of the U.S. population used Android’s operating system. Thus, he told his employees that Android had far more users than Apple.

However, Business Insider also published a survey that showed that 80% of US teenagers preferred iPhones. We’ll have to wait until next year to see whether this figure will tilt the balance in favor of Apple.

9 Executives Bid Goodbye to Facebook

2018 was a rough year for Facebook–as soon as news of the data scandal broke on the internet in March 2018, the company faced criticism from all over the world.

Since then, Zuckerberg has appeared in front of the US Congress and the EU Parliament. He is also set to answer questions raised by the UK and Canadian governments.

In the meantime, some notable names from the executive team quit their jobs. WhatsApp co-founder Jan Koum left the company one month after the data scandal was published.

Elliot Schrage, Communications and Public Policy’s Head, and Colin Stretch, General Counsel, announced their exit in June and July. They were followed by Alex Stamos, Chief Security Officer, Dan Rose, VP of Partnerships, Rachel Whetstone, VP of Communications, and Alex Hardiman, Head of News Products, in August.

Finally, Instagram co-founders Kevin Systrom and Mike Krieger and co-founder of Oculus Brendan Iribe joined the exodus in September and October.

Featured image from Shutterstock.

Tesla Inc. co-founder Elon Musk sure likes to create buzz and challenge authorities with his cutting-edge projects. The controversial billionaire is now facing a negative answer from Mexico’s Tequila Regulatory Council (CRT), after tweeting about his latest concept, Teslaquila.

Regulators aren’t banning the liquor, but they want to make sure that the new product complies with Mexican standards.

In October, Tesla Inc. filed a trademark for Teslaquila, for both distilled agave liquor and distilled blue agave liquor. The company also filed applications in Mexico, the European Union, and Jamaica.

April Fools’ Day Joke Comes True

It all started on April Fools’ Day when Musk published a photo on Twitter showing him passed out on a Model 3 and surrounded by “Teslaquila” bottles. What seemed like a joke generated a wave of enthusiasm from Tesla fans.

Elon was found passed out against a Tesla Model 3, surrounded by “Teslaquila” bottles, the tracks of dried tears still visible on his cheeks.

This is not a forward-looking statement, because, obviously, what’s the point?

Happy New Month! pic.twitter.com/YcouvFz6Y1

— Elon Musk (@elonmusk) April 1, 2018

In less than seven months, Musk turned a joke into reality. In October, he used social media to announce the new concept.

Teslaquila coming soon … https://t.co/AtoVGOtvVR

— Elon Musk (@elonmusk) October 12, 2018

Tesla Is Ready to Comply with Requirements

The initial reaction from the Mexican authorities wasn’t good for business. Mexico’s Tequila Regulatory Council (CRT) released a statement to express its concerns about a liquor similar to tequila that would be produced by Tesla Inc.

The regulators explain in the statement:

“The name ‘Teslaquila’ evokes the word Tequila… [and] Tequila is a protected word. If it [Tesla Inc.] wants to make Teslaquila viable as a tequila it would have to associate itself with an authorized tequila producer, comply with certain standards and request authorization from Mexico’s Industrial Property Institute.”

However, the worries have little grounding since the company will seek the CRT’s approval before producing the liquor. A Tesla spokesperson said that Teslaquila will comply with all standards, and it will be manufactured in the state of Jalisco, Mexico.

The $4.6-Billion Industry Attracts Many Celebrities

Elon Musk isn’t the first to take advantage of the business opportunities offered by the tequila industry. Actors, singers, and entertainers have been making money from producing and selling tequila for years.

George Clooney, Carlos Santana, Adam Levine, Justin Timberlake, and P. Diddy are just some of the celebrities that put their names on tequila brands.

The tequila market was valued at $4.6 billion in 2017. It’s expected to top $6.36 billion by 2025.

Featured image from CNET.

Walmart Inc., one of the largest companies in the world by market revenue, has had its hopes for further control over the Indian online retail market dealt a massive blow following the resignation of Binny Bansal, the co-founder and Chief Executive Officer of Flipkart Group.

According to a joint statement by Flipkart and Walmart, Bansal was forced to resign on Tuesday after an independent investigation was carried out on behalf of both companies into concerns regarding:

“serious personal misconduct.”

The statement went on to say that while there was no evidence found to corroborate the allegations that had been leveled against Bansal, it showed other lapses in judgment, especially related to how he handled the entire station.

The news comes as a major blow to Walmart, who will be losing a key management staff of the recently acquired e-commerce giant. Walmart purchased a 77% stake in Flipkart back in May for $16 billion with the aim of owning a large stake in the Indian e-commerce market, which has seen steady growth in the past few years.

The deal seemed to be lucrative for Walmart especially, as Flipkart had been able to account for about 40% of the online retail market in India when the deal was signed.

However, six months on from the deal, there is trouble in paradise. In October, Walmart announced to its shareholders that the deal to acquire Flipkart was going to constitute a $740 million deduction from their quarterly profit. The sudden departure of Bansal is another problem Walmart didn’t expect when it acquired the Indian e-commerce giant.

Nevertheless, Walmart’s commitment to Flipkart’s growth seems to be unwavering. The statement confirmed that in the wake of Bansal’s resignation, that Kalyan Krishnamurthy would continue to serve as the CEO of Flipkart. It also affirms that the leadership of Flipkart is looking to evolve into a public-traded company in the future.

Back in the US, Walmart continues to innovate and lead the industry with new processes and systems that promote productivity in its stores. The retail giant recently introduced a new scheduling system, which they say will provide a greater degree of flexibility and consistency to their associates. The scheduling system is set to launch in all Walmart stores at the end of November.

Featured image from Zee News India.

Koo Kwang-mo is LG Group’s new Chairman, after inheriting an 8.8% stake in the company, following the death of his adopted father and former Chairman Koo Boon-moo in May 2018.

Inheriting so much wealth would have made him a billionaire, except for one little snag—taxes. A whopping 50% is due to the authorities as the death tax, which the family plans to pay in full over a period of five years.

LG Corp. is South Korea’s largest conglomerate with investments in the electronics, car battery, and phone display business. The company is one of South Korea’s most powerful family-run multinationals.

Death taxes in South Korea vary but they can be as high as 50% when inheritance exceeds $2.7 million. There is an additional 20% in situations where the shares passed down are owned by the firm’s largest shareholder.

At the current rate, Koo Kwang-mo could be looking at a tax bill of more than $630 million alone for his new status. But he’s not alone–his sisters also got a 2.5% stake in the LG Group which could see the Kwang-mo family cough up over $790 million (or more than 900 billion won).

Koo Kwang-mo Has Payment Options Available

While it remains unclear how Koo will afford the payment, a spokesman for the company told Bloomberg that the Korean tax authorities would decide the final figure to be remitted as taxes.

Financing medium expected to be used by the Chairman of LG Corp. includes loan financing using his stake in the business as collateral, raising dividends, and selling some of the group’s principal subsidiaries.

Evading tax laws by the elites is common in South Korea, which makes the Kwang-mo family’s acceptance to pay the tax bill in full a rarity. LG’s hefty tax bill is the latest in what could be a rain of inheritance bills to be paid by South Korea’s conglomerates planning succession for their heirs.

Samsung Electronics Co. Chairman Lee Kun-hee, whose holdings at the company are worth around $16 billion would probably not be thrilled to see a massive chunk of that money going to the tax man when he passes his holdings to his son. But, according to local law, that’s precisely what could happen.

Featured image from Nikkei Asian Review.

Japanese tech giant SoftBank Group Corp. is preparing the country’s largest initial public offering (IPO). Founder Masayoshi Son wants to raise $21.1 billion (2.4 trillion yen) by selling 1.6 billion shares of a new mobile division at 1,500 yen apiece. The company is ready for an overallotment with an additional 160 million shares, valued at $2.1 billion.

SoftBank Group Corp. announced the approval of listing on November 12:

“SBG [SoftBank Group Corp.] announces that it has decided on the disposal of a portion of SB [SoftBank Corp.] shares held by SoftBank Group Japan Corporation, a wholly owned subsidiary of SBG.”

The IPO price range will be announced at the end of November. However, investors will know the final price on December 10. The new entity is expected to start trading on December 19.

Building a Global Investment Company

The IPO will mark a new era for SoftBank, a company that aims to reposition itself in the market. Chief Executive Masayoshi Son is ready to transform its mobile phone network service into one of the world’s biggest players.

SoftBank has already invested in a significant number of small startups, as well as in giants like Uber Technologies, Didi Chuxing, and Alibaba Group.

Masayoshi Son has the reputation of being a tech visionary. The SoftBank founder and CEO is the creator of the $100 Billion Vision Fund, which has been buying large stakes in fast-growing tech companies. The entrepreneur also plans to raise similar funds every few years that invest around $50 billion a year in tech startups.

SoftBank hopes to lure investors with a dividend payout ratio of about 85 percent of net income.

A Challenging Year for SoftBank

SoftBank’s reposition comes at a time when the company has to rethink its strategy both in the Japanese and international markets.

Masayoshi Son’s connections with Saudi Arabia’s Crown Prince Mohammad bin Salman have generated contradictory feelings among investors. Bin Salman also invested almost $45 billion in the Vision Fund, which has lead to speculation about how many investors would pull back after the killing of journalist Jamal Khashoggi.

Besides its diplomatic problems, the Japanese tech giant is also handling challenges at home. The company needs to cut down mobile bills to comply with new government requests. The authorities expect mobile carriers to lower prices by 40%.

SoftBank has almost 34 million wireless subscribers in Japan. The company forecasts 700 billion yen ($6.1 billion) in annual operating profit across all its telecom operations.

Featured image from Shutterstock.

Even if you don’t use it, you’ve probably heard of SAP, the enterprise software company that allows businesses to track customer interactions. Now the German-based SAP becomes the next large name in legacy enterprise software to acquire a more agile business to help adjust their market offering.

SAP (Systems, Applications and Products) is best-known for its Enterprise Resource Planning (ERP) and data management programs and is Germany’s largest company in terms of market value. As it migrates its traditional on-premises services to the cloud, the acquisition of Qualtrics should help them achieve their goal of being the number one-stop solution for businesses.

US Company Qualtrics Was About to Go Public

SAP snatched up the US-based company Qualtrics just as it was about to go public for a seemingly inflated total of $8 billion, a decision that has been approved by both company shareholders and boards of directors.

SAP Chief Executive Bill McDermott said that the acquisition would allow the company to combine its operational data with Qualtrics’ customer experience data to allow customers to get insights and feedback in real time.

SAP is just the latest in a growing group of legacy software providers buying up younger companies in the hopes of adapting their product to a changing market. Just two weeks ago, IBM bought Red Hat for an eye-watering $34 billion, the biggest acquisition in the tech industry this year. And Microsoft also snatched up GitHub for $7.5 billion.

What Does SAP Want with Qualtrics Anyway?

Qualtrics sells experience management (otherwise known as customer research and surveys) to large companies such as Coca-Cola, Walt Disney, and BMW. One of its main competitors is SurveyMonkey which went public in September for a lower-than-expected valuation of $1.25 billion.

In fact, Qualtrics was valued at just $2.5 billion in its last private funding round in April 2017. The all-cash offer from SAP is also well above the $4.5 billion that Qualtrics was expected to reach for its upcoming IPO. So, why is SAP paying such an exorbitant amount for a company with half its value?

It could be that the company is looking to mask slower organic growth or their own cloud model that’s failing to scale. Either way, analyst at Mirabaud, Neil Campling told the FT:

“It’s an extremely high multiple whichever way you look at it.”

Featured image from Shutterstock.

Singles’ Day 2018 sales reached $10 billion in the first hour. It’s Jack Ma’s last Singles’ Day while leading Alibaba but the shopping events success probably won’t impact his overall wealth.

Singles’ Day in China is as, as the name suggests, celebrated by Chinese single and often younger residents. It has also morphed into the largest offline and online shopping day in the world usually netting its largest benefactor, Alibaba, billions of dollars in sale revenue.

In 2017, Alibaba grossed around $24.3 billion worth of consumer spending. This year, Singles’ Day already achieved $10 billion in the first hour alone–and $3 billion in the first five minutes.

Jack Ma’s Last Singles’ Day

Alibaba has this year offered 180,000 items in its online sale. It will be the e-commerce giant’s last event while China’s richest man, Jack Ma, is chairman of Alibaba. Ma, the founder of Alibaba, announced his retirement as chairman in September 2018. Alibaba Group CEO Daniel Zhang will replace Ma in September 2019.

Zhang, after 11 years with Alibaba, has been tipped the “architect” of Singles’ Day. In a letter announcing his retirement and replacement Ma wrote of Zhang:

“Teachers always want their students to exceed them, so the responsible thing to do for me and the company to do is to let younger, more talented people take over in leadership roles so that they inherit our mission ‘to make it easy to do business anywhere.’”

Ma, worth an estimated $39 billion thanks to Alibaba added:

“The one thing I can promise everyone is this: Alibaba was never about Jack Ma, but Jack Ma will forever belong to Alibaba.”

With competition from other e-commerce players in China like JD.com and the impact of a stalling economy in China and international trade concerns, Alibaba is still hoping to achieve record final results.

This year Alibaba’s total sales revenue will also include income from offline acquisitions including shopping malls, convenience stores, and food delivery businesses.

Zhang said in October 2018:

“Singles’ Day has now become a stage for Alibaba to showcase its capabilities across all its platforms.”

Alibaba is expected to tot up half a billion website visitors with Zhang predicting:

“We think 1 billion packages will become a daily event in the future.”

Despite Record Success Alibaba’s Share Price Unlikely to Rise

The latest indications of Alibaba’s revenue for Singles’ Day report that, with eight hours still remaining of the event, Alibaba’s sales had already surpassed last years $24.3 billion.

The success of Singles’ Day is taken as a measure of consumer spending and retail health in China, the world’s second-largest economy.

Despite the event’s success, some predict it may not add anything at all to Jack Ma’s overall wealth, which has already declined this year as China’s economy struggles and retail sales in China fall.

Alibaba’s share price has, surprisingly, historically not benefitted from Singles’ Day reported results, with Alibaba’s share price having fallen on or after every Singles Day since 2014. As of Friday, Alibaba’s NYSE stocks are down just over 4%. Alibaba’s overall share value has fallen 16% so far across 2018.

Things have gone from bad to worse for Europe’s most hated low-cost airline Ryanair and chief executive Michael O’Leary. The tight-fisted Irish man is known for pioneering the low-cost airline movement. But also for making passengers travel like sardines with minimal luggage and maximum discomfort. He even proposed a move to make them pay for using the restroom onboard (which turned out to be illegal).

Now O’Leary is left positively fuming after the company’s latest gaffe which sees them pay the French airport of Bordeaux some €525,000 ($595 million) in return for an impounded jet.

Low-Cost and High Penalties

Yet over the years, it isn’t just Ryanair’s passengers who have suffered at the hands of O’Leary and his cost-cutting policies. The ruling by the European Commission to pay the funds to recover the jet (in which 150 London-bound passengers were forced off as the airport seized it) was just one of seven rulings over illegal operations by Ryanair. over illegal arrangements at local airports including Cagliari, Altenburg, and Klagenfurt.

The airline was forced to pay some €23.7 million ($26.9 million) over the unfair competitive advantage it had arranged with airports across Europe.

Ryanair employees have been having a bad time lately as well, staging strikes over pay and working conditions. Six employees were also recently fired after being pictured sleeping on the floor in a Ryanair office in Spain.

The Cases Against Ryanair Just Keep Piling Up

As if a €23.7-million fine, half a million for an impounded jet, dissatisfied staff and customers weren’t enough, Ryanair’s woes are just getting started. Italy’s antitrust agency has opened up a probe against the airline’s new hand luggage policy. The policy means that if you don’t pay for a premium service you can pretty much carry nothing on board, not even a laptop.

Moreover, the airline and chief exec O’Learly are being sued by a New York shareholder who claims that the share price was inflated by O’Leary and his promise of managing labor relations and keeping costs down.

Ryanair has also recently been the subject of a high-profile racial case against an elderly passenger in which a customer was filmed hurling abuse.

The company reported a 9% drop in pre-tax profit to €1.3 billion last month.

Featured image from Shutterstock.