The EU is expected to put forth a new regulation fining internet platforms who fail to remove any material considered threatening from their site. Both large and small platforms will be mandated to adequately detect and remove terror propaganda beginning as early as September 2019, subjecting the likes of Facebook and Google to what are still unclear parameters for acceptable content. Details of the regulation will likely follow guidelines set forth by the EU in March, though online publishers have been advised to seek ongoing clarity of the regulations to avoid over- or under-removal of content.
The SaaS App world this week saw Tencent Music, music branch of China-based tech giant Tencent and owner of the four largest music apps in the country, IPO on the NYSE. In one of the largest public listings by a Chinese company on the US market since Alibaba in 2014 (which raised $20 billion), Tencent listed at $13 per share and raised nearly $1.1 billion in its first day of trading. Though listed at the bottom of the initial share price range ($13-$15), the offering generated an implied valuation of $21.3 billion for Tencent Music, who as of Q2’18 has more than 800 million monthly active users.
In e-commerce news, Amazon has experienced a recent influx of scams targeting its platform sellers, the drivers of a majority of the company’s revenue. Recent weeks saw Amazon fire several employees facing suspicions of bribery and data leaks, as well as delete thousands of suspected reviews and restrict access to avenues that allow manipulation of competitors’ product rankings and information. Amazon sellers should audit their listings to ensure no foul play has affected their descriptions, images, categories or rankings.
New in affiliate marketing business listings this week we have a $333K online privacy and hosting business, with significant investment into quality content from the start with the site now offering hundreds of informative, steadily-increasing traffic thanks to the c.75,000 keywords it ranks for, impressive revenue compound monthly growth rate of c.48% over the trailing 12 months, exclusive affiliate partnerships with some of the most dominant players in the VPN space and low owner involvement with a highly scalable cost-structure and content team transitioning post-sale.
New in e-commerce business listings this week we have a $104K Amazon Merch business, with tens of thousands of unique designs in the impressive 22,000 Amazon Merch tier, lean and scalable cost structure driving net margins of over 99% in the trailing 12 months and labor saving automation script, allowing for the creation of thousands of unique designs.
New in SaaS business listings this week we have a $48.9K recruitment automation platform, with feature-rich software and a clear value proposition in a rapidly growing niche, strong SaaS metrics with high LTV of c.$805 over the LTM, automated operations allowing for low owner involvement, proven market demand and customer loyalty as well as lean and scalable cost structure driving steady cash flows. If you are interested in any of the above businesses, please follow the link to request a prospectus.
In events news, Founder Thomas Smale’s conference schedule for the new year will kick off with Accelerate Now Summit on January 4 in San Diego, where he will be speaking about How to Increase the Value of Your SaaS Business. If you are planning on being in the area, reply to this email to set up a meeting!
Continue reading below for more on the EU’s expected regulation, Tencent Music’s IPO and the Amazon seller foul play.
- Significant investment into quality content from the start with the site now offering hundreds of informative, long-form articles
- Steadily-increasing traffic thanks to the c.75,000 keywords the site ranks for
- Impressive revenue compound monthly growth rate of c.48% over the trailing 12 months
- Exclusive affiliate partnerships with some of the most dominant players in the VPN space
- Low owner involvement with a highly scalable cost-structure and content team transitioning post-sale
Yearly net profit: $125,000
Asking price: $333,000
- Tens of thousands of unique designs in the impressive 22,000 Amazon Merch tier
- Lean and scalable cost structure driving net margins of over 99% in the trailing 12 months
- A labor saving automation script, allowing for the creation of thousands of unique designs
Yearly net profit: $37,100
Asking price: $104,000
- Feature-rich software with a clear value proposition in a rapidly growing niche
- Strong SaaS metrics with high LTV of c.$805 over the LTM
- Automated operations allowing for low owner involvement
- Lean and scalable cost structure driving steady cash flows
Yearly net profit: $15,300
Asking price: $48,900
In The News…
EU Likely to Impose New Content Regulations
This week, sources revealed that the European Union is expected to unveil new legislation with the aim of fining online publishers who fail to remove terrorist content from their sites.
While major players like Google, Twitter Inc. and Facebook Inc. have made significant strides to comply with measures set to remove terrorist propaganda from their sites, the European Union is expected to put forth a strict new policy meaning internet platforms big and small will owe fines if they do not remove terrorist content from the site. Those familiar with the matter indicate that proposals could be unveiled beginning in September of next year. Details are not yet clear, though it is likely they would be based on guidance given by the EU in March, which allowed internet companies one hour from the point of notification by authorities to remove offensive material from their platforms, or face legislation.
Clarity around time-frames and the kinds of groups which are considered terrorist organizations will be crucial in avoiding over-removal of content.
Tencent Music Lists on US Markets
Tencent Music had its debut on the NYSE Wednesday, ending the first day of trading up 9.2% at $14.19 per share.
As the music branch of Tencent, Tencent Music owns the four most popular music apps in China. On Tuesday, the tech giant said it raised nearly $1.1 billion after setting share prices at the bottom of the expected range of $13-$15. Granting the company an implied valuation of $21.3 billion, this IPO is now one of the largest Chinese company IPOs on the US markets since Alibaba’s $20 billion IPO in 2014. Tencent Music owns streaming apps QQ Music, Kugou Music and Kuwo Music, and karaoke app WeSing. In the second quarter of 2018, Tencent Music had over 800 million unique monthly active, as stated in its initial prospectus filing.
The filing states that the company has been profitable for the last two years. Tencent, Tencent Music parent company, owns 58% of Spotify. Tencent Music will trade under the ticker TME.
Amazon Sellers Scammed
Amazon.com has experienced a barrage of seller scams on its website, leading to the firing of several employees suspected of feeding independent merchants with proprietary information.
In September, The Wall Street Journal reported that Amazon was investigating suspected data leaks and bribes within the company. A number of workers in the US and India were dismissed on the grounds of inappropriately gaining access to internal data for misuse by disreputable merchants. Recently, however, Amazon has had to remove thousands of suspect reviews, restrict some sellers’ access to customer data and prohibit certain methods of manipulating the order of search results. A spokewoman for Amazon has stated that the company is utilizing machine learning to go after inappropriate behavior and block it before it happens, noting “If bad actors abuse our systems, we take swift action, including terminating their selling accounts, deleting reviews, withholding funds, taking legal action and working with law enforcement.”.
Despite the crackdown, merchants have claimed competitors are maliciously flagging products as counterfeit or infringing trademarks, prompting Amazon to temporarily take down legitimate products while they undergo evaluation.
To view the previous week’s newsletter, click here.
To view the following week’s newsletter, click here.