10k Words | July 2022

 Apparently, Confucius did not say “One Picture is Worth Ten Thousand Words” after all. It was an advertisement in a 1920s trade journal for the use of images in advertisements on the sides of streetcars. Even without the credibility of Confucius behind it, we think this saying has merit. Each month we share a few charts or images we consider noteworthy.

Revenue multiples have returned to pre-2020 levels for high growth software companies, based on Octahedron's index. The dowturn in valuations was accompanied by a 23% year-on-year decline in March quarter VC funding for late-stage and technoology growth funding, crunchbase calculated - although it found seed and angel investment held up better, growing 9% year-on-year. The Information found VC firms buying listed tech stocks, meanwhile consensus data from FactSet shows the tech sector is not expected to have been among the strongest growth areas of the S&P 500 in the June quarter - energy and materials stocks have the most expected of them. Kailash Capital shows that price growth for the S&P 500 in the 2017-2021 period has doubled the long-term average return. Finally, Bloomberg charts the rise of self-employment in the US.

Octahedron Growth Software Index (EV / NTM Rev)

Source: Octahedron

Global Venture Dollar Volume by quarter
Source: Crunchbase

Global Seed and Angel Investment by quarter
Source: Crunchbase

VC Firms Buying Publicly Listed Shares
Source: The Information

S&P 500 Revenue Growth Expectations
Source: FactSet

S&P 500 historical average returns

Source: Kailash Capital

Americans increasingly shifting to self-employment
Source: Bloomberg

Popular posts from this blog

Feel the Cash Burn as Profit Season Closes (or "In memory of Pocketmail")

New commentary up on livewire: An overlooked small cap agri stock

We reckon equity is a key incentive


Nothing in this blog constitutes investment advice - or advice in any other field. Neither the information, commentary or any opinion contained in this blog constitutes a solicitation or offer by Equitable Investors Pty Ltd (Equitable Investors) or its affiliates to buy or sell any securities or other financial instruments. Nor shall any such security be offered or sold to any person in any jurisdiction in which such offer, solicitation, purchase, or sale would be unlawful under the securities laws of such jurisdiction.

The content of this blog should not be relied upon in making investment decisions.Any decisions based on information contained on this blog are the sole responsibility of the visitor. In exchange for using this blog, the visitor agree to indemnify Equitable Investors and hold Equitable Investors, its officers, directors, employees, affiliates, agents, licensors and suppliers harmless against any and all claims, losses, liability, costs and expenses (including but not limited to legal fees) arising from your use of this blog, from your violation of these Terms or from any decisions that the visitor makes based on such information.

This blog is for information purposes only and is not intended to be relied upon as a forecast, research or investment advice. The information on this blog does not constitute a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Although this material is based upon information that Equitable Investors considers reliable and endeavours to keep current, Equitable Investors does not assure that this material is accurate, current or complete, and it should not be relied upon as such. Any opinions expressed on this blog may change as subsequent conditions vary.

Equitable Investors does not warrant, either expressly or implied, the accuracy or completeness of the information, text, graphics, links or other items contained on this blog and does not warrant that the functions contained in this blog will be uninterrupted or error-free, that defects will be corrected, or that the blog will be free of viruses or other harmful components.Equitable Investors expressly disclaims all liability for errors and omissions in the materials on this blog and for the use or interpretation by others of information contained on the blog.