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The conventional wisdom press and investor is that the core business hit a wall last fall. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. A ltimeter Growth Corp. 2, the second blank check company formed by Altimeter Capital targeting the tech sector, filed on Thursday with the SEC to raise up to $200 million in an initial public. 2499 1749, Monthly We want to hear from you. I don't think the Fed is going to throw away two years' worth of work to try to avoid a recession in a election year and run us straight into the teeth of a recession while we're trying to fight a war in Europe. Get your daily dose of business updates on WhatsApp. Following is the unofficial transcript of a CNBC exclusive interview with Altimeter Capital Founder & CEO Brad Gerstner on CNBC's "Closing Bell: Overtime" (M-F, 4PM-5PM ET) today, Monday, March 14th for the premiere. Do they want to stand with me and ride that out? At Meta, the number of employees is up over 3x from 25k to 85k employees in just the last four years! "Time to Get Fit an Open Letter from Altimeter to Mark Zuckerberg (and the Meta Board of Directors).". That was our baseline that we were going to have a relatively soft landing, three to four rate hikes. Altimeter Capital's Brad Gerstner Issues Open Letter to Meta (NASDAQ: META) and Mark Zuckerberg. Privacy Policy, ISDA uses cookies to enhance your experience on our website. The vast majority of the capex has been an essential and high-returning investment in data centers, Nvidia GPUs and other AI resources to solidify the companys position as one of worlds leaders in AI. United has an Underqualified, Ineffective, and Entrenched Board: While presiding over United's stunning long-term underperformance, we believe that the incumbent Board (and a majority of the newly-expanded 15-person Board): (1) lacks sufficient leadership, expertise, and experience to challenge management and hold management accountable, to direct an operational and financial turn-around, and to maximize stockholder value; (2) has entrenched itself by implementing various mechanisms to financially penalize stockholders for making meaningful Board changes; (3) has failed to adequately align management compensation with stockholder interests; and (4) is too stale to effectively represent stockholders. But what is the right amount? Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. Meta. And what is going to be the resolution to the situation in the Ukraine? And I've let the company know that, right? An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards. Consumer confidence is plummeting. GERSTNER: So, Scott that you know the top six names in our book are all companies that we believe are, you know, both accelerating, expanding margins, expanding free cash flow margins, right, and that are critically important and will be worth more in the future. So the way companies have to get there is by growing their top line and growing their bottom line, the answer as to all companies many most certainly will not. I mean, two years ago we were we were having this conversation. Meta Platforms, which is set to report third-quarter results on Wednesday after markets close, declined to comment. Altimeter Capital Management is a hedge fund with 17 clients and discretionary assets under management (AUM) of $17,950,309,162 (Form ADV from 2022-05-27). Published Jan 7, 2021 6:11AM EST A ltimeter Growth Corp. 2, the second blank check company formed by Altimeter Capital targeting the tech sector, raised $400 million by offering 40 million. Adani Group on Thursday said US-based boutique investment firm GQG Partners has picked up equity stakes worth $1.87 billion (15,446 crore) in four listed group companies Adani Ports and Special Economic Zone, Adani Green Energy, Adani Transmission and flagship Adani Enterprises via secondary share sales. With that said, we have a shortage of talent in Silicon Valley. At the same time that Meta ramped up spend, you lost the confidence of investors. BRAD GERSTNER: Hey, Scott, thanks for having me. I mean, we're talking about billions of dollars in revenue but you left that out. Altimeter Capital Management LP lifted its position in shares of SEA by 128.0% during the first quarter. He said a 20% cut in employee spending would take Meta back to the levels of staffing it had last year and argued that the company can't spend as it used to since the cost of capital and interest rates have risen recently. Brenda Yester Baty, Head of Strategic Initiatives at Lennar Corp.; former SVP Revenue Management at Carnival Cruise Lines. As such, we think during this period of growth transition and economic uncertainty, the company should decrease capex by at least $5B and maintain this discipline until revenues re-accelerate bringing our capex as a percentage of revenue more in line with our large cap peers. Board of Directors Accept. Meta can get its mojo back, says Brad Gerstner, but it will have to take some hard decisions first. In the back half, you don't have those same comp issues that you have caused by COVID. Ray Dalio's: Bridgewater Associates. Southeast Asian superapp Grab is likely to set a world record by selling itself into a special purpose acquisition company, or SPAC, run by U.S. tech venture capital investors Altimeter Capital . We believe the future lies in AI. We didn't think that was durable. United Continental Holdings, Inc. You know how to time markets. And we've had government intervention of the magnitude. 2,06,700 crore) a year and capped annual investment in the metaverse to $5 billion (roughly Rs . And frankly, I don't think we're gonna have hyperinflation in a world where demand is being destroyed at the rate it's currently being destroyed. Altimeter Capital Management LP Info Size ($ in 1000's) At 12/31/2022: $3,652,571 At 09/30/2022: $4,676,285 Altimeter Capital Management LP holdings changes, total fund size, and other information presented on HoldingsChannel.com was derived from Altimeter Capital Management LP 13F filings. March 8, 2016 The industry leader for online information for tax, accounting and finance professionals. Can it possibly be worth 100 billion? 2023 Benzinga.com. In addition, people are confused by what the metaverse even means. We are generally patient investors. But far from being a bad decision, we think the recommendations outlined above will lead to a leaner, more productive, and more focused company a company that regains its confidence and momentum. About Altimeter Capital Altimeter is a leading technology focused investment firm based in Silicon Valley with over $15 billion in assets from endowments, foundations, and family offices. What is the metaverse and why are billions of dollars being spent on it? Altimeter Capital Management, LLC a Portfolio Activity as reported in the most recent 13F form published on Dec 31, 2022. The definitions and provisions contained in the Protocol Agreement are incorporated into this Adherence Letter, which will supplement and form part of each Protocol Covered Agreement between us and each other Adhering Party. Altimeter manages a long / short public equity fund and private growth equity funds. Your P/E ratio has fallen from 23x to 12x and now trades at less than half the average P/E of your peers. So, its with some hesitation, but significant conviction, I am sharing an open letter strongly encouraging Meta to streamline and focus its path forward. Brad Gerstner "An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards," Gerstner wrote. As such, we would encourage the company to move aggressively and cut at least 20% of employee-related expenses by January 1, 2023. According to Hedge Follow, it was authored by Brad Gerstner, CEO and founder of technology investment firm Altimeter Capital. Altimeter Capital Management, LP Buys Opendoor Technologies Inc, Toast Inc, Duolingo Inc, Sells . August 2012 Protocol ALID: 66703 . They're building their own ad platform, right, that can deal with this. With the gains posted on March 3, Meta Platforms shares are up 54% this year. In fact, we distributed over $6 billion worth of Snowflake to our venture investors last year. Now you didn't address any of the iOS changes and the revenue hit that Facebook is is assuming from that and those are legitimate changes. As a result, the team hastily pivoted the company toward the metaverse including a surprise re-naming of the company to Meta. As you know, we have attempted to work collaboratively with the current Board to meaningfully improve governance, Board composition, and oversight. Digital Markets Act (DMA): How the EU Law Will Work, Mark Zuckerberg: Founder and CEO of Meta (formerly Facebook), Crowdfunding: What It Is, How It Works, Popular Websites, FTX: An Overview of the Exchange and Its Collapse, New Prices for Meta Quest 2s 256GB SKU + Meta Quest Pro, Time to Get Fit an Open Letter from Altimeter to Mark Zuckerberg (and the Meta Board of Directors), Meta Reports Fourth Quarter and Full Year 2022 Results. Hedge Fund Manager. The company has lost investor confidence as it ramped up spending and pivoted to the metaverse, the technology-focused hedge fund with a 0.1% stake said, and suggested a three-step plan. Why 20%? We'll see you soon. 16,839 Followers. 233 South Wacker Drive And, while that ultimately is an important long-term measure of success for all of Metas stakeholders, it would be imprudent to make short-term bad decisions just to improve the share price. Read More . Meta didn't immediately respond to a request for comment. Days Trial. Our six nominees have the necessary skills, leadership abilities, and relevant experience to catalyze a United course change and to help the Company realize its immense potential. GERSTNER: Without a doubt the single biggest lever on growth multiples is rates. We certainly are neither short-term traders nor activists. Background [ edit] In 2008, Brad Gerstner founded Altimeter Capital in Boston, Massachusetts. March 2013 Protocol ALID: 66704. We dont have any demands. A securities lawyer, Brad Gerstner graduated from HBS in 2000 and joined General Catalyst. Meta has also been feeling pressure to improve the finances of its Reality Labs, the company's metaverseunit, which includes the VR headsets. Altimeter Capital Management is an investment firm with offices in Menlo Park, CA, and Boston, MA. WAPNER: We're back now with Altimeter Capital's Brad Gerstner hanging out with us at "Overtime" today, You know, we talked about the magnitude Brad by which some of these stocks have come down and I'm looking at the, listen, it's not just Meta, obviously. Ram Parameswaran is the founder of Octahedron Capital, a global, growth-oriented investment firm that seeks to make concentrated investments in leading public and private companies that drive the world's internet economy. Think about this, Scott. NEW YORK, Nov. 16, 2021 (GLOBE NEWSWIRE) -- H1, which provides the largest global healthcare network that connects healthcare professionals, announced today that it has raised a $100M Series C. There isnt a day that goes by where I dont find myself using Metas products to communicate, to connect, and to entertain still amazed at the power of these services. I have deep respect and admiration for founders that continue to grind, inspire, and invent long after the financial motivation is gone. $6.9 M. It's 3 trillion, right? Samooha, a startup developing a "cross-cloud" data collaboration platform, today announced that it raised $12.5 million in a funding tranche backed by Altimeter Capital and Snowflake Ventures . Altimeter Feb 2021 - Present2 years 2 months New York, United States Chris is a Partner at Altimeter on the private investing team where he focuses on investing in iconic late stage technology. Altimeter Capital Management LP. Their last reported 13F filing for Q4 2022 included $3,652,571,000 in managed 13F securities and a top 10 holdings concentration of 99.95%. Right? And we are confident that your long-term investments in AI and the next generation of communications will continue to drive us all forward. We understand that the Protocol is designed to amend only those Protocol Covered Agreements between two Adhering Parties that were previously amended pursuant to the terms of the August 2012 Protocol, the March 2013 Protocol or both. Kultura Capital Management is being structured as a hybrid fund that will focus on late-stage tech startups as well as public companies, the person said. If the deal goes through, it. But it's good to be here and and you know, while I think we we did see the normalization and multiples as a likely outcome toward the end of last year. It's going to do 20 billion in GMV. The Meta investor recommended a plan to get the company's "mojo back," including reducing headcount expenses by 20% and limiting the company's pricey investments in "metaverse" technology VR software and hardware to no more than $5 billion per year. GERSTNER: Right, it comes down fundamentally to a question Scott of whether you think we're gonna have more than eight rate increases or less. As you know, we are long-term shareholders. Investors in the round: 776 Capital, Altimeter Capital, BoxGroup, Dragoneer Investment Group, FirstMark, General Catalyst, Radcliff Group, ShawSpring Partners, SignalFire, The Baupost Group, Torch Capital, TQ Ventures Now that's what's going on in the business so all those people writing rest in peace epitaphs for Facebook are going to have to deal with that acceleration. As you know we entered the year with a big bond short, we've now covered that bond short because we don't think that it's possible for the Fed to raise rates 7,10, 12 times as some people think this year. The lagging stock price under this Board's control and supervision directly reflects substantial underperformance in terms of operational reliability, customer satisfaction, market share, profitability, and return on invested capital. Popular Searches. So if you want to bet on the future of growth, Southeast Asia is one of the places you want to bet this is one of the dominant brands, dominant internet platforms, and it's got 7 billion of cash on the balance sheet. Amazon Is Closing Its Cashierless Stores in NYC, San Francisco and Seattle, Amazon Pauses Construction on Second Headquarters in Virginia as It Cuts Jobs, Stock Traders Are Ignoring Blaring Bond Alarms, iPhone Maker Plans $700 Million India Plant in Shift From China, Russia Is Getting Around Sanctions to Secure Supply of Key Chips for War. Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks. It has 24 billion in free cash they're going to generate this year. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. It is a poorly kept secret in Silicon Valley that companies ranging from Google to Meta to Twitter to Uber could achieve similar levels of revenue with far fewer people. United Urgently Needs a Course Correction: United's stockholders, customers, and employees deserve better Board governance, better Board leadership, and better Board performance. The deal values the combined company at $35 billion and will. At Meta, the number of employees is up over 3x from 25k to 85k employees in just the last four years! When you visit the site, Dotdash Meredith and its partners may store or retrieve information on your browser, mostly in the form of cookies. Rates are going up and we have a war. I have been told that Amazon spent far less in total to build AWS. He left GC and became co-CEO of NLG, an early online travel start-up purchased in part by IAC.He co-founded Openlist.com, a local search start up that was self-funded and sold to Marchex (Nasdaq: MCHX);He was a partner at PAR Capital, a multi-billion hedge. "Meta Reports Fourth Quarter and Full Year 2022 Results," Page 10. The firm also considers investments in the consumer products and services, gaming, retail, and transportation sectors. Investopedia requires writers to use primary sources to support their work. The facts are startling. Brad Gerstner is the Founder & Chief Executive Officer at Altimeter Capital based in Boston, Massachusetts. WAPNER: So let me talk about your overall exposure if I if I could because by last December, you had said you had taken most of your your shorts off and your long exposure was back up to 70%. "Meta needs to re-build confidence with investors, employees and the tech community in order to attract, inspire, and retain the best people in the world," Gerstner wrote in the letter. Tina Sharkey, CEO of SherpaFoundry; former board member of HomeAway; and Right if the Fed raises rates 10 or 12 times given the demand destruction and the slowdown already underway in this country, we will be in a big recession come fall. b***@altimeter.com. Login The purpose of this letter is to confirm our adherence as a Protocol Participant to the ISDA 2021 SBS Top-Up Protocol Agreement as published by the International Swaps and Derivatives Association, Inc. on February 25, 2021 (the Protocol Agreement). The full text of the stockholder letter to the United Board follows: March 8, 2016. He said the money the company is currently spending to develop VR could add up for a decade before it comes to fruition.
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