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$FUBO - the most hated/loved company on #Fintwit
I have a position & given the very relevant bear arguments, I have reaffirmed why I invested in the company.
I believe that this company is a "Story" Stock & to invest, you need to believe in the story
THREAD
I have a position & given the very relevant bear arguments, I have reaffirmed why I invested in the company.
I believe that this company is a "Story" Stock & to invest, you need to believe in the story
THREAD
Story Stock - what is it?
- Visionary CEO
- Youthful Company (Major execution risk)
- Poor Current Business Model
- #Fintwit Arguments
- Great Brand
- Great but unproven future prospects
- High Short Interest
- A List Investor Base
- Visionary CEO
- Youthful Company (Major execution risk)
- Poor Current Business Model
- #Fintwit Arguments
- Great Brand
- Great but unproven future prospects
- High Short Interest
- A List Investor Base
Bear Case - Terrible Current Unit Economics (Business Model)
- $FUBO may NEVER make profit from subscription income
- Costs increase as subscription income increases
- Saturated Market (YouTube TV, HULU, Sling)
I totally agree, then why invest?
- $FUBO may NEVER make profit from subscription income
- Costs increase as subscription income increases
- Saturated Market (YouTube TV, HULU, Sling)
I totally agree, then why invest?
$FUBO Story:
- Sports First Platform (Live TV Streaming)
- Wagering/Gambling
- CTV Ads
- Gaming
- Exclusive sporting events
- A List Investors
- High growth
- Tech first company
- Management Team
- Sports First Platform (Live TV Streaming)
- Wagering/Gambling
- CTV Ads
- Gaming
- Exclusive sporting events
- A List Investors
- High growth
- Tech first company
- Management Team
Company Size - $Fubo is a small & young company, for comparison:
$Fubo - $1.6bn (mrkt cap) - 2015 (founded)
$NFLX - $220bn - 1997
$SPOT - $65bn - 2006
$ROKU - $51bn - 2001
If you dont want execution risk, $Fubo's not for you. However, possible 10X or more (possible $0 too).
$Fubo - $1.6bn (mrkt cap) - 2015 (founded)
$NFLX - $220bn - 1997
$SPOT - $65bn - 2006
$ROKU - $51bn - 2001
If you dont want execution risk, $Fubo's not for you. However, possible 10X or more (possible $0 too).
Subscription Numbers:
- $FUBO subscribers are the funnel to the eco system (similar to $ROKU selling hardware devices).
- 545k subscribers as of Dec 2020 (previous forecast 500 - 510k) - 72% YoY
- $FUBO is under promising and over delivering (essential in a story stock)
- $FUBO subscribers are the funnel to the eco system (similar to $ROKU selling hardware devices).
- 545k subscribers as of Dec 2020 (previous forecast 500 - 510k) - 72% YoY
- $FUBO is under promising and over delivering (essential in a story stock)
Secular Trends:
- Cord Cutting
- Sports Lovers
- CTV Advertising
- Gambling/Wagering
$FUBO is at the intersection of all 4.
- Cord Cutting
- Sports Lovers
- CTV Advertising
- Gambling/Wagering
$FUBO is at the intersection of all 4.
Cord Cutting:
- Even the biggest of Bears can accept CC is a positive for $FUBO
- Most CC still pay for cable due to live Sports
- CC should accelerate subscribers to $FUBO and online competitors (YouTube, Sling, Hulu)
- CEO: "90% of customers are Cord Cutters"
- Even the biggest of Bears can accept CC is a positive for $FUBO
- Most CC still pay for cable due to live Sports
- CC should accelerate subscribers to $FUBO and online competitors (YouTube, Sling, Hulu)
- CEO: "90% of customers are Cord Cutters"
Sports Lovers / Brand:
- $Fubo has positioned itself as the online Sports service
- As a sports fanatic, I know how much I pay for live sports, gambling & related activities
- $NFLX, $AMZN prime just doesn't cut it
- $Fubo customers stream 121 hours per month ($NFLX only 50)
- $Fubo has positioned itself as the online Sports service
- As a sports fanatic, I know how much I pay for live sports, gambling & related activities
- $NFLX, $AMZN prime just doesn't cut it
- $Fubo customers stream 121 hours per month ($NFLX only 50)
CTV Ads:
- $FUBO allocated 20% of ad inventory per hour (same deal as local cable)
- However, use programmatic ads (big advantage)
- $FUBO currently takes in $7 ad ARPU per month - target of $20 net after expenses ARPU (ticket to profitability)
- Q3 2020, $7.5m (153% YoY)
- $FUBO allocated 20% of ad inventory per hour (same deal as local cable)
- However, use programmatic ads (big advantage)
- $FUBO currently takes in $7 ad ARPU per month - target of $20 net after expenses ARPU (ticket to profitability)
- Q3 2020, $7.5m (153% YoY)
CTV Potential Rev:
- If 1m subs, $10/monthly ARPU - $120m (annual Rev)
- If 1m, $20 ARPU - $240m
- If 5m, $10 ARPU - $600m
- If 5m, $20 ARPU - $1.2bn
- If 10m, $10 ARPU - $1.2bn
- If 10m, $20 ARPU - $2.4bn
This platform can become profitable through CTV ads (w/out wagering)
- If 1m subs, $10/monthly ARPU - $120m (annual Rev)
- If 1m, $20 ARPU - $240m
- If 5m, $10 ARPU - $600m
- If 5m, $20 ARPU - $1.2bn
- If 10m, $10 ARPU - $1.2bn
- If 10m, $20 ARPU - $2.4bn
This platform can become profitable through CTV ads (w/out wagering)
Programmatic Ads - future:
- CEO: "If you like to bet on field goals, can we show you 11 games that are about to go into field goals"
- Can watch 4 games concurrently on 1 screen
- Could we order $DPZ through one click CTV ads?
- Stream on 5 devices, 5 different targeted ads?
- CEO: "If you like to bet on field goals, can we show you 11 games that are about to go into field goals"
- Can watch 4 games concurrently on 1 screen
- Could we order $DPZ through one click CTV ads?
- Stream on 5 devices, 5 different targeted ads?
Wagering:
- Complex but CEO keen to get involved
"online sports wagering is expected to be a $155bn market by 2024" Zion Market Research
- Even if $Fubo, doesn't have their own gambling site, Ad $$ will be huge on $Fubo.
- Balto Sports Acq - aim to drive gaming on $Fubo
- Complex but CEO keen to get involved
"online sports wagering is expected to be a $155bn market by 2024" Zion Market Research
- Even if $Fubo, doesn't have their own gambling site, Ad $$ will be huge on $Fubo.
- Balto Sports Acq - aim to drive gaming on $Fubo
Exclusive Sports Rights:
- Launched its own ad supported TV network in June 2019 (Fubo Network TV)
- Cannot compete for NFL, NBA rights (could start with Niche sports)
- CEO has stated intention in recent interview
- Launched its own ad supported TV network in June 2019 (Fubo Network TV)
- Cannot compete for NFL, NBA rights (could start with Niche sports)
- CEO has stated intention in recent interview
Management / Investors:
- I love to invest alongside the best investors
- As you can gather, the Live TV Streaming space is incredibly complex
- Therefore, I am placing my faith in this A List of investors/mgmt to make the story come to fruition
- I love to invest alongside the best investors
- As you can gather, the Live TV Streaming space is incredibly complex
- Therefore, I am placing my faith in this A List of investors/mgmt to make the story come to fruition
CEO/Co-Founder - David Gandler:
- He's a story teller
- Passionate about sports
- Owns 4%
- Great (short) recent interview
- He's a story teller
- Passionate about sports
- Owns 4%
- Great (short) recent interview
Mike Berkley – Chief Product Officer
- Former Comcast, Viacom and Spotify exec who joined Fubo in Nov 2020
Quote from Mike:
"The potential for casual gaming and wagering as part of the live sports viewing experience is especially compelling. I love the company’s ambition.”
- Former Comcast, Viacom and Spotify exec who joined Fubo in Nov 2020
Quote from Mike:
"The potential for casual gaming and wagering as part of the live sports viewing experience is especially compelling. I love the company’s ambition.”
Daniel Leff - BOD:
- Owns 6% of the voting shares (worth around $120m)
- Purchased an additional 200k shares @ $10 on public listing in 13 Oct 2020
- Early $Roku investor and current board member (Massive!)
- The Athletic investor & BOD
This guy knows what he is doing!
- Owns 6% of the voting shares (worth around $120m)
- Purchased an additional 200k shares @ $10 on public listing in 13 Oct 2020
- Early $Roku investor and current board member (Massive!)
- The Athletic investor & BOD
This guy knows what he is doing!
Edgar Bronfman Jr (Executive Chairman)
- Former chairman and CEO of Warner Music
- Owns close to 6% of the voting share (worth around $120m)
- Purchased an additional 200k shares @ $10 on public listing in 13 October 2020
- Knows the complex dynamics of the industry
- Former chairman and CEO of Warner Music
- Owns close to 6% of the voting share (worth around $120m)
- Purchased an additional 200k shares @ $10 on public listing in 13 October 2020
- Knows the complex dynamics of the industry
John Textor (Head of Studio)
- Co-founder and previous CEO of Facebank Group (merged with $Fubo).
- Owns 12% of $Fubo
- Former Pro Skateboarder
- Owner of Sims Snowboards, the world’s 2nd leading snowboard brand, through which he created the World Snowboarding Championship
- Co-founder and previous CEO of Facebank Group (merged with $Fubo).
- Owns 12% of $Fubo
- Former Pro Skateboarder
- Owner of Sims Snowboards, the world’s 2nd leading snowboard brand, through which he created the World Snowboarding Championship
TV network investors:
- $DIS - 2.85% of the voting rights - investment made in conjunction with an agreement to launch Disney channels on the platform (ESPN)
- $VIAC - 2.62% of the voting rights
- $CMCSA (Sky) –3.2% of the voting rights (prior to recent sell off.....cont'd
- $DIS - 2.85% of the voting rights - investment made in conjunction with an agreement to launch Disney channels on the platform (ESPN)
- $VIAC - 2.62% of the voting rights
- $CMCSA (Sky) –3.2% of the voting rights (prior to recent sell off.....cont'd
$CMCSA:
Sky was an early investor in $Fubo (major plus as run sports & gambling empire in the UK)
$CMCSA purchased Sky in Oct 2018
$CMCSA sold 500k shares on 31 Dec 2020
For perspective, $CMCSA sold 5.2m shares of $PTON in Apr 2020 for $34.21 or $177m (currently worth $792m)
Sky was an early investor in $Fubo (major plus as run sports & gambling empire in the UK)
$CMCSA purchased Sky in Oct 2018
$CMCSA sold 500k shares on 31 Dec 2020
For perspective, $CMCSA sold 5.2m shares of $PTON in Apr 2020 for $34.21 or $177m (currently worth $792m)
Summary Investment Thesis:
Creation of sticky sports platform including live Sports, Wagering, Games, Fantasy
- Subscriptions may NEVER be profitable (will act as a funnel)
- $FUBO acquire direct sports rights
- CTV ads & wagering will be the profit makers
- Int'l expansion
Creation of sticky sports platform including live Sports, Wagering, Games, Fantasy
- Subscriptions may NEVER be profitable (will act as a funnel)
- $FUBO acquire direct sports rights
- CTV ads & wagering will be the profit makers
- Int'l expansion
I fully understand that as a "Story" Stock, there is a large amount of execution risk.
It is quite likely that the company could go out of business
I am happy with these risks given the huge potential.
Long $FUBO
Thanks @rorycarron for questioning!
@Beth_Kindig @Market
It is quite likely that the company could go out of business
I am happy with these risks given the huge potential.
Long $FUBO
Thanks @rorycarron for questioning!
@Beth_Kindig @Market
