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The DL - Day Two at Amazon, Docusign > United, The DL Turns One, Robot Dog

June 22 · Issue #53 · View online
The DL
Welcome to The DL, a weekly newsletter about tech, startups, and investing in the Pacific Northwest.
This week’s issue covers Day Two at Amazon, Docusign’s NASDAQ 100 milestone, The DL’s birthday celebration, and a link to buy a Boston Dynamics robot dog.
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And on the second day...
Earlier this year, The Economist wrote an article on how Seattle is the new epicenter of the tech world as products and business models move away from ads towards subscriptions, e-commerce, and cloud infrastructure.
Last week, they followed up with a deeper dive on Amazon’s incredible “Day One” run…
Amazon’s market cap doubled to $734B between 2016 and 2018. Since then it has close to doubled again. Its shares trade at 118x earnings, compared with 25-35x for Apple and Microsoft, the other members of the trillion-dollar-company club.
and the factors driving Amazon towards “Day Two.” The key risks they call out are:
  • Conflicts of interest - Amazon competes with their third-party sellers. Retailers don’t trust their data with AWS.
  • Bloating - Amazon has gone from asset-light to asset-heavy. Politicians want to break Amazon up.
  • Competition - Amazon is seeing more competition in both retail and cloud. Competitors are beating Amazon internationally.
All valid points. But as big tech gets bigger and bigger, it seems like this list will be pretty similar for all of the big tech cos. (Just look at Apple’s App Store controversy last week.)
Anyway, it seems like investors aren’t too worried. If you ask Fortune 500 CEOs the question, “If you were going to invest in the stock of one company other than my own on the Fortune 500 today, who would it be?” The number one answer is still Amazon, followed by Microsoft and Apple!
👊 Go Docusign!
After its IPO in 2018, Docusign traded around $40-50 per share, and today it’s trading at over $160, giving it a market cap of ~$30B. Thanks to this growth, Docusign is officially becoming part of the NASDAQ 100 (100 largest companies on the NASDAQ), replacing United Airlines.
There were a bunch of other articles the last few weeks about tech companies overtaking “non-tech” companies, so here are some of the interesting ones:
  • 🚗 Tesla is now the world’s most valuable automaker (they sold 192K cars in 2019, while Toyota sold 10.7M)
  • Nikola is worth more than Ford (they sold 0 cars, ever, while Ford sold 5.5M last year)
  • 🎥 Zoom is worth as much as Goldman Sachs; and more than GE, Caterpillar, and Walgreens
  • 🛍️ Shopify surpassed RBC to become the most valuable company in Canada
  • 🍿 Netflix is worth more than Disney and Comcast
Tech is taking over, but there are definitely industries where “legacy” competitors invested in tech early on and are “winning.” Check out Domino’s vs. the food delivery companies or Visa over the last 10 years.
The DL is turning one this week! Woohoo! To celebrate, I’m giving away two $52 Amazon gift certificates (enough to buy two of these inflatable unicorn water sprinklers!).
All you have to do to enter is forward this newsletter to someone who…
  • You would invest in no matter what (even if the idea was truly terrible)
  • - OR -
  • You would never invest in no matter what 😏
and cc/bcc! You get one entry for every share!
Other stuff Dan's talking about
🐶 OMG I WANT ONE - Once the DL makes $75K, we are going to buy a Boston Dynamics robot dog (also, we have a strict no kicking rule)
🧒 Only 90s kids will understand - Neopets is launching a mobile site! While kids today have Robinhood, Neopets’ stock market was my first exposure to “investing.” (The secret was stocks in Neopets could not go lower than $6. Too bad this doesn’t work in the real world lol)
💭 Chamath’s favorite interview question - Last week, the most-clicked link in The DL was this profile of Chamath Palihapitiya. This week, he shared his favorite question to ask candidates in job interviews
🥅 #Goals - Good reference doc on “good retention” for businesses focused on consumers, SMBs, and enterprises. Has benchmarks for both customer/logo retention and net revenue retention
Please hit reply! (Or subscribe or forward!)
About me: I work as an investor at Madrona Venture Group, a Seattle-based venture capital firm that has been early partners with companies like Amazon, Smartsheet, Apptio, and Redfin.
If you have thoughts, questions, or comments, hit reply! If you’re new, check out some of the DL’s top articles from the last few months:
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