Alternative Investing Report - December 18, 2024

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*as of 12/17; Sources: S&P, BTC, FTSE, DJRE, CL50

The CEO of SoftBank, Masayoshi Son, announced his intention to invest $100 billion into U.S. companies over the next four years, and to create 100,000 jobs in AI and related infrastructure. In 2016, Son made a similar pledge to invest $50 billion to create 50,000 jobs, and while they met the investment number, it is unclear how many jobs it actually created.

➨ TAKEAWAY: SoftBank is perhaps best known stateside for its failed $18.5 billion investment in WeWork, but its successful investment into semiconductor company Arm has focused its efforts on AI. It is possible that Son was intending to invest $100 billion into AI projects anyway and chose to give himself and the incoming administration some good PR in doing so. In any case, this could lead to even more fundraising and frothier valuations for AI and AI-related companies.

Vincent CEO Eric Cantor was joined by FilmHedge founder Jon Gosier, Slated’s head of film finance Jay Burnley, and Republic’s head of film Marc Iserlis - to talk about why now is a good time to invest into films, and the benefits and risks of the asset class.

After a lackluster year in auction sales, Sotheby’s announced they were laying off 100 employees, after already cutting 50 employees from their London offices in May. Their November art sales generated $533.1 million, a significant drop-off from the $1.2 billion the same sales saw last year. Christie’s announced that they expect their total auction sales from 2024 to fall by 16%, but a rise in private sales meant their overall results were down only 6% overall.

➨ TAKEAWAY: The art market had a slow year, and is still coming down from its pandemic-era highs. It is no surprise that the downturn in total sales is leading to changes at big auction houses. One bright spot is that Christie’s made 63% of its sales in the second half of the year, which could augur well for 2025.

🪙 Ethereum hits 3-year high: Often overshadowed by Bitcoin, the 2nd biggest cryptocurrency topped $4,000 for the first time since 2021, though it still remains below its all-time high of $4,878 as its price growth has lagged behind Bitcoin’s.

🎵 Bob Dylan auction: Just in time for a hyped movie biopic to be released, an auction of 50 pieces of Bob Dylan memorabilia will be held in January at Julien’s, including the original typewritten lyrics to “Mr. Tambourine Man” which carry an estimate of $400,000-$600,000.

🚀 Non-AI startups funding struggles: While AI companies are attracting VC dollars, many other startups are finding fundraising difficult. Only 9% of Series A companies have been able to secure a Series B funding round within two years, compared to 25% who were able to make the leap in previous years.

🏡 Homebuilder confidence steady: The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) was unchanged in the last month, though future sales expectations are at a nearly three-year high.

💵 Private credit ETFs: The recent launch of two private credit ETFs is just the beginning, as major direct lending companies are hoping to allow retail investors easy access to the asset class in 2025.

🚜 Farmland values drop: Iowa’s farmland values declined by an average of 3.1% this year, the first fall in five years, due in large part to the dip in corn and soybeans prices. A survey also shows that land values are expected to fall again next year but rise over the next five.

Movement Labs, a crypto startup that is integrating Facebook’s Move programming language into the Ethereum blockchain, launched its native token MOVE on December 9 at a price of $0.70 per token. It immediately doubled in price, but has since settled back below the initial offering, though it still carries a $1.4 billion market cap and immediately entered the top-100 tokens by market cap.