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How To Value A Stock (From Someone Who Has Beaten The S&P Almost Every Year Since 2008)

I recently wrote this up for my friends who asked me how I do what I do. I figured I'd share it here. This is freely available to anyone who wants it, though please credit me if you simply copy/paste. Nothing here is novel, and can be done by anyone. I am not a financial professional, and the example given below is only Abbvie because I forgot that Abbott Labs was alphabetically the first in the S&P 500 when picking an example.
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First, let’s come right out and say that if you do not have the time to do this, or do not find it enjoyable, just buy low-cost index funds that track either the total market or the S&P 500.
Second, let’s make an important distinction:
Investing – This is the act of purchasing assets for less than their intrinsic value. This PDF will focus on how to determine the intrinsic value of an asset that produces income. Note that for most assets, this is simply how much money you can extract from the asset over the period of time that you hold it for. There’s no other value than money in investing. Causes and emotions are what philanthropy is for.
Speculating – This is, at its core, the act of taking supply of an asset from the present to the future (by hoarding it). If there is more demand, lower supply, or both, this pays the speculator to take the asset from a period of low value to one of high value. It is not gambling, but is very difficult to do, since it entails taking on timing risk. It is not illegal, immoral, or impossible, but I have no special insight into it. I’ll leave it there.
Gambling – This looks a lot like speculation, but without any particular reason to believe the asset will be more valuable in the future. Speculators at least estimate the value of an asset to investors, as they are ultimately the end market for an asset. Do not gamble. Full stop.
Determining the intrinsic value of an asset
The value of an asset is simply the present value of all future income that asset can provide you. Since a dollar in five years is naturally less valuable than a dollar today, you have to discount future income against the opportunity cost of forgoing the dollars you invest today. When we get to the Present Value equation, this is represented by interest. It can also be thought of as the opportunity cost of investing in the asset instead of some other asset or simply consuming the dollars instead.
Here’s the actual math. Note that it’s not super hard, and while I will explain it, there are dozens of free websites that will quickly let you calculate this. The key phrase to Google would be “present value of a growing annuity calculator.”
PV = (C / i - G) * {1 – [(1 + G)/(1 + i)]^n}
PV = present value
C = cash flow per period
n = number of payments
i = interest rate
G = growth rate
The value for PV is your estimation of what the asset is worth today. If this ends up far higher than the market price, you are probably purchasing dollars for quarters. Avoid edge cases, as you are guessing about both the interest and growth rate.
C is the cash flow per period. If you have a high degree of confidence in the culture of the company and it has a long history of being good stewards of retained earnings, you can use the earnings per share (EPS). I usually use the dividend. It is impossible to fake or financially engineer a dividend, and requires less looking through financial documents to make sure it’s what it appears to be. But for, say, Apple or Microsoft or Chevron, feel free to use the EPS.
The number of payments is how many payments you expect while holding the asset. Dividends in American companies are typically quarterly (though some pay monthly or every six months, so check on that), so every multiple of four would represent one year if you choose to do it that way. If n = 16, then you’re expecting to hold the asset for 4 years. You can also put in a year’s worth of dividends and keep n = years rather than quarters.
I typically do n = 30, since 30 years is both a long time horizon that is realistic, and coincides when I will hit “retirement age.” You will have to decide how far ahead you’re planning. For most people, they are net purchasers of investments while working and net sellers while retired, so keep that in mind. Note that using years instead of quarters will lessen the amount of compounding, and will provide some cushion in case you’re wrong.
Interest is one of the two variables you have to guess at. Typically, one would put what you expect the actual long-run interest rate to average for this investment. Unfortunately, this is really difficult. Instead, I use a rate that represents my opportunity cost. There are any number of relatively safe ways to get a 5% yield on money invested, so I generally use i = 5% to represent that this asset has to perform better than a utility or telecom or real estate investment trust. Feel free to use what you feel is most appropriate for you. A higher interest rate will lower the value of the asset, so high-balling this number will provide some cushion in case you’re wrong.
The second variable you have to guess at is the growth rate. If you’re looking at the dividend, you want to know how fast to expect it to grow over time. If you’re using the EPS for C, then you want to see how quickly the total earnings are growing per share. This is extremely difficult to predict. I recommend taking the 5-year growth rate and halving it. Dividends will also be more predictable here, as most companies pay out far less than they make, which means even if EPS grows slowly, the dividend can still grow quickly for many years after a boom is over for the company. Note that lowering your estimate for G will lower the value of the asset, so low-balling this number will provide some cushion in case you’re wrong.
OK, so let’s walk through an example. I’ll use Abbvie, a biotech/pharmaceutical company. It has a quarterly dividend for the coming year of $1.30/share. Its dividend has an 18.5% growth rate over the last 5 years, and has grown it for the last 7 (it’s only been around for 8 years).
I assumed a growth rate (G) of 7%. I used $5.20 as the starting dividend this coming year and used years for my n = 30. As always, I used i = 5%.
This gave me an estimated present value of 1 share of Abbvie at $197.94. As of writing this, Abbvie shares are trading on the market at $103.43. This looks like a screaming buy, but first let’s look at why I have a high degree of confidence.
Note how the interest was higher than the going rate – I used my “low-risk alternative” as an opportunity cost. Abbvie has an extremely high rate of growth for its dividend, so I took less than half of its current rate. I also calculated annually rather than quarterly, which reduces the impact of high rates of growth. That’s three places in the equation where I consciously lowered the estimated value of a share of Abbvie, and it still came out as a strong buy – spending less about 50c for a dollar!
I do this because even if I’m wrong in some or all of my predictions, I now have quite a bit of room to be wrong and still make money. It’s like how you don’t walk next to a steep cliff, right? You should know how to walk where you want to, but there’s always the small chance something could cause you to slip or put a foot wrong. But if your plan is always to be 5 feet away from the edge of the cliff, the odds are that you’ll not go over the edge even if you fall down.
Many people feel this is over cautious. But let my portfolio speak for itself. I’ve beaten the S&P 500 index fund every year except one since 2008. My brokerage only keeps digital records back to Dec 2015, but the S&P 500 returned 101% since then – with dividends reinvested. My own portfolio has returned 256%.
So caution is still very high reward. In fact, if you just don’t lose, you’ll do better than the vast majority of professional money managers (about 85% of whom cannot even match the index funds).
Due diligence still has to occur
Now, we can’t just go straight out and buy Abbvie – though it’s a high profile company that receives lots of investor and regulator scrutiny so it’s less likely to have a landmine than most. Just to make sure, you’ll want to do the following before buying shares in this company:
-Check the debt load. If the debt is very high, has very high interest rates, or has a lot of it maturing very soon, then this is a yellow flag. It doesn’t mean don’t buy, but make sure you understand the structure of the company’s debt and make sure it won’t impair the company’s earnings going forward. This information is found on the balance sheet. Abbvie has $97.287 billion in long-term liabilities such as debt, pension liability, and deferred taxes. That’s a lot compared to their assets, but they also are owed some money, so it nets out about $90 billion.
-What’s the book value? Book value is fairly low at $8.65/share. This is pretty much the assets minus the liabilities. Abbvie is in a knowledge industry, however, so you shouldn’t expect their main assets to be physical capital that can be sold. It’s mostly organizational or human capital from their workforce, so this isn’t worrying. If Abbvie was, say, a retailer with stores and land and inventory, you’d want this to be much, much higher for the share price. There’s no easy way to judge this one, unfortunately, but it’s good to look it up and you’ll eventually get a feel for it. No red flags here.
-What are the catastrophic risks that even you or I could think of? For a company in the pharmaceutical space, the obvious answer is regulatory and political risk. Regulatory risk is just want it sounds like – more regulation which can be either costly to comply with or lower profits. This does have an upside, which is that it makes it harder for new competitors to enter a market, so I tend to be rather sanguine about regulatory risk. Political risk is much more severe. This is when politicians decide to either confiscate a company, target it specifically rather than the industry it’s in, or other ways in which the government is involved with taking rather than regulating. In Anglo countries (US/UK/Canada/Australia), the rule of law is typically strong enough that this doesn’t happen much, as there is usually some kind of due process. Places like China, Argentina, Russia, and the EU are much more likely to nationalize or otherwise capriciously penalize a company due to the prevailing political winds. Abbvie has a global footprint, but that also means it’s diversified against such risk. It’s headquartered in the US, so it’s unlikely someone will simply take the entire company.
-Payout ratio? Abbvie has a fairly high payout ratio (80% for the last completed fiscal year of 2019), as they have been aggressively growing the dividend. That’s another good reason to input a much lower G than the last few years. That being said, Abbvie has been around for 8 years (it was spun off of Abbott Labs) and has grown its dividend for the last 7 years and has announced it will this coming year as well. The payout ratio is pretty high, but not worrisome. It suggests a fairly mature company that’s now returning cash to shareholders. I’d say this is not nothing, but less than a yellow flag for me. Any company with 95%+ payout ratio is much more vulnerable to a dividend cut.
-Credit rating? S&P gives Abbvie a BBB+ grade for its unsecured debt. This is a slight downgrade because their balance sheet is currently digesting a big acquisition from early 2020 (Allergan). Moody’s gives it a Baa2 rating for unsecured debt. These are both good, solid, investment-grade credit ratings (if you were buying the bonds of Abbvie). This looks great.
-Does it need a genius? Some companies run on all cylinders because they have a genius at the helm – often a founder. But what you want is a company any dummy can run, because sooner or later any dummy will. Don’t plan to invest long-term in companies that require skilled management. Abbvie is fairly diversified and has an OK pipeline of research. They also can buy little biotech companies that invent something but can’t navigate the regulations to bring it to market. So pondering giants are actually a good thing. Means they’re hard to break.
So, given that there was nothing obviously treacherous in our basic due diligence, and the extreme discount at which our example is selling for, this would be one you might want to buy! This is what I do for all the companies I invest in.
Notice that there is no story, no excitement, no narrative, no counting on good or bad management. Emotion has no place in investing. You also will notice that we took every opportunity to reduce the risk of losing your capital by always sandbagging the estimated value of the company. You never want to pick up nickels in front of a steamroller. You want the investment to be so obvious it hits you in the face like a baseball bat. If you’re ever on the fence, don’t do it. You don’t have to hit home runs – just don’t strike out.
You can be even more conservative in your estimates than I am. If, for instance, you used 5% growth rate for Abbvie’s dividend, you’d still get a present value of $148.57/share vs the current market price of $103.43. Similarly, you could use a higher interest rate, which would also lower the estimated present value.
You may have to do this calculation with more companies to find one to buy, but even in a very expensive market like today’s, there is always an opportunity. You don’t even have to look at little companies. There’s around 500 companies in the S&P – just start with “A” and work your way through all of them.
A quick note about further reading: I very strongly urge most people to actually read as little as possible on this subject once they get the basics. That’s not because there’s not more to learn, but because I would sadly say the majority of what I see and hear is actively bad advice. But if you do want to keep up with financial news and books and chat boards, the best thing to do is find out what the historical returns of the person giving advice are.
Since WWII, the long-run return on the S&P 500 has generally been just a bit shy of 10% per year. If someone can’t beat that, year-in-and-year-out, then their advice is worthless. As in, you don’t want to accidentally absorb it. This is, unfortunately, true for most professionals. Over the last 15 years, 92.2% of actively managed funds have underperformed a simple S&P 500 index fund (and they charge you fees for the privilege). Beware anyone selling something. The advice here is given freely
That’s why I made a point of mentioning that I have and regularly outperform the standard fund almost every year. Granted, I don’t have many of the regulatory restrictions a public fund would have, but it shows how useful the advice I’m giving here is. You don’t need anything fancy. You don’t need anything high risk. I’ve done this through two deep recessions and the longest bull market in history.
If you want to learn more about investing in general and where I learned how to do this, you can read Benjamin Graham’s The Intelligent Investor. It was written in the 1930s, so much of the technical information is out of date. Skip over that and just read it for the concepts.
Even easier reading is to go online to Berkshire Hathaway’s website and pull Warren Buffett and Charlie Munger’s annual letter to shareholders. Almost all of them have something useful in them and don’t make you do equations.
I am available for questions in the comments
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Playboy going public: Porn, Gambling, and Cannabis

NEW INFO 5 Results from share redemption are posted. Less than .2% redeemed. Very bullish as investors are showing extreme confidence in the future of PLBY.
https://finance.yahoo.com/news/playboy-mountain-crest-acquisition-corp-120000721.html
NEW INFO 4 Definitive Agreement to purchase 100% of Lovers brand stores announced 2/1.
https://www.streetinsider.com/Corporate+News/Playboy+%28MCAC%29+Confirms+Deal+to+Acquire+Lovers/17892359.html
NEW INFO 3 I bought more on the dip today. 5081 total. Price rose AH to $12.38 (2.15%)
NEW INFO 2 Here is the full webinar.
https://icrinc.zoom.us/rec/play/9GWKdmOYumjWfZuufW3QXpe_FW_g--qeNbg6PnTjTMbnNTgLmCbWjeRFpQga1iPc-elpGap8dnDv8Zww.yD7DjUwuPmapeEdP?continueMode=true&tk=lEYc4F_FkKlgsmCIs6w0gtGHT2kbgVGbUju3cIRBSjk.DQIAAAAV8NK49xZWdldRM2xNSFNQcTBmcE00UzM3bXh3AAAAAAAAAAAAAAAAAAAAAAAAAAAA&uuid=WN_GKWqbHkeSyuWetJmLFkj4g&_x_zm_rtaid=kR45-uuqRE-L65AxLjpbQw.1611967079119.2c054e3d3f8d8e63339273d9175939ed&_x_zm_rhtaid=866
NEW INFO 1 Live merger webinar with PLBY and MCAC on Friday January 29, 2021 at 12:00 NOON EST link below
https://mcacquisition.com/investor-relations/press-release-details/2021/Playboy-Enterprises-Inc.-and-Mountain-Crest-Acquisition-Corp-Participate-in-SPACInsider-ICR-Webinar-on-January-29th-at-12pm-ET/default.aspx
Playboy going public: Porn, Gambling, and Cannabis
!!!WARNING READING AHEAD!!! TL;DR at the end. It will take some time to sort through all the links and read/watch everything, but you should.
In the next couple weeks, Mountain Crest Acquisition Corp is taking Playboy public. The existing ticker MCAC will become PLBY. Special purpose acquisition companies have taken private companies public in recent months with great success. I believe this will be no exception. Notably, Playboy is profitable and has skyrocketing revenue going into a transformational growth phase.
Porn - First and foremost, let's talk about porn. I know what you guys are thinking. “Porno mags are dead. Why would I want to invest in something like that? I can get porn for free online.” Guess what? You are absolutely right. And that’s exactly why Playboy doesn’t do that anymore. That’s right, they eliminated their print division. And yet they somehow STILL make money from porn that people (see: boomers) pay for on their website through PlayboyTV, Playboy Plus, and iPlayboy. Here’s the thing: Playboy has international, multi-generational name recognition from porn. They have content available in 180 countries. It will be the only publicly traded adult entertainment (porn) company. But that is not where this company is going. It will help support them along the way. You can see every Playboy magazine through iPlayboy if you’re interested. NSFW links below:
https://www.playboy.com/
https://www.playboytv.com/
https://www.playboyplus.com/
https://www.iplayboy.com/
Gambling - Some of you might recognize the Playboy brand from gambling trips to places like Las Vegas, Atlantic City, Cancun, London or Macau. They’ve been in the gambling biz for decades through their casinos, clubs, and licensed gaming products. They see the writing on the wall. COVID is accelerating the transition to digital, application based GAMBLING. That’s right. What we are doing on Robinhood with risky options is gambling, and the only reason regulators might give a shit anymore is because we are making too much money. There may be some restrictions put in place, but gambling from your phone on your couch is not going anywhere. More and more states are allowing things like Draftkings, poker, state ‘lottery” apps, hell - even political betting. Michigan and Virginia just ok’d gambling apps. They won’t be the last. This is all from your couch and any 18 year old with a cracked iphone can access it. Wouldn’t it be cool if Playboy was going to do something like that? They’re already working on it. As per CEO Ben Kohn who we will get to later, “...the company’s casino-style digital gaming products with Scientific Games and Microgaming continue to see significant global growth.” Honestly, I stopped researching Scientific Games' sports betting segment when I saw the word ‘omni-channel’. That told me all I needed to know about it’s success.
“Our SG Sports™ platform is an enhanced, omni-channel solution for online, self-service and retail fixed odds sports betting – from soccer to tennis, basketball, football, baseball, hockey, motor sports, racing and more.”
https://www.scientificgames.com/
https://www.microgaming.co.uk/
“This latter segment has become increasingly enticing for Playboy, and it said last week that it is considering new tie-ups that could include gaming operators like PointsBet and 888Holdings.”
https://calvinayre.com/2020/10/05/business/playboys-gaming-ops-could-get-a-boost-from-spac-purchase/
As per their SEC filing:
“Significant consumer engagement and spend with Playboy-branded gaming properties around the world, including with leading partners such as Microgaming, Scientific Games, and Caesar’s Entertainment, steers our investment in digital gaming, sports betting and other digital offerings to further support our commercial strategy to expand consumer spend with minimal marginal cost, and gain consumer data to inform go-to-market plans across categories.”
https://www.sec.gov/Archives/edgadata/1803914/000110465921005986/tm2034213-12_defm14a.htm#tMDAA1
They are expanding into more areas of gaming/gambling, working with international players in the digital gaming/gambling arena, and a Playboy sportsbook is on the horizon.
https://www.playboy.com/read/the-pleasure-of-playing-with-yourself-mobile-gaming-in-the-covid-era
Cannabis - If you’ve ever read through a Playboy magazine, you know they’ve had a positive relationship with cannabis for many years. As of September 2020, Playboy has made a major shift into the cannabis space. Too good to be true you say? Check their website. Playboy currently sells a range of CBD products. This is a good sign. Federal hemp products, which these most likely are, can be mailed across state lines and most importantly for a company like Playboy, can operate through a traditional banking institution. CBD products are usually the first step towards the cannabis space for large companies. Playboy didn’t make these products themselves meaning they are working with a processor in the cannabis industry. Another good sign for future expansion. What else do they have for sale? Pipes, grinders, ashtrays, rolling trays, joint holders. Hmm. Ok. So it looks like they want to sell some shit. They probably don’t have an active interest in cannabis right? Think again:
https://www.forbes.com/sites/javierhasse/2020/09/24/playboy-gets-serious-about-cannabis-law-reform-advocacy-with-new-partnership-grants/?sh=62f044a65cea
“Taking yet another step into the cannabis space, Playboy will be announcing later on Thursday (September, 2020) that it is launching a cannabis law reform and advocacy campaign in partnership with National Organization for the Reform of Marijuana Laws (NORML), Last Prisoner Project, Marijuana Policy Project, the Veterans Cannabis Project, and the Eaze Momentum Program.”
“According to information procured exclusively, the three-pronged campaign will focus on calling for federal legalization. The program also includes the creation of a mentorship plan, through which the Playboy Foundation will support entrepreneurs from groups that are underrepresented in the industry.” Remember that CEO Kohn from earlier? He wrote this recently:
https://medium.com/naked-open-letters-from-playboy/congress-must-pass-the-more-act-c867c35239ae
Seems like he really wants weed to be legal? Hmm wonder why? The writing's on the wall my friends. Playboy wants into the cannabis industry, they are making steps towards this end, and we have favorable conditions for legislative progress.
Don’t think branding your own cannabis line is profitable or worthwhile? Tell me why these 41 celebrity millionaires and billionaires are dummies. I’ll wait.
https://www.celebstoner.com/news/celebstoner-news/2019/07/12/top-celebrity-cannabis-brands/
Confirmation: I hear you. “This all seems pretty speculative. It would be wildly profitable if they pull this shift off. But how do we really know?” Watch this whole video:
https://finance.yahoo.com/video/playboy-ceo-telling-story-female-154907068.html
Man - this interview just gets my juices flowing. And highlights one of my favorite reasons for this play. They have so many different business avenues from which a catalyst could appear. I think paying attention, holding shares, and options on these staggered announcements over the next year is the way I am going to go about it. "There's definitely been a shift to direct-to-consumer," he (Kohn) said. "About 50 percent of our revenue today is direct-to-consumer, and that will continue to grow going forward.” “Kohn touted Playboy's portfolio of both digital and consumer products, with casino-style gaming, in particular, serving a crucial role under the company's new business model. Playboy also has its sights on the emerging cannabis market, from CBD products to marijuana products geared toward sexual health and pleasure.” "If THC does become legal in the United States, we have developed certain strains to enhance your sex life that we will launch," Kohn said. https://cheddar.com/media/playboy-goes-public-health-gaming-lifestyle-focus Oh? The CEO actually said it? Ok then. “We have developed certain strains…” They’re already working with growers on strains and genetics? Ok. There are several legal cannabis markets for those products right now, international and stateside. I expect Playboy licensed hemp and THC pre-rolls by EOY. Something like this: https://www.etsy.com/listing/842996758/10-playboy-pre-roll-tubes-limited?ga_order=most_relevant&ga_search_type=all&ga_view_type=gallery&ga_search_query=pre+roll+playboy&ref=sr_gallery-1-2&organic_search_click=1 Maintaining cannabis operations can be costly and a regulatory headache. Playboy’s licensing strategy allows them to pick successful, established partners and sidestep traditional barriers to entry. You know what I like about these new markets? They’re expanding. Worldwide. And they are going to be a bigger deal than they already are with or without Playboy. Who thinks weed and gambling are going away? Too many people like that stuff. These are easy markets. And Playboy is early enough to carve out their spot in each. Fuck it, read this too: https://www.forbes.com/sites/jimosman/2020/10/20/playboy-could-be-the-king-of-spacs-here-are-three-picks/?sh=2e13dcaa3e05
Numbers: You want numbers? I got numbers. As per the company’s most recent SEC filing:
“For the year ended December 31, 2019, and the nine months ended September 30, 2020, Playboy’s historical consolidated revenue was $78.1 million and $101.3 million, respectively, historical consolidated net income (loss) was $(23.6) million and $(4.8) million, respectively, and Adjusted EBITDA was $13.1 million and $21.8 million, respectively.”
“In the nine months ended September 30, 2020, Playboy’s Licensing segment contributed $44.2 million in revenue and $31.1 million in net income.”
“In the ninth months ended September 30, 2020, Playboy’s Direct-to-Consumer segment contributed $40.2 million in revenue and net income of $0.1 million.”
“In the nine months ended September 30, 2020, Playboy’s Digital Subscriptions and Content segment contributed $15.4 million in revenue and net income of $7.4 million.”
They are profitable across all three of their current business segments.
“Playboy’s return to the public markets presents a transformed, streamlined and high-growth business. The Company has over $400 million in cash flows contracted through 2029, sexual wellness products available for sale online and in over 10,000 major retail stores in the US, and a growing variety of clothing and branded lifestyle and digital gaming products.”
https://www.sec.gov/Archives/edgadata/1803914/000110465921005986/tm2034213-12_defm14a.htm#tSHCF
Growth: Playboy has massive growth in China and massive growth potential in India. “In China, where Playboy has spent more than 25 years building its business, our licensees have an enormous footprint of nearly 2,500 brick and mortar stores and 1,000 ecommerce stores selling high quality, Playboy-branded men’s casual wear, shoes/footwear, sleepwear, swimwear, formal suits, leather & non-leather goods, sweaters, active wear, and accessories. We have achieved significant growth in China licensing revenues over the past several years in partnership with strong licensees and high-quality manufacturers, and we are planning for increased growth through updates to our men’s fashion lines and expansion into adjacent categories in men’s skincare and grooming, sexual wellness, and women’s fashion, a category where recent launches have been well received.” The men’s market in China is about the same size as the entire population of the United States and European Union combined. Playboy is a leading brand in this market. They are expanding into the women’s market too. Did you know CBD toothpaste is huge in China? China loves CBD products and has hemp fields that dwarf those in the US. If Playboy expands their CBD line China it will be huge. Did you know the gambling money in Macau absolutely puts Las Vegas to shame? Technically, it's illegal on the mainland, but in reality, there is a lot of gambling going on in China. https://www.forbes.com/sites/javierhasse/2020/10/19/magic-johnson-and-uncle-buds-cbd-brand-enter-china-via-tmall-partnership/?sh=271776ca411e “In India, Playboy today has a presence through select apparel licensees and hospitality establishments. Consumer research suggests significant growth opportunities in the territory with Playboy’s brand and categories of focus.” “Playboy Enterprises has announced the expansion of its global consumer products business into India as part of a partnership with Jay Jay Iconic Brands, a leading fashion and lifestyle Company in India.” “The Indian market today is dominated by consumers under the age of 35, who represent more than 65 percent of the country’s total population and are driving India’s significant online shopping growth. The Playboy brand’s core values of playfulness and exploration resonate strongly with the expressed desires of today’s younger millennial consumers. For us, Playboy was the perfect fit.” “The Playboy international portfolio has been flourishing for more than 25 years in several South Asian markets such as China and Japan. In particular, it has strategically targeted the millennial and gen-Z audiences across categories such as apparel, footwear, home textiles, eyewear and watches.” https://www.licenseglobal.com/industry-news/playboy-expands-global-footprint-india It looks like they gave COVID the heisman in terms of net damage sustained: “Although Playboy has not suffered any material adverse consequences to date from the COVID-19 pandemic, the business has been impacted both negatively and positively. The remote working and stay-at-home orders resulted in the closure of the London Playboy Club and retail stores of Playboy’s licensees, decreasing licensing revenues in the second quarter, as well as causing supply chain disruption and less efficient product development thereby slowing the launch of new products. However, these negative impacts were offset by an increase in Yandy’s direct-to-consumer sales, which have benefited in part from overall increases in online retail sales so far during the pandemic.” Looks like the positives are long term (Yandy acquisition) and the negatives are temporary (stay-at-home orders).
https://www.sec.gov/Archives/edgadata/1803914/000110465921006093/tm213766-1_defa14a.htm
This speaks to their ability to maintain a financially solvent company throughout the transition phase to the aforementioned areas. They’d say some fancy shit like “expanded business model to encompass four key revenue streams: Sexual Wellness, Style & Apparel, Gaming & Lifestyle, and Beauty & Grooming.” I hear “we’re just biding our time with these trinkets until those dollar dollar bill y’all markets are fully up and running.” But the truth is these existing revenue streams are profitable, scalable, and rapidly expanding Playboy’s e-commerce segment around the world.
"Even in the face of COVID this year, we've been able to grow EBITDA over 100 percent and revenue over 68 percent, and I expect that to accelerate going into 2021," he said. “Playboy is accelerating its growth in company-owned and branded consumer products in attractive and expanding markets in which it has a proven history of brand affinity and consumer spend.”
Also in the SEC filing, the Time Frame:
“As we detailed in the definitive proxy statement, the SPAC stockholder meeting to vote on the transaction has been set for February 9th, and, subject to stockholder approval and satisfaction of the other closing conditions, we expect to complete the merger and begin trading on NASDAQ under ticker PLBY shortly thereafter,” concluded Kohn.
The Players: Suhail “The Whale” Rizvi (HMFIC), Ben “The Bridge” Kohn (CEO), “lil” Suying Liu & “Big” Dong Liu (Young-gun China gang). I encourage you to look these folks up. The real OG here is Suhail Rizvi. He’s from India originally and Chairman of the Board for the new PLBY company. He was an early investor in Twitter, Square, Facebook and others. His firm, Rizvi Traverse, currently invests in Instacart, Pinterest, Snapchat, Playboy, and SpaceX. Maybe you’ve heard of them. “Rizvi, who owns a sprawling three-home compound in Greenwich, Connecticut, and a 1.65-acre estate in Palm Beach, Florida, near Bill Gates and Michael Bloomberg, moved to Iowa Falls when he was five. His father was a professor of psychology at Iowa. Along with his older brother Ashraf, a hedge fund manager, Rizvi graduated from Wharton business school.” “Suhail Rizvi: the 47-year-old 'unsocial' social media baron: When Twitter goes public in the coming weeks (2013), one of the biggest winners will be a 47-year-old financier who guards his secrecy so zealously that he employs a person to take down his Wikipedia entry and scrub his photos from the internet. In IPO, Twitter seeks to be 'anti-FB'” “Prince Alwaleed bin Talal of Saudi Arabia looks like a big Twitter winner. So do the moneyed clients of Jamie Dimon. But as you’ve-got-to-be-joking wealth washed over Twitter on Thursday — a company that didn’t exist eight years ago was worth $31.7 billion after its first day on the stock market — the non-boldface name of the moment is Suhail R. Rizvi. Mr. Rizvi, 47, runs a private investment company that is the largest outside investor in Twitter with a 15.6 percent stake worth $3.8 billion at the end of trading on Thursday (November, 2013). Using a web of connections in the tech industry and in finance, as well as a hearty dose of good timing, he brought many prominent names in at the ground floor, including the Saudi prince and some of JPMorgan’s wealthiest clients.” https://www.nytimes.com/2013/11/08/technology/at-twitter-working-behind-the-scenes-toward-a-billion-dollar-payday.html Y’all like that Arab money? How about a dude that can call up Saudi Princes and convince them to spend? Funniest shit about I read about him: “Rizvi was able to buy only $100 million in Facebook shortly before its IPO, thus limiting his returns, according to people with knowledge of the matter.” Poor guy :(
He should be fine with the 16 million PLBY shares he's going to have though :)
Shuhail also has experience in the entertainment industry. He’s invested in companies like SESAC, ICM, and Summit Entertainment. He’s got Hollywood connections to blast this stuff post-merger. And he’s at least partially responsible for that whole Twilight thing. I’m team Edward btw.
I really like what Suhail has done so far. He’s lurked in the shadows while Kohn is consolidating the company, trimming the fat, making Playboy profitable, and aiming the ship at modern growing markets.
https://www.reuters.com/article/us-twitter-ipo-rizvi-insight/insight-little-known-hollywood-investor-poised-to-score-with-twitter-ipo-idUSBRE9920VW20131003
Ben “The Bridge” Kohn is an interesting guy. He’s the connection between Rizvi Traverse and Playboy. He’s both CEO of Playboy and was previously Managing Partner at Rizvi Traverse. Ben seems to be the voice of the Playboy-Rizvi partnership, which makes sense with Suhail’s privacy concerns. Kohn said this:
“Today is a very big day for all of us at Playboy and for all our partners globally. I stepped into the CEO role at Playboy in 2017 because I saw the biggest opportunity of my career. Playboy is a brand and platform that could not be replicated today. It has massive global reach, with more than $3B of global consumer spend and products sold in over 180 countries. Our mission – to create a culture where all people can pursue pleasure – is rooted in our 67-year history and creates a clear focus for our business and role we play in people’s lives, providing them with the products, services and experiences that create a lifestyle of pleasure. We are taking this step into the public markets because the committed capital will enable us to accelerate our product development and go-to-market strategies and to more rapidly build our direct to consumer capabilities,” said Ben Kohn, CEO of Playboy.
“Playboy today is a highly profitable commerce business with a total addressable market projected in the trillions of dollars,” Mr. Kohn continued, “We are actively selling into the Sexual Wellness consumer category, projected to be approximately $400 billion in size by 2024, where our recently launched intimacy products have rolled out to more than 10,000 stores at major US retailers in the United States. Combined with our owned & operated ecommerce Sexual Wellness initiatives, the category will contribute more than 40% of our revenue this year. In our Apparel and Beauty categories, our collaborations with high-end fashion brands including Missguided and PacSun are projected to achieve over $50M in retail sales across the US and UK this year, our leading men’s apparel lines in China expanded to nearly 2500 brick and mortar stores and almost 1000 digital stores, and our new men’s and women’s fragrance line recently launched in Europe. In Gaming, our casino-style digital gaming products with Scientific Games and Microgaming continue to see significant global growth. Our product strategy is informed by years of consumer data as we actively expand from a purely licensing model into owning and operating key high-growth product lines focused on driving profitability and consumer lifetime value. We are thrilled about the future of Playboy. Our foundation has been set to drive further growth and margin, and with the committed capital from this transaction and our more than $180M in NOLs, we will take advantage of the opportunity in front of us, building to our goal of $100M of adjusted EBITDA in 2025.”
https://www.businesswire.com/news/home/20201001005404/en/Playboy-to-Become-a-Public-Company
Also, according to their Form 4s, “Big” Dong Liu and “lil” Suying Liu just loaded up with shares last week. These guys are brothers and seem like the Chinese market connection. They are only 32 & 35 years old. I don’t even know what that means, but it's provocative.
https://www.secform4.com/insider-trading/1832415.htm
https://finance.yahoo.com/news/mountain-crest-acquisition-corp-ii-002600994.html
Y’all like that China money?
“Mr. Liu has been the Chief Financial Officer of Dongguan Zhishang Photoelectric Technology Co., Ltd., a regional designer, manufacturer and distributor of LED lights serving commercial customers throughout Southern China since November 2016, at which time he led a syndicate of investments into the firm. Mr. Liu has since overseen the financials of Dongguan Zhishang as well as provided strategic guidance to its board of directors, advising on operational efficiency and cash flow performance. From March 2010 to October 2016, Mr. Liu was the Head of Finance at Feidiao Electrical Group Co., Ltd., a leading Chinese manufacturer of electrical outlets headquartered in Shanghai and with businesses in the greater China region as well as Europe.”
Dr. Suying Liu, Chairman and Chief Executive Officer of Mountain Crest Acquisition Corp., commented, “Playboy is a unique and compelling investment opportunity, with one of the world’s largest and most recognized brands, its proven consumer affinity and spend, and its enormous future growth potential in its four product segments and new and existing geographic regions. I am thrilled to be partnering with Ben and his exceptional team to bring his vision to fruition.”
https://www.businesswire.com/news/home/20201001005404/en/Playboy-to-Become-a-Public-Company
These guys are good. They have a proven track record of success across multiple industries. Connections and money run deep with all of these guys. I don’t think they’re in the game to lose.
I was going to write a couple more paragraphs about why you should have a look at this but really the best thing you can do is read this SEC filing from a couple days ago. It explains the situation in far better detail. Specifically, look to page 137 and read through their strategy. Also, look at their ownership percentages and compensation plans including the stock options and their prices. The financials look great, revenue is up 90% Q3, and it looks like a bright future.
https://www.sec.gov/Archives/edgadata/1803914/000110465921005986/tm2034213-12_defm14a.htm#tSHCF
I’m hesitant to attach this because his position seems short term, but I’m going to with a warning because he does hit on some good points (two are below his link) and he’s got a sizable position in this thing (500k+ on margin, I think). I don’t know this guy but he did look at the same publicly available info and make roughly the same prediction, albeit without the in depth gambling or cannabis mention. You can also search reddit for ‘MCAC’ and very few relevant results come up and none of them even come close to really looking at this thing.
https://docs.google.com/document/d/1gOvAd6lebs452hFlWWbxVjQ3VMsjGBkbJeXRwDwIJfM/edit?usp=sharing
“Also, before you people start making claims that Playboy is a “boomer” company, STOP RIGHT THERE. This is not a good argument. Simply put. The only thing that matters is Playboy’s name recognition, not their archaic business model which doesn’t even exist anymore as they have completely repurposed their business.”
“Imagine not buying $MCAC at a 400M valuation lol. Streetwear department is worth 1B alone imo.”
Considering the ridiculous Chinese growth as a lifestyle brand, he’s not wrong.
Current Cultural Significance and Meme Value: A year ago I wouldn’t have included this section but the events from the last several weeks (even going back to tsla) have proven that a company’s ability to meme and/or gain social network popularity can have an effect. Tik-tok, Snapchat, Twitch, Reddit, Youtube, Facebook, Twitter. They all have Playboy stuff on them. Kids in middle and highschool know what Playboy is but will likely never see or touch one of the magazines in person. They’ll have a Playboy hoodie though. Crazy huh? A lot like GME, PLBY would hugely benefit from meme-value stock interest to drive engagement towards their new business model while also building strategic coffers. This interest may not directly and/or significantly move the stock price but can generate significant interest from larger players who will.
Bull Case: The year is 2025. Playboy is now the world leader pleasure brand. They began by offering Playboy licensed gaming products, including gambling products, direct to consumers through existing names. By 2022, demand has skyrocketed and Playboy has designed and released their own gambling platforms. In 2025, they are also a leading cannabis brand in the United States and Canada with proprietary strains and products geared towards sexual wellness. Cannabis was legalized in the US in 2023 when President Biden got glaucoma but had success with cannabis treatment. He personally pushes for cannabis legalization as he steps out of office after his first term. Playboy has also grown their brand in China and India to multi-billion per year markets. The stock goes up from 11ish to 100ish and everyone makes big gains buying somewhere along the way.
Bear Case: The United States does a complete 180 on marijuana and gambling. President Biden overdoses on marijuana in the Lincoln bedroom when his FDs go tits up and he loses a ton of money in his sports book app after the Fighting Blue Hens narrowly lose the National Championship to Bama. Playboy is unable to expand their cannabis and gambling brands but still does well with their worldwide lifestyle brand. They gain and lose some interest in China and India but the markets are too large to ignore them completely. The stock goes up from 11ish to 13ish and everyone makes 15-20% gains.
TL;DR: Successful technology/e-commerce investment firm took over Playboy to turn it into a porn, online gambling/gaming, sports book, cannabis company, worldwide lifestyle brand that promotes sexual wellness, vetern access, women-ownership, minority-ownership, and “pleasure for all”. Does a successful online team reinventing an antiquated physical copy giant sound familiar? No options yet, shares only for now. $11.38 per share at time of writing. My guess? $20 by the end of February. $50 by EOY. This is not financial advice. I am not qualified to give financial advice. I’m just sayin’ I would personally use a Playboy sports book app while smoking a Playboy strain specific joint and it would be cool if they did that. Do your own research. You’d probably want to start here:
WARNING - POTENTIALLY NSFW - SEXY MODELS AHEAD - no actual nudity though
https://s26.q4cdn.com/895475556/files/doc_presentations/Playboy-Craig-Hallum-Conference-Investor-Presentation-11_17_20-compressed.pdf
Or here:
https://www.mcacquisition.com/investor-relations/default.aspx
Jimmy Chill: “Get into any SPAC at $10 or $11 and you are going to make money.”
STL;DR: Buy MCAC. MCAC > PLBY couple weeks. Rocketship. Moon.
Position: 5000 shares. I will buy short, medium, and long-dated calls once available.
submitted by jeromeBDpowell to SPACs [link] [comments]

SEO is easy. The EXACT process we use to scale our clients' SEO from 0 to 200k monthly traffic and beyond

Hey guys!
There's a TON of content out there on SEO - guides, articles, courses, videos, scams, people yelling about it on online forums, etc etc..
Most of it, however, is super impractical. If you want to start doing SEO TODAY and start getting results ASAP, you'll need to do a TON of digging to figure out what's important and what's not.
So we wanted to make everyone's lives super easy and distill our EXACT process of working w/ clients into a stupid-simple, step-by-step practical guide. And so we did. Here we are.
P.S: startups, and seo loved the guide, so I thought you guys might like it too.

A bit of backstory:

If you guys haven't seen any of my previous posts, me and my co-founder own an SEO/digital marketing agency, and we've worked w/ a ton of clients helping them go from 0 to 200k+ monthly organic traffic. We've also helped some quite big companies grow their organic traffic (from 1M to over 1.8M monthly organic), using the exact same process.
So without further ado, grab your popcorn, and be prepared to stick to the screen for a while, cause this is going to be a long post. Here's everything I am going to cover:

Step #1 - Technical Optimization and On-Page SEO

Step #1 to any SEO initiative is getting your technical SEO right.
Now, some of this is going to be a bit technical, so you might just forward this part to your tech team and just skip ahead to "Step #2 - Keyword Research."
If you DON'T have a tech team and want a super easy tl;dr, do this:
If you’re a bit more tech-savvy, though, read on!

Technical SEO Basics

Sitemap.xml file. A good sitemap shows Google how to easily navigate your website (and how to find all your content!). If your site runs on WordPress, all you have to do is install YoastSEO or Rankmath SEO, and they’ll create a sitemap for you. Otherwise, you can use an online XML Sitemap generation tool.
Proper website architecture. The crawl depth of any page should be lower than 4 (i.e: any given page should be reached with no more than 3 clicks from the homepage). To fix this, you should improve your interlinking (check Step #6 of this guide to learn more).
Serve images in next-gen format. Next-gen image formats (JPEG 2000, JPEG XR, and WebP) can be compressed a lot better than JPG or PNG images. Using WordPress? Just use Smush and it’ll do ALL the work for you. Otherwise, you can manually compress all images and re-upload them.
Remove duplicate content. Google hates duplicate content and will penalize you for it. If you have any duplicate pages, just merge them (by doing a 301 redirect) or delete one or the other.
Update your ‘robots.txt’ file. Hide the pages you don’t want Google to index (e.g: non-public, or unimportant pages). If you’re a SaaS, this would be most of your in-app pages. ]
Optimize all your pages by best practice. There’s a bunch of general best practices that Google wants you to follow for your web pages (maintain keyword density, have an adequate # of outbound links, etc.). Install YoastSEO or RankMath and use them to optimize all of your web pages.
If you DON’T have any pages that you don’t want to be displayed on Google, you DON’T need robots.txt.

Advanced Technical SEO

Now, this is where this gets a bit more web-devvy. Other than just optimizing your website for SEO, you should also focus on optimizing your website speed.
Here’s how to do that:
Both for Mobile and PC, your website should load in under 2-3 seconds. While load speed isn’t a DIRECT ranking factor, it does have a very serious impact on your rankings.
After all, if your website doesn’t load for 5 seconds, a bunch of your visitors might drop off.
So, to measure your website speed performance, you can use Pagespeed Insights. Some of the most common issues we have seen clients facing when it comes to website speed and loading time, are the following:
Want to make your life easier AND fix up all these issues and more? Use WP Rocket. The tool basically does all your optimization for you (if you’re using WordPress, of course).
Lastly, if you want to validate the website speed optimization changes you've made, or if you simply want to test how your current site is performing, you can use Google Page Speed Insights*.*
In May 2020, Google rolled out its Core Web Vitals update, which in layman terms means starting next May (2021), the three most important website load speed metrics you will need to worry for ranking will be:
  1. LCP - Largest Contentful Paint -> under 2.5s
  2. FID - First Input Delay -> under 100ms
  3. CLS - Cumulative Layout Shift -> under 0.1

Step #2 - Keyword Research

Once your website is 100% optimized, it’s time to define your SEO strategy.
The best way to get started with this is by doing keyword research.
First off, you want to create a keyword research sheet. This is going to be your main hub for all your content operations.
You can use the sheet to:
  1. Prioritize content
  2. Keep track of the publishing process
  3. Get a top-down view of your web pages
And here’s what it covers:
Now that you have your sheet (and understand how it works), let’s talk about the “how” of keyword research.

How to do Keyword Research (Step-by-Step Guide)

There are a ton of different ways to do that (check the “further readings” at the end of this section for a detailed rundown).
Our favorite method, however, is as follows…
Start off by listing out your top 5 SEO competitors.
The key here is SEO competitors - competing companies that have a strong SEO presence in the same niche.
Not sure who’s a good SEO competitor? Google the top keywords that describe your product and find your top-ranking competitors.
Run them through SEMrush (or your favorite SEO tool), and you’ll see how well, exactly, they’re doing with their SEO.
Once you have a list of 5 competitors, run each of them through “Organic Research” on SEMrush, and you'll get a complete list of all the keywords they rank on.
Now, go through these keywords one by one and extract all the relevant ones and add them to your sheet.
Once you go through the top SEO competitors, your keyword research should be around 80%+ done.
Now to put some finishing touches on your keyword research, run your top keywords through UberSuggest and let it do its magic. It's going to give you a bunch of keywords associated with the keywords you input.
Go through all the results it's going to give you, extract anything that’s relevant, and your keyword research should be 90% done.
At this point, you can call it a day and move on to the next step. Chances are, over time, you’ll uncover new keywords to add to your sheet and get you to that sweet 100%.

Step #3 - Create SEO Landing Pages

Remember how we collected a bunch of landing page keywords in step #2? Now it’s time to build the right page for each of them! This step is a lot more straightforward than you’d think. First off, you create a custom landing page based on the keyword. Depending on your niche, this can be done in 2 ways:
  1. Create a general template landing page. Pretty much copy-paste your landing page, alter the sub-headings, paraphrase it a bit, and add relevant images to the use-case. You’d go with this option if the keywords you’re targeting are very similar to your main use-case (e.g. “project management software” “project management system”).
  2. Create a unique landing page for each use-case. You should do this if each use-case is unique. For example, if your software doubles as project management software and workflow management software. In this case, you’ll need two completely new landing pages for each keyword.
Once you have a bunch of these pages ready, you should optimize them for their respective keywords.
You can do this by running the page content through an SEO tool. If you’re using WordPress, you can do this through RankMath or Yoast SEO.
Both tools will give you exact instructions on how to optimize your page for the keyword.
If you’re not using WordPress, you can use SurferSEO. Just copy-paste your web page content, and it’s going to give you instructions on how to optimize it.
Once your new landing pages are live, you need to pick where you want to place them on your website. We usually recommend adding these pages to your website’s navigation menu (header) or footer.
Finally, once you have all these new landing pages up, you might be thinking “Now what? How, and when, are these pages going to rank?”
Generally, landing pages are a tad harder to rank than content. See, with content, quality plays a huge part. Write better, longer, and more informative content than your competition, and you’re going to eventually outrank them even if they have more links.
With landing pages, things aren’t as cut and dry. More often than not, you can’t just “create a better landing page.”
What determines rankings for landing page keywords are backlinks. If your competitors have 400 links on their landing pages, while yours has 40, chances are, you’re not going to outrank them.

Step #4 - Create SEO Blog Content

Now, let’s talk about the other side of the coin: content keywords, and how to create content that ranks.
As we mentioned before, these keywords aren’t direct-intent (the Googler isn’t SPECIFICALLY looking for your product), but they can still convert pretty well. For example, if you’re a digital marketing agency, you could rank on keywords like…
After all, anyone looking to learn about lead gen techniques might also be willing to pay you to do it for them.
On top of this, blog post keywords are way easier to rank for than your landing pages - you can beat competition simply by creating significantly better content without turning it into a backlink war.In order to create good SEO content, you need to do 2 things right:
  1. Create a comprehensive content outline
  2. Get the writing part right
Here’s how each of these work...

How to Create a Content Outline for SEO

A content outline is a document that has all the info on what type of information the article should contain Usually, this includes:
Outlines are useful if you’re working with a writing team that isn’t 100% familiar with SEO, allowing them to write content that ranks without any SEO know-how.
At the same time, even if you’re the one doing the writing, an outline can help you get a top-down idea of what you should cover in the article.
So, how do you create an outline? Here’s a simplified step-by-step process…
  1. Determine the target word count. Rule of thumb: aim for 1.5x - 2x whatever your competitor wrote. You can disregard this if your competition was super comprehensive with their content, and just go for the same length instead.
  2. Create a similar header structure as your competition. Indicate for the writer which headers should be h2, which ones h3.
  3. For each header, mention what it’s about. Pro tip - you can borrow ideas from the top 5 ranking articles.
  4. For each header, explain what, exactly, should the writer mention (in simple words).
  5. Finally, do some first-hand research on Reddit and Quora. What are the questions your target audience has around your topic? What else could you add to the article that would be super valuable for your customers?

How to Write Well

There’s a lot more to good content than giving an outline to a writer. Sure, they can hit all the right points, but if the writing itself is mediocre, no one’s going to stick around to read your article.
Here are some essential tips you should keep in mind for writing content (or managing a team of writers):
  1. Write for your audience. Are you a B2B enterprise SaaS? Your blog posts should be more formal and professional. B2C, super-consumer product? Talk in a more casual, relaxed fashion. Sprinkle your content with pop culture references for bonus points!
  2. Avoid fluff. Every single sentence should have some sort of value (conveying information, cracking a joke, etc.). Avoid beating around the bush, and be as straightforward as possible.
  3. Keep your audience’s knowledge in mind. For example, if your audience is a bunch of rocket scientists, you don’t have to explain to them how 1+1=2.
  4. Create a writer guideline (or just steal ours! -> edit: sorry had to remove link due to posting guidelines)
  5. Use Grammarly and Hemingway. The first is like your personal pocket editor, and the latter helps make your content easier to read.
  6. Hire the right writers. Chances are, you’re too busy to write your own content. We usually recommend using ProBlogger or Cult of Copy Job Board (Facebook Group) to source top writing talent.

Step #5 - Start Link-Building Operations

Links are essential if you want your content or web pages to rank.
If you’re in a competitive niche, links are going to be the final deciding factor on what ranks and what doesn’t.
In the VPN niche, for example, everyone has good content. That’s just the baseline. The real competition is in the backlinks.
To better illustrate this example, if you Google “best VPN,” you’ll see that all top-ranking content pieces are almost the same thing. They’re all:
So, the determining factor is links. If you check all the top-ranking articles with the Moz Toolbar Extension, you’ll see that on average, each page has a minimum of 300 links (and some over 100,000!).
Meaning, to compete, you’ll really need to double-down on your link-building effort.
In fact, in the most competitive SEO niches, it’s not uncommon to spend $20,000 per month on link-building efforts alone.
​
Pro Tip
Got scared by the high $$$ some companies spend on link-building? Well, worry not!
Only the most ever-green niches are so competitive. Think, VPN, make money online, health and fitness, dating, CBD, gambling, etc. So you know, the usual culprits.
For most other niches, you can even rank with minimal links, as long as you have top-tier SEO content.
Now, let’s ask the million-dollar question: “how do you do link-building?”

4 Evergreen Link Building Strategies for Any Website

There are a TON of different link building strategies on the web. Broken link building, scholarship link building, stealing competitor links, and so on and so on and so on.
We’re not going to list every single link building strategy out there (mainly because Backlinko already did that in their link building guide).
What we are going to do, though, is list out some of our favorite strategies, and link you to resources where you can learn more:
  1. Broken link building. You find dead pages with a lot of backlinks, reach out to websites that linked to them, and pitch them something like “hey, you linked to this article, but it’s dead. We thought you’d want to fix that. You can use our recent article if you think it’s cool enough.”
  2. Guest posting. Probably the most popular link building strategy. Find blogs that accept guest posts, and send them a pitch! They usually let you include 1-2 do-follow links back to your website.
  3. “Linkable asset” link building. A linkable asset is a resource that is so AWESOME that you just can’t help but link to. Think, infographics, online calculators, first-hand studies or research, stuff like that. The tl;dr here is, you create an awesome resource, and promote the hell out of it on the web.
  4. Skyscraper technique. The skyscraper technique is a term coined by Backlinko. The gist of it is, you find link-worthy content on the web, create something even better, and reach out to the right people.
Most of these strategies work, and you can find a ton of resources on the web if you want to learn more.
However, if you’re looking for something a bit different, oh boy we have a treat for you! We’re going to teach you a link-building strategy that got us around:
...And so much more, all through a single blog post.

Link-Building Case Study: SaaS Marketing

“So, what’s this ancient link-building tactic?”
I hear you asking. It must be something super secretive and esoteric, right?
Secrets learned straight from the link-building monks at an ancient SEO temple…
“Right?”
Well, not quite.
The tactic isn’t something too unusual - it’s pretty famous on the web. This tactic comes in 2 steps:
  1. Figure out where your target audience hangs out (create a list of the channels)
  2. Research the type of content your audience loves
  3. Create EPIC content based on that research (give TONS of value)
  4. Promote the HELL out of it in the channels from step 1
Nothing too new, right?
Well, you’d be surprised how many people don’t use it.
Now, before you start throwing stones at us for overhyping something so simple, let’s dive into the case study:
How we PR’d the hell out of our guide to SaaS marketing (can't add a link, but it's on our blog and it's 14k words long), and got 10k+ traffic as a result.
A few months back when we launched our blog, we were deciding on what our initial content should be about.
Since we specialize in helping SaaS companies acquire new users, we decided to create a mega-authority guide to SaaS marketing (AND try to get it to rank for its respective keyword).
We went through the top-ranking content pieces, and saw that none of them was anything too impressive.
Most of them were about general startup marketing strategies - how to validate your MVP, find a product-market fit, etc.
Pretty “meh,” if you ask us. We believe that the #1 thing founders are looking for when Googling “saas marketing” are practical channels and tactics you can use to acquire new users.
So, it all started off with an idea: create a listicle of the top SaaS marketing tactics out there:
  1. How to create good content to drive users
  2. Promote your content
  3. Rank on Google
  4. Create viral infographics
  5. Create a micro-site
...and we ended up overdoing it, covering 41+ different tactics and case studies and hitting around 14k+ words.
On one hand, oops! On the other hand, we had some pretty epic content on our hands. We even added the Smart Content Filter to make the article much easier to navigate.
Once the article was up, we ran it through some of our clients, friends, and acquaintances, and received some really good feedback.
So, now we knew it was worth promoting the hell out of it.
We came up with a huge list of all online channels that would appreciate this article:
  1. entrepreneur and startups (hi guys!). The first ended up loving the post, netting us ~600 upboats and a platinum medal. The latter also ended up loving the post, but the mods decided to be assholes and remove it for being “self-promotional.” So, despite the community loving the content, it got axed by the mods. Sad. (Fun fact - this one time we tried to submit another content piece on startups with no company names, no links back to our website, or anything that can be deemed promotional. One of the mods removed it for mentioning a link to Ahrefs. Go figure!)
  2. Hacker News. Tons of founders hang out on HN, so we thought they’d appreciate anything SaaS-related. This netted us around ~200+ upvotes and some awesome feedback (thanks HN!)
  3. Submit on Growth Hackers, Indie Hackers, and all other online marketing communities. We got a bunch of love on Indie Hackers, the rest were quite inactive.
  4. Reach out to all personal connects + clients and ask for a share
  5. Run Facebook/Twitter ads. This didn’t particularly work out too well for us, so we dropped it after 1-2 weeks.
  6. Run a Quuu promotion. If you haven’t heard of Quuu, it’s a platform that matches people who want their content to be shared, with people who want their social media profiles running on 100% auto-pilot. We also got “meh” results here - tons of shares, next to no likes or link clicks.
  7. Promoted in SaaS and marketing Facebook groups. This had awesome results both in terms of traffic, as well as making new friends, AND getting new leads.
  8. Promoted in entrepreneur Slack channels. This worked OK - didn’t net us traffic, but got us some new friends.
  9. Emailed anyone we mentioned in the article and asked for a share. Since we mentioned too many high profile peeps and not enough non-celebs, this didn’t work out too well
  10. Emailed influencers that we thought would like the article / give it a share. They didn’t. We were heart-broken.
And accordingly, created a checklist + distribution sheet with all the websites or emails of people we wanted to ping.
Overall, this netted us around 12,000 page views in total, 15+ leads, 6,000 traffic in just 2 promotion days.
As for SEO results, we got a bunch of links. (I would have added screenshots to all of these results, but don't think this subreddit allows it).
A lot of these are no-follow from Reddit, HackerNews, and other submission websites, but a lot of them are also pretty authentic.
The cool part about this link-building tactic is that people link to you without even asking. You create awesome content that helps people, and you get rewarded with links, shares, and traffic!
And as for the cherry on top, only 2 months after publishing the article, it’s ranking on position #28. We’re expecting it to get to page 1 within the new few months and top 3 within the year.

Step #6 - Interlink Your Pages

One of Google's ranking factors is how long your visitors stick around on your website.
So, you need to encourage users reading ONE article, to read, well, the rest of them (or at least browse around your website). This is done through interlinking.
The idea is that each of your web pages should be linked to and from every other relevant page on your site.
Say, an article on "how to make a resume" could link to (and be linked from) "how to include contact info on a resume," "how to write a cover letter," "what's the difference between a CV and a resume," and so on.
Proper interlinking alone can have a significant impact on your website rankings. NinjaOutreach, for example, managed to improve their organic traffic by 40% through better interlinking alone.
So, how do you do interlinking “right?”
First off, make it a requirement for your writers to link to the rest of your content. Add a clause to your writer guidelines that each article should have 10+ links to your other content pieces.
More often than not, they’ll manage to get 60-70% of interlinking opportunities. To get this to 100%, we usually do bi-annual interlinking runs. Here’s how that works.
Pick an article you want to interlink. Let’s say, for example, an article on 'business process management'.
The goal here is to find as many existing articles on your blog, where ‘business process management’ is mentioned so that we can add a link to the article.
Firstly, Google the keyword ‘business process management’ by doing a Google search on your domain. You can use the following query:
site:yourwebsite.com "keyword"
In our case, that’s:
site:example.com “business process management”
You’ll get a complete list of articles that mention the keyword “business process management.
Now, all you have to do is go through each of these, and make sure that the keyword is hyperlinked to the respective article!
You should also do this for all the synonyms of the keyword for this article. For example, “BPM” is an acronym for business process management, so you’d want to link this article there too.

Step #7 - Track & Improve Your Headline CTRs

Article CTRs play a huge role in determining what ranks or not.
Let’s say your article ranks #4 with a CTR of 15%. Google benchmarks this CTR with the average CTR for the position.
If the average CTR for position #4 is 12%, Google will assume that your article, with a CTR of 15% is of high quality, and will reward you with better rankings.
On the other hand, if the average CTR is 18%, Google will assume that your article isn’t as valuable as other ranking content pieces, and will lower your ranking.
So, it’s important to keep track of your Click Through Rates for all your articles, and when you see something that’s underperforming, you can test different headlines to see if they’ll improve CTR.
Now, you’re probably wondering, how do you figure out what’s the average CTR?
Unfortunately, each search result is different, and there's no one size fits all formula for average CTR.
Over the past few years, Google has been implementing a bunch of different types of search results - featured snippet, QAs, and a lot of other types of search results.
So, depending on how many of these clutter and the search results for your given keyword, you’ll get different average CTRs by position.
Rule of thumb, you can follow these values:
Keep in mind these change a lot depending on your industry, PPC competitiveness, 0-click searches, etc...
Use a scraping tool like Screaming Frog to extract the following data from all your web pages:
Delete all the pages that aren’t meant to rank on Google. Then, head over to Google Search Console and extract the following data for all the web pages:
Add all of this data to a spreadsheet.
Now, check what your competition is doing and use that to come up with new headline ideas. Then, put them in the Title Ideas cell for the respective keyword.
For each keyword, come up with 4-5 different headlines, and implement the (seemingly) best title for each article.
Once you implement the change, insert the date on the Date Implemented column. This will help you keep track of progress.
Then, wait for around 3 - 4 weeks to see what kind of impact this change is going to have on your rankings and CTR.
If the results are not satisfactory, record the results in the respective cells, and implement another test for the following month. Make sure to update the Date Implemented column once again.

Step #8 - Keep Track of Rankings & Make Improvements On-The-Go

You’re never really “done” with SEO - you should always keep track of your rankings and see if there’s any room for improvement.
If you wait for an adequate time-frame after publishing a post (6 months to a year) and you’re still seeing next to no results, then it might be time to investigate.
Here’s what this usually looks like for us:
...And that's it.
Hope you guys had a good read and learned a thing or two :) HMU if you have any questions.
If you want to read the full version in a more reader-friendly format, you can check out our SEO process blog post here.
submitted by malchik23 to Entrepreneur [link] [comments]

Please Criticize my GME DD

I think I can trust y'all to be above the circlejerk on a certain other sub so would you please blow your load all over this DD so I can stop huffing copium?
Reasons why I believe GME is a good long term investment:
 
The gaming industry is a high growth market. Currently valued at $156B and expected to reach $200B by the end of 2021.
This means that in order for GameStop to lose revenue they would also need to lose roughly 66% market share, otherwise the high growth of the gaming market alone will keep them afloat.
The thesis that GameStop is the next Blockbuster is predicated on the current trend of market share loss continuing until the company goes bankrupt. There is no doubt in my mind that GameStop needs to pivot into e-commerce in order to gain back lost market share and continue benefiting from their position as a retailer in a high growth market.
Ryan Cohen is the former CEO of Chewy, an e-commerce retailer specializing in pet products which directly competes with Amazon. Chewy has grown from a 400K market cap to over 40B. R.C. recently purchased 9.8% of Gamestop’s outstanding stock through his investment firm RC Ventures LLC. This is his open letter to the GME board written on Nov. 6th.
On Jan. 11th it was confirmed that RC would be joining the GME board alongside two partners from Chewy, CFO Jim Grube and CMO Alan Attal. Given the timing of this move it is logical to conclude that GME may be taking RC’s recommendations to heart.
On Feb. 2nd three additional experts in the e-commerce market were appointed to executive positions within GME: former AWS engineering lead Matt Francis as CTO, Amazon veteran Josh Kreuger as VP of Fulfillment, and former Chewy VP of Customer Service Kelly Durkin as SVP of Customer Care.
Gamestop is poised for a promising earnings report TBA this March due to console release cycles.
GME stock has soared in recent weeks due to wild speculation driven by online forum WSB. Prior to recent events GME stock was shorted over 140% of outstanding float, WSB users saw an opportunity to squeeze the shorts due to the above good news regarding GME long positions. This has provided GME with much needed breathing room to make stock offerings and pay back accrued real estate debt.
Often touted by those bearish on GME is the news that they would be closing over 450 stores in 2020. However this falls in line with the plan RC outlined in his open letter, and I believe this could actually lead to bullish sentiment. If the board of GME is listening to RC then that is good news.
 
 
Why GME may be a decent speculative play:
 
There is good reason to believe that the prevailing market thesis among wall street investment firms is bearish on GME. Source: every interview of wall street insiders conducted on major media outlets, and the fact that they were shorting GME 140% of the outstanding float.
SI% dropped considerably at the end of January as shorts were gradually squeezed out of their positions due to the stock going viral on social media. This suggests that there are at least some who consider shorting GME to be too risky.
SI% is still estimated to be over 100% of the outstanding float, and many investors doubled down on short positions at the peak of the GME hype when the stock soared to $500 a share.
If the market thesis on GME reverses, the short positions will eventually be covered. A correct valuation of share price based on market fundamentals still places it in the $20-30 range in optimistic estimates. This is the range in which I believe that short positions should consider covering IF the prevailing market thesis changes, creating upward momentum.
 
 
Why GME has potential as an insanely lucrative gamble at the same IQ level as Burry's Big Short:
 
This is where we enter into the area of conspiracy theories. This part of the thesis assumes that not only have HFs over shorted the stock beyond the outstanding float, but that the real SI% is much much higher than reported and is being hidden through illegal stock counterfeiting.
The SEC has acknowledged these dangerous activities in other cases. This website has a decent explanation of how HFs take advantage of companies going bankrupt to turn on the money printers.
IF the usual suspects in this counterfeiting ring were planning to take advantage of GameStop’s impending bankruptcy then there could be as many as 30 fake shares for every one FTD.
This is speculation on speculation, and assumes that some very illegal activity has been going on in regards to GME shares. I personally did not make my decision to invest in GME shares based upon this, but it could be important to the overall market thesis regarding GME.
Ok with that disclaimer out of the way, what metrics could we use to determine if this is being done to GME? The site linked above outlines a few key data points which we can use to investigate this practice.
Fails to Deliver data for GME has been compiled here.
GME was one of the most shorted stocks in 2020.
All major media outlets have released opinions that “GameStop is the next Blockbuster”. Citron was releasing pieces attacking GME. While this is circumstantial evidence at best, it does fit the criteria of media attacks. The ongoing media coverage of the GME event is largely negative, describing WSB as a “pump and dump scam” at best.
The WSB GME event was the perfect storm for counterfeiters, IF there were a large number of counterfeit shares being used in “Short Ladder Attacks” they would have been easily disguised in the high volume leading up to GME ATH. When RH restricted users from buying the stock they may have inadvertently revealed the underlying transactions of counterfeit shares being used to push the price down. A deep analysis of the transactions on the day immediately following the RH change may be quite revealing.
IF the above alleged is true then the counterfeiters would have tried their hardest to push the price down on those days. They also have potentially infinite leverage to do so, which is why the concept of a “Short Squeeze” has largely gone extinct. The Shorts can produce an infinite supply of shares to counter buy interest. The only way they can lose is if GameStop makes a turnaround and long investors stay in. They need to do everything they can to get them to sell.
If you have followed through this with me this far then I invite you to come to your own conclusions regarding this issue based upon logical reasoning. Some questions I’d like to ask you:
Was GameStop a good target for share counterfeiting?
Does the FTD data suggest that there was at least some counterfeiting being done?
Is the market’s reaction to the GME event in line with normal expectations?
Are there any other reasonable explanations for the high FTD numbers over the past year?
 
 
This is what I think could be happening right now, assuming the above is correct:
 
GameStop was supposed to go bankrupt.
Counterfeiters that have been consistently preying upon companies in similar situations saw an opportunity to turn on the money printers, which have been going BRRRRRR for all of 2020 at least.
When GME went viral they took advantage of the high volume to attack the share price, preventing a short squeeze.
The goal is to drive the price down all the way to 0. If it is as bad as I think it is, there is 0 chance of the counterfeit shares used to short the stock ever being covered. The shares simply don’t exist, but there are a number of ways they can just keep kicking the can forward and hiding them from the SEC (which is unlikely to do anything meaningful about it even if they did know). However there may be limits to how long they can keep this up.
The ringleaders are either still hoping that everyone jumps off the bandwagon after crashing the stock, or they will take their profits and escape. This is make it or break it for them, and they don’t intend to be around when it breaks.
What happens next is anyone’s guess. I predict something similar to the 2008 financial crisis as the criminals behind this scam leave the DTCC and the FED on the hook after they loot the ship. I bet the biggest players have already fucked off into the sunset.
In Conclusion: GME is a promising company in a high growth industry, however there are indications that they were preyed upon by criminal share counterfeiters, which means that it is a matter of GME vs. criminal billionaires and I’m starting to doubt if my investment was worth the risk even considering a strong belief in Ryan Cohen’s ability to turn things around.
Hindsight is 2020, welcome to 2021. If I was in DFV’s shoes right now I’d be in a fast car heading somewhere far away.
submitted by godofcatsandgoodfood to retardbets [link] [comments]

Is Golden Matrix Group $GMGI About To Surprise Wall Street?

-Golden Matrix, a B2B gaming and sports betting software platform provider with a turn key solution to all customer needs for successfully operating and maintaining an online gaming/sports betting website.
-Golden Matrix has recently filed an application for a Nasdaq Capital Markets Uplist with approval pending.
-Golden Matrix and Playtech announced a collaboration agreement that has just kicked off this month including GMGI's all new Esports & Peer2P apps.
-Golden Matrix reached an agreement with Amelco Gaming to distribute Amelco's leading international sports betting software white labeled in the APAC Region.
-Knutsson Holdings Invests $5M with GMGI purchasing 1 Million shares at $5.00 each.
What is Golden Matrix?
Golden Matrix Group GMGI is a very unique part of the online gambling industry that doesn't get much recognition compared to the actual sports betting companies and casinos, such as Draftkings DKNG or BetMGM. Draftkings for an example is a front-end operator Business to Consumer (B2C), they are what the consumer sees on the app. Where on the other hand, GMGI is the back-end white labeled software platform, Business to Business (B2B). GMGI has everything provided to convert a land based brick and mortar casino to an online casino, including everything from data analytics, games, game management, payment gateways, currencies, languages, 24/7 tech support and more. So what I'm trying to say is Golden Matrix has everything required to setup an online casino or sports betting application. With what's going on in the world today, an online presence is a must. So this is how GMGI and GAN type companies differ from the rest of the online gaming world, as their work is mainly behind the curtains, but are needed in order to run an online casino or sport betting platform.
Seeing Golden Matrix is not a front-end B2C retail casino, they do not have to pay hundreds of thousands or even millions to advertise. As a matter of fact they don't have to pay anything, which in turn keeps the operating expenses nice and low. They make their money by setting up operators at no cost and make their money licensing the front-end casinos, usage, and providing services. It's much more low key, and they don't have to be the bank like all the front end companies such as Draftkings, BetMGM, Bet365, etc...
Continuous Revenue Growth
Here's a brief summary on Golden Matrix's more recent growth. Just since last January (2020) they have grown their operators (Casinos) from 150 to 457 of them today, a 205% Increase, and Registered End Users from 1.5M to 3.9M today, a 160% Increase in the same time frame. Those numbers to me show solid company growth, and the quarterly financials reflected from this growth as Q1 Revenues were $882K, Q2 $1.04M, Q3 $1.49M, and Q4 is expected to exceed $1.7M as quoted by Golden Matrix. Those quarterlies show me that they have grown their revenues by nearly double in the year 2020. I'm expecting these revenues for last year will total approximately $5.1M+ and can do another easy double in 2021 if not more $10.2M+ On top of all this solid core growth GMGI has also been able to maintain profitability for the past nine consecutive quarters, while growing out their top end numbers. The gross profit last quarter (Q3) was 58% and the net income was only roughly $40K. In my opinion this is a good thing considering the competition GAN who trades in the Nasdaq, lost $4.1M during that same third quarter. Profit is profit, which is an complete rarity in this sector. I'm looking forward to seeing the Q4 numbers on or before the March 15th 2021 deadline.
Nasdaq Capital Markets
Golden Matrix filed an application to uplist onto the Nasdaq Capital Markets on August 27th 2020, and are still currently pending approval as it seems to be a very complicated and tedious task jumping all the way from OTC Pink Sheets to Nasdaq. Us GMGI long shareholders have seen many tasks from the company performed over the past 5+ months that come out in 8K filings, such as amending financial reports to Nasdaq formatting, and even creating a audit committee to meet qualifications just as of last week (01-26-21). As for now Golden Matrix is still a hidden gem as much of Wall Street doesn't know about GMGI or can't trade GMGI due to many buying restrictions. I think soon this will change and no longer be hidden with the arrival of up list.
Playtech and Golden Matrix Deals
Playtech and Golden Matrix went began a collaboration agreement around the end of November 2020 that is set to kickoff sometime this month (February). You can find this easily under recent GMGI news right on the company website. What the deal consists of is beneficial to both of them, as Golden Matrix newly designed and built a Esports betting app, Peer2P Betting Games, and a new Artificial Intelligence System (AI-X). Golden Matrix is letting Playtech PTEC.L use and distribute these applications and software exclusively to all of their new and future customers. Playtech is a market leader when it comes to gaming software and technology. Playtech granted non exclusive rights to distribute their most popular games including live dealer games, slots, table games, bingo, and poker to Golden Matrix's 450+ current operators throughout their APAC Region territories. This deal will be very beneficial for Golden Matrix as their foot print will reach the U.S. and European territories through Playtech, who is all over the world, and some states in the U.S. including very popular New Jersey. I expect we may see a significant increase in the top and bottom line growth for Golden Matrix through this significant collaboration deal.
Amelco Sports Betting Distribution Deal
One more recent larger deal was made with Amelco who's out of England U.K. and basically it gives Golden Matrix distribution rights of their premium sports betting software platform where they will offer it throughout their territories in the APAC Region to their 450+ Operators and future ones as well. I think this is a major deal because they will now become a stronger company by providing both Igaming and Sports Betting software vs just having igaming alone. I think this will not only attract more usage from the current 457+ operators and 3.9M end users, but will also have more future operators wanting to do new business with Golden Matrix being a dual distributor of both Igaming and Sports Betting. More customers equals more revenues, which is what we all want to see from any good growing company.
GMGI Obtained a European Gaming License
Golden Matrix recently acquired a Alderney Gaming License in which their CEO Brian Goodman sold to the company though another privately owned company that was holding this license. He sold this license at cost to Golden Matrix. From my understanding there's many benefits to owning this license, and it's not easy to obtain. Playtech their newly partner also holds this same gaming license, along with many other big name casinos. It seems as if GMGI will be expanding from just the APAC Region alone, and now into the European Region as well. Us shareholders didn't receive a lot info on the exact game plan, but it sounds like some expansion into the European Region. I'm looking forward to hearing more about their game plan hopefully in the near future. Europe is the largest gambling market in the whole world, and right under it is the Asia Pacific Region. Let's see what this European Alderney Gaming License has in store for us in the near future.
$5 Million Equity Investment
Just last week Golden Matrix announced they received a $5M equity investment from a strategic Swedish based gaming investor Knutsson Holdings AB. They purchased one million units which consists of 1M restricted shares at $5.00 USD each, and a warrant with a exercise price of $6.00 a share. They only can exercise the warrants once the GMGI share price exceeds $10 a share for a minimum of 10 consecutive trading days. This was all announced when we were trading around $5.50 a share and will only only dilute the outstanding share count from 21.7M shares to 22.7M shares (4.4%) which is minor. This deal brought me that much more confidence in GMGI, because not only did this investment firm valuate the company currently over $5 a share, but they know its worth more as they have been around the block dealing with gaming companies since 1963 (50+ years). They are also the largest shareholder of popular company NETENT who was recently acquired by Evolution Gaming, and are invested in many other gaming companies. Check them out. This deal puts GMGI outstanding shares to 22.7M with a super low share float that's under 12M shares and a low market cap around $116M USD while currently trading in the low $5 a share price range. Ask yourself this one question, if Knutsson Holdings doesn't even get to purchase their other 1M shares for $6M until the price exceeds $10 a share, don't you think they have good confidence GMGI will surpass this price in the near future? I very well believe so, as they have solid growth, and many new business deals into play for this Quarter (Q1) and beyond.
Possible Acquisitions On The Horizon
I personally have very high expectations for Golden Matrix this year including a up list approval onto the Nasdaq Capital Markets Exchange, major new revenue growth from the partnerships mentioned earlier, and of course building their core business stronger then ever. Also if you checkout all the last dozen press releases from the company, the CEO has mentioned several soon to be announced partnerships and possible synergistic acquisitions many times. Now with Golden Matrix sitting on a pile of cash on hand ($10M+) and staying profitable for the past nine consecutive quarters and counting, they could be in a great position to acquire something beneficial for the companies overall top and bottom line growth. I'm keeping my eyes peeled open short term to see what they do on their next move with $10M+ cash, no debt, and being cashflow positive, which is a rarity in this sector as most are bleeding millions of dollars in losses quarter after quarter! I believe with the current $116M Market Cap, 22.7M Outstanding shares, Low <12M share float and the anticipated future growth, this share price around $5.00 is undervalued and a true bargain BUY.
My Position
I hold a long position of GMGI here, and plan to continue holding for the next 3-5 years as the online gambling industry is expected to grow exponentially for quite some time with more and more legalization throughout the U.S. and many other locations. Online gambling will only continue to grow larger and larger yearly. Do some DD on GMGI and you may become a long shareholder like myself.
Note: All of the info provided above including financials can be found on the Golden Matrix website in the investors section.
WWW. GOLDENMATRIX .COM
submitted by Altruistic-Sun-1482 to WallStreetbetsELITE [link] [comments]

TEKK - Tekkorp Digital Acquisition Corp: Who's Who of Gaming Mgmt Teams!

Team has been involved in a substantial number of the digital media, sports, entertainment, leisure and gaming industries’ most significant merger and acquisition transactions, holding key positions at, and transacting with Scientific Games Corp, Inspired Gaming Group, FOX Bets, Ocean Casino Resort, Resorts International Holdings, PokerStars, DraftKings, Mohegan Sun, Caesars Entertainment Corporation, Harrah’s Entertainment, Tropicana Entertainment, Inc., TSG/Sky Betting & Gaming, Facebook, Inc, Wynn Resorts, Dubai World/MGM Resorts
Here's all the Bios. These guys are stellar! TEKK closed at $10.30 today. Still cheap!
If you don't like to read... you don't like to make money!!!!
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Matthew Davey — Chief Executive Officer and Director
Mr. Davey has over 25 years of experience within the digital media, sports, entertainment, leisure and gaming ecosystems, as well as experience in the public sector. He is an experienced public company executive officer and board member. He has served in executive management positions across the gaming technology arena. Over the course of Mr. Davey’s career, he oversaw more than ten mergers and acquisitions and over $1.2 billion in debt and equity capital raised to support the companies he has led.
Most recently, Mr. Davey was Chief Executive Officer of SG Digital, the Digital Division of Scientific Games Corp. (“Scientific Games”) (Nasdaq: SGMS). SG Digital was established following the purchase by Scientific Games of NYX Gaming Group Limited (“NYX”) (formerly TSXV: NYX), where Mr. Davey served as Chief Executive Officer and Director. The NYX acquisition provided Scientific Games with a vehicle to significantly accelerate the scale and breadth of its existing digital gaming business, including the strategic expansion into sports betting. In his capacity as Chief Executive Officer of NYX, Mr. Davey developed and implemented a corporate strategy that generated strong revenue growth. Mr. Davey shaped company strategy to focus on digital gaming supplier platforms and content that provided various gaming operators with the underlying gaming and sports betting systems for their online gaming business. In 2014, Mr. Davey oversaw the initial public offering of NYX, and his experience in the digital media, sports, entertainment, leisure and gaming industries helped NYX recognize momentum as a public company. After the public offering, from 2014 to 2018, Mr. Davey oversaw seven acquisitions which helped establish NYX as one of the fastest growing global B2B real-money digital gaming and sports betting platforms. These acquisitions included:
• OpenBet: In 2016, NYX completed the $385 million acquisition of OpenBet. This was one of the more complex and transformative acquisitions that Mr. Davey oversaw at NYX. Through securing co-investments from William Hill (LSE: WMH), Sky Betting & Gaming and The Stars Group (formerly Nasdaq: TSG, TSX: TSGI), Mr. Davey was able to get the acquisition from Vitruvian Partners completed successfully, winning the deal against much larger and well capitalized competitors. By combining two established and proven B2B betting and gaming suppliers, NYX was well positioned to provide customers with exciting player-driven solutions across all major product verticals and distribution channels. This allowed NYX to become the leading B2B omni-channel sportsbook platform in the market and the supplier to over 300 gaming operators globally with an extensive library of desktop and mobile game titles, including more than 700 on NYX platforms and more than 2,000 on the OpenBet platform.
• Cryptologic/Chartwell: In 2015, NYX completed the $119 million acquisition of Cryptologic and Chartwell. The acquisition provided NYX with more than 400 titles of additional leading gaming content, a broader customer base, and direct exposure to PokerStars and Intercasino, part of the Gamesys Group (LSE: GYS) — two of the world’s largest online casino offerings.
• OnGame: In 2014, NYX completed the distressed acquisition of OnGame, a premier poker content, platform and service provider. This acquisition provided NYX with one of the best poker products in the industry, access to several regulated jurisdictions, and a valuable talent pool that was instrumental in the growth of NYX. The addition of OnGame further established a path for NYX to continue its growth in both European and U.S. markets.
These acquisitions, together with meaningful organic growth, increased NYX’s revenue from $24 million in 2014 to $184 million annualized in 2017. During that time, Mr. Davey helped build NYX to have over 200 customers in the global gaming industry and a team of 1,000 employees. Mr. Davey’s success at NYX ultimately led to its sale to Scientific Games for $631 million in 2018.
Mr. Davey joined Next Gen Gaming, the predecessor to NYX, in 2000 as the Vice President of Technology, was appointed as Executive Director in 2003 and named Chief Executive Officer in 2005. Prior to that, he was the Senior Consultant for Access Systems, a company that specializes in the provision of back-end software for licensed online casinos. Prior to joining Access, Mr. Davey worked for the Northern Territory Government specializing in matters pertaining to the internet and e-commerce along with roles in the Department of Racing and Gaming. Mr. Davey received a Bachelor of Electrical & Electronic Engineering from Northern Territory University, Australia (also known as Charles Darwin University).
Robin Chhabra — President
Mr. Chhabra has been at the forefront of corporate acquisition activity within the digital gaming landscape for over a decade. His prior experience includes leading corporate strategy, M&A, and business development at two of the global leaders in the digital gaming industry, The Stars Group (“TSG”) and William Hill, and a leading supplier, Inspired Gaming Group (Nasdaq: INSE). Mr. Chhabra served on the Group Executive Committees of each of these companies. From 2017 to May 2020, Mr. Chhabra served as Chief Corporate Development Officer at TSG and, from 2019 to August 2020, he also served as the Chief Executive Officer of Fox Bet, a leading U.S. online gaming business which is the product of a landmark partnership between TSG and FOX Sports, a transaction which he led. During that period, Mr. Chhabra led several transactions which transformed TSG into the largest publicly listed online gambling operator in the world by both revenue and market capitalization and one of the most diversified from a product and geographic perspective with revenues of over $2.5 billion. Mr. Chhabra’s M&A experience is extensive and covers multiple global geographies across the digital gaming value chain and includes the following:
• TSG/Flutter Entertainment Merger: In 2019, Mr. Chhabra led the TSG M&A team that was responsible for TSG’s $12.2 billion merger with Flutter Entertainment (LSE: FLTR). The merger between TSG and Flutter Entertainment is the largest transaction in the digital gaming industry to date. The combination created the largest publicly listed online gaming company with approximately 13 million active customers and leading product offerings, which include sports betting, online casino, fantasy sports and poker. The combined entity includes some of the world’s most iconic digital gaming brands such as Fanduel, Fox Bet, Sky Bet, PaddyPower, Betfair, PokerStars and SportsBet. TSG/Flutter Entertainment is one of the most geographically diverse digital gaming and media companies with leading positions in the United States, United Kingdom, Australia, Ireland, Italy, Spain, Germany and Georgia.
• TSG/Sky Betting and Gaming (“SBG”): In 2018, Mr. Chhabra led the acquisition of SBG from CVC Capital Partners and Sky plc, Europe’s largest media company, in a transaction valued at $4.7 billion. At the time of the acquisition SBG was the largest mobile gambling operator in the United Kingdom and one of the fastest growing of the major operators having doubled its online market share in three years. The acquisition of SBG provided TSG with (a) greater revenue diversification, significantly enhanced expertise and exposure to sports betting just ahead of the judicial overturn of The Professional and Amateur Sports Protection Act of 1992 (PASPA) by the U.S. Supreme Court, (b) a leading position within the United Kingdom, the world’s largest regulated online gaming market, (c) improved products and technology as a result of the addition of SBG’s innovative casino and sports book offerings and a portfolio of popular mobile apps, and (d) expertise in deeply integrating sports betting with leading sports media companies, positioning TSG to create more engaging content, deliver faster growth and decrease customer acquisition costs.
• William Hill (LSE: WMH): At William Hill, from 2010 to 2017, Mr. Chhabra served as Group Director of Strategy and Corporate Development where he led several transactions which contributed to William Hill’s transformation from a land-based gambling operator in the United Kingdom to a leading online-led international business. Mr. Chhabra led William Hill’s entry into the U.S. sports betting and online lottery markets with the acquisition of four businesses, including the simultaneous acquisitions of three U.S. sportsbooks, Cal Neva, American Wagering and Brandywine Bookmaking, in 2011 for an aggregate purchase price of $55 million. These businesses ultimately led William Hill to achieve a leading position in the U.S. sports betting market with a market share of 24% in 2019. Additionally, Mr. Chhabra played a key role in structuring William Hill’s successful joint venture with PlayTech Plc (LSE: PTEC) in 2008. The combined entity created one of the largest online gambling businesses in Europe at the time of its formation and led to William Hill’s buyout of Playtech’s interest for $637 million in 2013. Prior to the transaction, William Hill had struggled in its attempt to establish a strong online gaming platform and a meaningful presence outside the United Kingdom.
Mr. Chhabra has also successfully completed four transactions worth over $1.2 billion in Australia, the world’s second largest regulated online gambling market, and various partnerships in Asia. Additionally, he completed several technology and media related transactions, including William Hill’s investment in NYX, where he worked with Mr. Davey on NYX’s transformational acquisition of OpenBet.
Prior to working in the gaming sector, Mr. Chhabra was an equities analyst and a management consultant. Mr. Chhabra received a Bachelor of Science in Economics from the London School of Economics and Political Science.
Eric Matejevich — Chief Financial Officer
Mr. Matejevich is a seasoned gaming executive with extensive experience in both the online gaming and traditional casino industries. From February to August 2019, he served as Trustee and Interim-Chief Executive Officer of Ocean Casino Resort (“Ocean”) (formerly Revel Casino, which had a construction cost of $2.4 billion) in Atlantic City, where he successfully led the management team through an ownership change and operational turnaround effort. Over the course of seven months, Mr. Matejevich managed to reduce the property’s weekly cash burn of $1.5 million to an annualized cash flow run rate in excess of $20 million.
Prior to Ocean, from 2016 to 2018, Mr. Matejevich served as the Chief Financial Officer of NYX. At NYX, he focused his efforts on integrating the company’s many acquisitions and multiple debt refinancings to simplify its capital structure and provided liquidity for growth initiatives. Additionally, Mr. Matejevich was instrumental to the executive team that sold NYX to Scientific Games for $631 million.
Prior to NYX, from 2004 to 2014, Mr. Matejevich was the Chief Financial Officer of Resorts International Holdings and later, from 2011, also the Chief Operating Officer of the Atlantic Club Casino, a property under the Resorts International Holdings umbrella — a Colony Capital (NYSE: CLNY) entity. As Chief Financial Officer, he provided managerial oversight for all finance functions for a six-property casino company with annual gaming revenue exceeding $1.3 billion, 10,000 gaming positions, 7,000 hotel rooms and over 11,000 staff members during his tenure. Mr. Matejevich led the transition effort to integrate a four-casino, $1.3 billion acquisition from Harrah’s Entertainment and Caesars Entertainment (Nasdaq: CZR). As Chief Operating Officer of Atlantic Club, he lobbied for and was successful in obtaining the first internet gaming legislation passed in the United States. The Atlantic Club was the sole New Jersey casino proponent of the legislation.
Prior to serving in various gaming positions, Mr. Matejevich was a Vice President of High Yield Research for Merrill Lynch, where he managed the corporate bond research effort for the gaming and leisure sectors and marketed high yield and other debt transactions totaling $4.8 billion. Mr. Matejevich received a Bachelor of Science in Economics from The Wharton School and a Bachelor of Arts in International Relations from The College of Arts and Sciences at the University of Pennsylvania.
Our Board of Directors
Morris Bailey — Chairman
Over the past 10 years, Mr. Bailey has been a leader in turning around Atlantic City, as well as being among the first gaming executives to embrace online gaming and sports betting in the United States. In his efforts, Mr. Bailey partnered with two of the largest digital gaming companies in the world, PokerStars, part of the Stars Group, and DraftKings (Nasdaq: DKNG). In 2010, Mr. Bailey bought Resorts Atlantic City (“Resorts”) and initiated a comprehensive renovation which allowed for the property to be rebranded and repositioned. In 2012, Mr. Bailey signed an agreement with Mohegan Sun to manage the day-to-day operations of the casino. In addition to Mohegan Sun’s operational expertise and ability to reduce costs via economies of scale, Resorts gained access to their robust customer database. Soon thereafter, Mr. Bailey and his team focused on bringing online gaming to the property. In 2015, Resorts established a platform to engage in online gaming by partnering with PokerStars, now part of the $24 billion Flutter Entertainment, PLC (LSE: FLTR), to operate an online poker room in Atlantic City. In 2018, Resorts announced deals with DraftKings and SBTech to open a sportsbook on-property and online. For 2020 year-to-date, Resorts has performed in the top quartile in internet gross gaming revenue in New Jersey. Mr. Bailey’s efforts in New Jersey helped set the framework for expansion of online sports and gaming throughout the United States.
In addition to his gaming interests, Mr. Bailey has over 50 years of experience in all facets of real estate development, asset M&A, capital markets and operations and is the founder, Chief Executive Officer and Principal of JEMB Realty, a leading real estate development, investment and management organization. Mr. Bailey has notable investment experience within the energy, finance and telecommunications sectors through investments in the Astoria Energy Plant, Basis Investment Group and Xentris Wireless.
Tony Rodio — Director Nominee
Mr. Rodio has nearly four decades of experience in the gaming industry. Most recently, Mr. Rodio served as the Chief Executive Officer and director of Caesars Entertainment Corporation (“Caesars”) (Nasdaq: CZR), one of the world’s most diversified casino-entertainment providers and the most geographically diverse U.S. casino-entertainment company, from April 2019 until its acquisition by Eldorado Resorts, Inc. in July 2020. Mr. Rodio led Caesars through its $17.3 billion merger with Eldorado Resorts, one of the largest transactions in the gaming industry to date. Additionally, Mr. Rodio was instrumental to Caesars’ expansion into the digital gaming industry and oversaw the implementation of new digital segments such as its Scientific Games powered retail sportsbook solution that now operates in various states throughout the U.S. From October 2018 to May 2019, Mr. Rodio served as Chief Executive Officer of Affinity Gaming. Prior to Affinity Gaming, he served as President, Chief Executive Officer and a director of Tropicana Entertainment, Inc. (“Tropicana”) for over seven years, where he was responsible for the operation of eight casino properties in seven different jurisdictions. During his time at Tropicana, Mr. Rodio oversaw a period of unprecedented growth at the company, improving overall financial results with net revenue that increased more than 50% driven by both operational improvements and expansion across regional markets. Mr. Rodio led major capital projects, including the complete renovation of Tropicana Atlantic City and Tropicana’s move to land-based operations in Evansville, Indiana. Each of these initiatives, among others, generated substantial value for Tropicana. Ultimately, Mr. Rodio’s efforts at Tropicana led to its sale to Eldorado Resorts in 2018 for $1.85 billion. Prior to Tropicana, Mr. Rodio held a succession of executive positions in Atlantic City for casino brands, including Trump Marina Hotel Casino, Harrah’s Entertainment (predecessor to Caesars), the Atlantic City Hilton Casino Resort and Penn National Gaming. He has also served as a director of several professional and charitable organizations, including Atlantic City Alliance, United Way of Atlantic County, the Casino Associations of New Jersey and Indiana, AtlantiCare Charitable Foundation and the Lloyd D. Levenson Institute of Gaming Hospitality & Tourism. Mr. Rodio brings extensive knowledge of and experience in the gaming industry, operational expertise, and a demonstrated ability to effectively design and implement company strategy. Mr. Rodio received a Bachelor of Science from Rider University and a Master of Business Administration from Monmouth University.
Marlon Goldstein — Director Nominee
Mr. Goldstein is a licensed attorney with nearly 20 years of experience in the gaming space. He joined The Stars Group (Nasdaq: TSG)(TSX: TSGI) in January 2014 as its Executive Vice-President, Chief Legal Officer and Secretary until his retirement from the company in July 2020 following the merger of TSG with Flutter Entertainment, PLC (LSE: FLTR). Mr. Goldstein also previously served as the Executive Vice-President, Corporate Development and General Counsel of TSG. Mr. Goldstein was also the senior TSG executive based in the United States and was one of the primary architects of TSG’s strategic vision for its U.S.-facing business. During his tenure, TSG grew from an approximately $500 million market-cap company to an approximately $7 billion market-cap company through a combination of organic growth and strategic mergers and acquisitions. Mr. Goldstein participated in numerous M&A transactions and capital markets offerings at TSG, including several transformational transactions in the digital gaming industry. Notable transactions in which Mr. Goldstein was involved include:
• TSG/Flutter Merger: In 2019, TSG merged with Flutter for a $12.2 billion transaction value, the largest transaction in the digital gaming industry to date.
• TSG/Fox Bet Partnership: In 2019, TSG entered into a partnership with FOX Sports to create FOX Bet in the U.S., a leading U.S. online gaming business. Wall Street Research estimates an approximate $1.1 billion valuation for Fox Bet post-partnership with The Stars Group.
• TSG/Sky Betting & Gaming: In 2018, TSG acquired Sky Betting & Gaming, the largest mobile gambling operator in the United Kingdom at the time, for $4.7 billion.
• TSG/CrownBet and William Hill: In 2018, TSG simultaneously acquired CrownBet and William Hill, two Australian operators, for a total of $621 million in a multi-part transaction.
• TSG/PokerStars and Full Tilt Poker: In 2014, TSG acquired The Rational Group, which operated PokerStars and Full Tilt and was the world’s largest poker business, for $4.9 billion.
Through his ability to legally structure large and complex transactions, Mr. Goldstein was integral to TSG’s vision of becoming a full-service online gaming company. Additionally, he assisted in structuring TSG’s capital markets activity, which generated liquidity for acquisitions and strengthened its balance sheet.
Prior to joining TSG, Mr. Goldstein was a principal shareholder in the corporate and securities practice at the international law firm of Greenberg Traurig P.A., where he practiced for almost 13 years. Mr. Goldstein’s practice focused on corporate and securities matters, including mergers and acquisitions, securities offerings, and financing transactions. Additionally, Mr. Goldstein was the founder and co-chair of the firm’s Gaming Practice, a multi-disciplinary team of attorneys representing owners, operators and developers of gaming facilities, manufacturers and suppliers of gaming devices, investment banks and lenders in financing transactions, and Indian tribes in the development and financing of gaming facilities.
Mr. Goldstein brings experience and insight that we believe will be valuable to a potential initial business combination target business. Mr. Goldstein received a Bachelor of Business Administration with a concentration in accounting from Emory University and a Juris Doctorate with highest honors from the University of Florida, College of Law.
Sean Ryan — Director Nominee
Mr. Ryan is a digital media and technology operator with extensive global experience in online payments, e-commerce, marketplaces, mobile ad networks, digital games, enterprise collaboration platforms, blockchain, real money gaming and online music. Since 2014, Mr. Ryan has been serving as Vice President of Business Platform Partnerships at Facebook, Inc. (“Facebook”) (Nasdaq: FB), where he leads a more than 500 person global organization that manages the Payments, Commerce, Novi/Blockhain, Workplace and Audience Network businesses. Prior to his current role, Mr. Ryan was hired in 2011 as the Director of Games Partnerships to lead and grow the global Games business at Facebook. While the Director of Games Partnerships, Mr. Ryan focused on re-shaping Facebook’s games and monetization strategies to derive more value for Facebook, its users and its partners, including the addition of a Real Money Gaming offering in regulated markets. Mr. Ryan’s team helped accelerate a major trend in engagement through cross-platform games and therefore the opportunity to increase users through establishing games on multiple platforms. Prior to joining Facebook, Mr. Ryan created the new social and mobile games division at News Corp, an American multinational mass media corporation controlled by Rupert Murdoch. While at News Corp, Mr. Ryan led the acquisition of Making Fun, a San Francisco social-game start-up, that created News Corp’s games publishing division.
Before joining News Corp., Mr. Ryan founded multiple digital businesses such as Twofish, Meez, Open Wager and SingShot Media. Mr. Ryan co-founded Twofish in 2009, a virtual goods and services platform that provided developers with data analytics and insights for individual application’s digital economies. Twofish was later sold to online payments provider Live Gamer, where Mr. Ryan served on the board of directors. From 2005 to 2008, Mr. Ryan founded and led Meez.com, a social entertainment service combining avatars, web games and virtual worlds. The white label social casino gaming company Open Wager was spun out of Meez and was later sold to VGW Holdings, Mr. Ryan also co-founded SingShot Media, an online karaoke community, which was sold to Electronic Arts (Nasdaq: EA) and merged into its Sims division.
We believe Mr. Ryan’s experience will be valuable to a potential initial business combination target and would provide an expanded perspective on the digital gaming landscape. Mr. Ryan received a Bachelor of Arts from Columbia University and a Master of Business Administration from the University of California, Los Angeles.
Tom Roche — Director Nominee
Mr. Roche has more than 40 years of experience in the gaming industry as a regulator, advisor and independent auditor. Mr. Roche joined Ernst & Young (“EY”) as a partner in 2003 and opened its Las Vegas office. He was subsequently appointed as the Office Managing Partner and Global Gaming Industry Market Leader. In 2016, Mr. Roche relocated to the EY Hong Kong office to supervise the expansion of the EY Global Gaming Industry practice in the Asia Pacific region. Mr. Roche has been integral to numerous transactions that have shaped the current gaming landscape, including:
• Wynn Resorts (Nasdaq: WYNN) initial public offering: Mr. Roche was the lead partner on Wynn Resort’s initial public offering, which raised $450 million in 2002.
• Harrah’s Entertainment/Apollo Management Group & Texas Pacific Group: Mr. Roche headed the regulatory advisory services on the buyout of Harrah’s Entertainment, the world’s largest casino company at the time, for $17.1 billion.
• Dubai World/MGM Resorts: Mr. Roche headed the regulatory and due diligence advisory services to Dubai World in its approximately $5.1 billion investment in MGM. Dubai World bought 28.4 million MGM shares, or 9.5 percent of the casino operator, for $2.4 billion. It then invested $2.7 billion to acquire a 50% stake in MGM’s CityCenter Project, a $7.4 billion 76-acre Las Vegas development of hotels, condos and retail outlets.
• MGM Growth Properties (NYSE: MGP) initial public offering: Mr. Roche provided tax and structural transaction services to MGM Resorts in the creation of MGM Growth Properties, a publicly traded REIT engaged in the acquisition, ownership and leasing of large-scale destination entertainment and leisure resorts. MGM Growth Properties raised $1.05 billion in its 2016 initial public offering.
Mr. Roche also directed EY advisory services to boards and management teams for profit improvement and technology related initiatives. In addition, Mr. Roche provided advisory support to the American Gaming Association on several research projects, including those specifically related to sports betting, the revocation of The Professional and Amateur Sports Protection Act of 1992 (PASPA) and anti-money laundering best practices in the gaming industry. Equally, he has assisted government agencies in numerous international locations with enhancing their regulatory approach to governing the industry especially in the online gambling sector.
Prior to joining Ernst & Young, Mr. Roche served as Deloitte’s National Gaming Industry Leader and as the co-head of Andersen’s Gaming Industry Practice in Las Vegas. In 1989, Mr. Roche was appointed by then Governor of the State of Nevada, Robert Miller, to serve as one of three members of the Nevada State Gaming Control Board for a four-year term, where he was directly responsible for the Audit and New Games Lab Divisions. As a board member, he spent a substantial amount of time assisting global jurisdiction regulators enact gaming legislation in the design of their regulatory structure. During his career, Roche has been involved in numerous public and private offerings of equity and debt securities. His background includes providing casino regulatory consulting services to casino licensees and to federal and state agencies including the National Indian Gaming Commission and the Nevada State Gaming Control Board, and industry associations such as the Nevada Resort Association and the American Gaming Association.
We believe Mr. Roche’s highly regarded reputation as a gaming auditor and advisor in the gaming industry will be valuable for us and a potential business combination target. Mr. Roche is a member of the American Institute of Certified Public Accountants and is licensed by the Nevada State Board of Accountancy and Mississippi State Board of Public Accountancy. He received his Bachelor of Science degree in Accounting from the University of Southern California.
submitted by jorlev to SPACs [link] [comments]

DraftKings - What Price Levels Imply

Crosspost from wsb
Hi everyone, I have started doing weekly valuations and daily market debriefs. What makes me qualified to do this? I work in buyside and get paid to do this.
For this week I look at DraftKings, let me know what names you would like me to do next week as well as your feedback. Here is my non-investment advice on DraftKings.
What’s new: DKNG reported Quarterly adjusted revenues of $133mn (+42% year-over-year (y/y)), which was at the high-end of the pre-announced $131mn-$133mn range. (link) DKNG also reported adjusted EBITDA of -$197mn, better than Wall St. Consensus expectation of -$203mn.
Also with the earnings release, management increased revenue guidance to $540mn to $560mn, and introduced 2021 revenue guidance of $750mn-$850mn (+45% y/y at the midpoint), the consensus estimate was $776mn. This range doesn’t include contributions from Michigan or Virginia, which could both launch online sports betting late this year or early next. Management’s guidance assumes that they continue to operate in all states where they are currently live and announced sport calendars aren’t disrupted.
Valuation Methodology: I continue from my initial valuation of DKNG last week – What’s clear is that more states will legalize betting and more Americans will be exposed to sports betting and online gambling avenues and the market will grow overall. What is less clear, however, is how fast this market will grow. I approach this valuation by starting high level, focusing on the growth of online betting markets, and then following with DKNG’s market share of the future betting markets. I believe DKNG is simply a beneficiary of overall online betting market growth, not some standalone idiosyncratic tech pioneer, therefore I believe starting with Total Available Market (TAM) is the best approach for a valuation here. From Deutsche Bank in their updated Note on DKNG ‘Limited Changes to Forecasts’ “We expect the market to continue to trade shares around TAM and growth trajectory views, much of which will be dictated by the pace of legalization and investors garnering a better understanding of how [that] ultimately flows to net revenue and, down the road, EBITDA.” We use 2025 EBITDA as anything beyond five years is simply impossible to predict. Feel free to disagree with me in the comments and tell me why you disagree.
I try to keep this analysis high level so we can plug and play growth figures for both the market and DKNG’s share of that future market because analyzing line items or on modelling on revenue multiples, is a pointless exercise for growth companies because appreciating from $500M to $5B is way more likely than $100B to $1trn. This is a rapidly changing company in a disruptive industry and it’s stock price reflects expectations of the future of American online gambling and DraftKings’ ability to capture an increasing share of that market growth.
How is the Street valuing DKNG?: Goldman is Neutral rated with a 12-month price target of $53 based on equal parts 2030 EV/EBITDA (discounted), 21.3X 2024 Sales, and a Discounted Cash Flow model.
Morgan Stanley is in-line and equal-weighted with a price target of $37 valuing DKNG on a 18.5x 2025 EBITDA model. 18.5X is a comparable tech multiple.
Deutsche Bank models DKNG at a price target of $48 on a multiples of 25x 2027 EBITDA, discounted at 5% for 5 years. They note that every 10% move in EBITDA from their current forecast is worth ~$4 to their Price Target and every multiple point is ~$2.
Our Model: I start off with management’s 45% y/y growth figure for 2021. I credit DKNG with this growth next year, then crucially, I decrease the growth rate by 5% every year forward, so 40% growth in 22, 35% in 23, etc. because DKNG is starting from a smaller revenue base so 45% will be easier to achieve in 21 than it will be from a higher base in 23.
If the online sports betting and gambling markets grow at these rates from 2020-2025 (about a 35% annual growth rate), and DKNG is able to capture a 23% blended total market share of these markets, at a 30% EBITDA margin and 18.5x EBITDA multiplier (we borrow this from MS), I get a valuation of around $39, implying ~9% downside. Let’s look closer:
I start off by estimating the online sports betting and gambling market size below. I go off the estimated 2020 figure of around $3.14bn – $1.33bn from sports gambling, $1.5bn from iGaming, and $286mm from Daily Fantasy. Next I grow them by the CAGR’s in the previous paragraph and you see the results. For purposes of this valuation I designate this growth profile as my Base case. I don’t want you to stay fixated on the ~35% CAGR but rather to see the effects of the rate on overall market size come 2025. We can argue all day about the numbers, but trying to estimate the growth of the market to the decimal for 5 years out is not an efficient exercise. This is still a nascent market experiencing a lot of disruption with no clear predecessor case studies. We get a TAM of over $14bn in 2025 with our estimates.
Is this a reasonable TAM: Deutsche Bank is a noted Bear on this sort of sports betting TAM Share argument in the 20bn to 25bn range for sports betting. They say in their “A Lot of Unfounded “Expectations” at a Lofty Price; Remain Sell” Note on Penn National, “Said simply, in the period from March 2019 through February 2020, prior to the pandemic, the per adult spend on sports betting (GGNJ adult population) was $51. Given there are 240 mm adults in the US, to arrive at even a $20bn TAM, implied that not only does every state legalize and all 240 mm adults can bet sports on their mobile phones, but that … the adult spend grows by ~65% from this $51 level”. I look at the idea of full legalization and spend per adult in the table below.
To get to our $20bn TAM, indeed every US adult would need to be spending $84 a year on sports betting and online gambling. This ties out with DB’s 65% figure.
Next I estimate the DraftKings’ EBITDA based on the market size and their share of this future market. An important point is DKNG’s promotions and how much it subtracts from top-line revenue. We use 20% here, but management has stated in the past that promotions are generally in the high 20%’s. We give DKNG credit for being able to continue to decrease promotional activity in the future, so for our 2025 EBITDA analysis we settle on 20%. Just for reference, promotions were ~26% in Q1 and Q2 of this year.
I use a healthy 30% EBITDA margin across all levels of market share and market size. As you can see, our Base Case is $785 mm in EBITDA for 2025. Not bad for a company expected to have over negative $400mm in EBITDA for 2020.
Finally, given the current stock price of $42.84 at close on 11/13, what is the implied 2025E EBITDA multiple for all these scenarios?
Every additional turn in the EBITDA multiple adds ~$2 to our price and every additional $100 mm in 2025 EBITDA adds ~$5. If the market grows by only 15%/ year with lower market share and EBITDA margins in our Bear Case, we get a valuation of $14. Likewise, if the market grows at 45%/year with higher market share and EBITDA margins in our Bull Case, we get a $75 valuation.
Upside Risks to Valuation:
  1. Stronger than expected performance in 2021, which could accelerate growth in TAM realizations
  2. Better-than expected margin performance, especially less promotion activity that eats into top-line revenue
  3. DKNG is able to take outsized market share
  4. Favorable regulatory events and large states making progress toward sports betting
Downside Risks to Valuation:
  1. Considerable stock unloaded coming off management lockup agreements from the IPO
  2. TAM expectations becoming more muted, leaving far-out forecasts like the 2025 EBITDA we use being especially vulnerable
  3. Promotional activity could last longer than we think and be a drag on revenue
  4. Greater impact from competitors, leading to decreased market share and/or further necessitated promotional spend
  5. Negative legislative outcomes
If you like this content and want more check out the blog I just started. Here is a link to this post with the model for download and images attached. https://millennialmkts.com/2020/11/15/draftkings-updated-model-dependent-on-betting-market-growth/
submitted by 2021mba_throwaway to investing [link] [comments]

DraftKings - What Price Levels Imply

DraftKings - What Price Levels Imply
Hello degens, I have started doing weekly valuations and daily market debriefs. What makes me qualified to do this? I work in buyside and am semi-literate. Here is my non-investment advice on DraftKings.
What’s new: DKNG reported Quarterly adjusted revenues of $133mn (+42% year-over-year (y/y)), which was at the high-end of the pre-announced $131mn-$133mn range. (link) DKNG also reported adjusted EBITDA of -$197mn, better than Wall St. Consensus expectation of -$203mn.
Also with the earnings release, management increased revenue guidance to $540mn to $560mn, and introduced 2021 revenue guidance of $750mn-$850mn (+45% y/y at the midpoint), the consensus estimate was $776mn. This range doesn’t include contributions from Michigan or Virginia, which could both launch online sports betting late this year or early next. Management’s guidance assumes that they continue to operate in all states where they are currently live and announced sport calendars aren’t disrupted.
Valuation Methodology: I continue from my initial valuation of DKNG last week – What’s clear is that more states will legalize betting and more Americans will be exposed to sports betting and online gambling avenues and the market will grow overall. What is less clear, however, is how fast this market will grow. I approach this valuation by starting high level, focusing on the growth of online betting markets, and then following with DKNG’s market share of the future betting markets. I believe DKNG is simply a beneficiary of overall online betting market growth, not some standalone idiosyncratic tech pioneer, therefore I believe starting with Total Available Market (TAM) is the best approach for a valuation here. From Deutsche Bank in their updated Note on DKNG ‘Limited Changes to Forecasts’ “We expect the market to continue to trade shares around TAM and growth trajectory views, much of which will be dictated by the pace of legalization and investors garnering a better understanding of how [that] ultimately flows to net revenue and, down the road, EBITDA.” We use 2025 EBITDA as anything beyond five years is simply impossible to predict. Feel free to disagree with me in the comments and tell me why you disagree.
I try to keep this analysis high level so we can plug and play growth figures for both the market and DKNG’s share of that future market because analyzing line items or on modelling on revenue multiples, is a pointless exercise for growth companies because appreciating from $500M to $5B is way more likely than $100B to $1trn. This is a rapidly changing company in a disruptive industry and it’s stock price reflects expectations of the future of American online gambling and DraftKings’ ability to capture an increasing share of that market growth.
How is the Street valuing DKNG?: Goldman is Neutral rated with a 12-month price target of $53 based on equal parts 2030 EV/EBITDA (discounted), 21.3X 2024 Sales, and a Discounted Cash Flow model.
Morgan Stanley is in-line and equal-weighted with a price target of $37 valuing DKNG on a 18.5x 2025 EBITDA model. 18.5X is a comparable tech multiple.
Deutsche Bank models DKNG at a price target of $48 on a multiples of 25x 2027 EBITDA, discounted at 5% for 5 years. They note that every 10% move in EBITDA from their current forecast is worth ~$4 to their Price Target and every multiple point is ~$2.
Our Model: I start off with management’s 45% y/y growth figure for 2021. I credit DKNG with this growth next year, then crucially, I decrease the growth rate by 5% every year forward, so 40% growth in 22, 35% in 23, etc. because DKNG is starting from a smaller revenue base so 45% will be easier to achieve in 21 than it will be from a higher base in 23.
If the online sports betting and gambling markets grow at these rates from 2020-2025 (about a 35% annual growth rate), and DKNG is able to capture a 23% blended total market share of these markets, at a 30% EBITDA margin and 18.5x EBITDA multiplier (we borrow this from MS), I get a valuation of around $39, implying ~9% downside. Let’s look closer:
I start off by estimating the online sports betting and gambling market size below. I go off the estimated 2020 figure of around $3.14bn – $1.33bn from sports gambling, $1.5bn from iGaming, and $286mm from Daily Fantasy. Next I grow them by the CAGR’s in the previous paragraph and you see the results. For purposes of this valuation I designate this growth profile as my Base case. I don’t want you to stay fixated on the ~35% CAGR but rather to see the effects of the rate on overall market size come 2025. We can argue all day about the numbers, but trying to estimate the growth of the market to the decimal for 5 years out is not an efficient exercise. This is still a nascent market experiencing a lot of disruption with no clear predecessor case studies.
we get a TAM of over $14bn in 2025 with our estimates
Is this a reasonable TAM: Deutsche Bank is a noted Bear on this sort of sports betting TAM Share argument in the 20bn to 25bn range for sports betting. They say in their “A Lot of Unfounded “Expectations” at a Lofty Price; Remain Sell” Note on Penn National, “Said simply, in the period from March 2019 through February 2020, prior to the pandemic, the per adult spend on sports betting (GGNJ adult population) was $51. Given there are 240 mm adults in the US, to arrive at even a $20bn TAM, implied that not only does every state legalize and all 240 mm adults can bet sports on their mobile phones, but that … the adult spend grows by ~65% from this $51 level”. I look at the idea of full legalization and spend per adult in the table below.
my estimates
To get to our $20bn TAM, indeed every US adult would need to be spending $84 a year on sports betting and online gambling. This ties out with DB’s 65% figure.
Next I estimate the DraftKings’ EBITDA based on the market size and their share of this future market. An important point is DKNG’s promotions and how much it subtracts from top-line revenue. We use 20% here, but management has stated in the past that promotions are generally in the high 20%’s. We give DKNG credit for being able to continue to decrease promotional activity in the future, so for our 2025 EBITDA analysis we settle on 20%. Just for reference, promotions were ~26% in Q1 and Q2 of this year.
I use a healthy 30% EBITDA margin across all levels of market share and market size. As you can see, our Base Case is $785 mm in EBITDA for 2025. Not bad for a company expected to have over negative $400mm in EBITDA for 2020.
my estimates
Finally, given the current stock price of $42.84 at close on 11/13, what is the implied 2025E EBITDA multiple for all these scenarios? Here’s a table summarizing that below:
At the close of 11/13 DKNG is valued at 20.38x our 2025 estimated EBITDA based on our model assumptions and estimates
Every additional turn in the EBITDA multiple adds ~$2 to our price and every additional $100 mm in 2025 EBITDA adds ~$5. If the market grows by only 15%/ year with lower market share and EBITDA margins in our Bear Case, we get a valuation of $14. Likewise, if the market grows at 45%/year with higher market share and EBITDA margins in our Bull Case, we get a $75 valuation.
I layout some clearer BeaBase/Bull Case scenarios at the bottom as well in more detail:
https://preview.redd.it/00glviwy0qz51.png?width=888&format=png&auto=webp&s=79caa9668938824c4a72a08756fc7112f9e68b77
https://preview.redd.it/vnw9yn8x0qz51.png?width=883&format=png&auto=webp&s=6d70a6abf1c30558d116063886e5fb5678d749de
Upside Risks to Valuation:
  1. Stronger than expected performance in 2021, which could accelerate growth in TAM realizations
  2. Better-than expected margin performance, especially less promotion activity that eats into top-line revenue
  3. DKNG is able to take outsized market share
  4. Favorable regulatory events and large states making progress toward sports betting
Downside Risks to Valuation:
  1. Considerable stock unloaded coming off management lockup agreements from the IPO
  2. TAM expectations becoming more muted, leaving far-out forecasts like the 2025 EBITDA we use being especially vulnerable
  3. Promotional activity could last longer than we think and be a drag on revenue
  4. Greater impact from competitors, leading to decreased market share and/or further necessitated promotional spend
  5. Negative legislative outcomes
If you like this content and want more check out the blog I just started. millennialmkts.com
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The NFL's New Love of the Gambling Industry

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