Rob Vinall on the Meta FB investment thesis

TL;DR

The Metaverse is comparable to the early days of the mobile internet, and Facebook's investment in it is a rational move, although the amount spent may be excessive.

Transcript

what are the what are your thoughts on the metaverse as as a whole and as an investment since one of the your companies is is uh investing in it and it will probably be or is expecting it to be a flow of income so let's start with the metaverse which is obviously um you know facebook which is one of our uh investments recently that renamed itself t... Read More

Key Insights

• 🚗 The Metaverse's potential is uncertain, but similar to the mobile internet, it may become an integral part of our lives with various applications.
• 😨 Facebook's investment in the Metaverse is driven by the fear of missing out on the next significant platform.
• 😘 The $10 billion investment may be considered excessive, but from an investor's standpoint, it is viewed as an option given Facebook's low valuation.
• 😒 The Metaverse's ultimate form and impact are unknown, but time will reveal its potential uses and benefits.
• 👻 Facebook's status as a profitable company allows it to take risks and invest in emerging technologies like the Metaverse.
• 🙈 Facebook's investment in the Metaverse can be seen as an option play since if it fails, the losses are manageable compared to the company's overall value.
• 🌸 The current valuation of Facebook, considering its cash reserves and Metaverse losses, makes it an attractive investment opportunity.

Questions & Answers

Q: How does the Metaverse compare to the early days of the mobile internet?

The Metaverse is reminiscent of the late 90s mobile internet boom, where the concept of mobile internet and its potential uses were uncertain. Similarly, the Metaverse is still in its early stages with undetermined applications.

Q: Why has Facebook invested $10 billion in the Metaverse?

Facebook, now Meta, wants to avoid missing out on the next significant platform. By investing in the Metaverse, they aim to secure their position in the evolving digital landscape.

Q: Is the amount spent by Facebook on the Metaverse excessive?

From a cautious perspective, $10 billion seems excessive considering the current lack of clarity on the Metaverse's future. However, given Facebook's valuation and the potential upside, it is viewed as a rational move.

Q: How does Facebook's investment in the Metaverse impact its profitability?

Facebook, despite being a highly profitable company with $50 billion in operating income, has included $10 billion losses from their Metaverse investment. This shows their commitment to exploring new platforms and securing their future.

Summary & Key Takeaways

• The Metaverse is similar to the initial stages of the mobile internet, with uncertainty surrounding its potential uses and applications.

• Facebook, now Meta, has invested $10 billion in the Metaverse, driven by the desire not to miss out on the next platform.

• The amount invested may be excessive considering the current lack of clarity on what the Metaverse will become, but it is viewed as an option by investors due to Facebook's low valuation.