This Week in Alternative Investments - August 11th, 2023

Author

Adam Katz
August 11, 2023

The level of global VC investment reached a 3-year low in July (S&P Global)

Headlines

Bite sized market updates

The level of global VC investment reached a 3-year low in July. The total value of deals was $15.47 billion, as compared to $28.94 billion last July.

WeWork has doubts about its ability to remain in business. The workplace-sharing company lost $349 million in the second quarter.

PayPal launched a U.S. dollar-backed stablecoin. Paypal USD is the first of its kind from a major mainstream fintech company.

A toy Batmobile from 1966 sold for $150,000. The tin toy made in Japan sold for nearly ten times its pre-auction estimate.

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A weekly look behind the scenes of an investment in the Vincent portfolio.

Kusama: Vincent invested in two Yayoi Kusama paintings on behalf of its clients, one of a red pumpkin titled “Red God” and one of a white infinity-net titled “Infinity-Nets (BCO)”. These motifs and colors are two of Kusama’s most well-known.

Market Updates

The total value of global venture capital investment dropped by 46.5% in July. This is according to a report from S&P Global Market Intelligence, which recorded a three-year low in total VC/PE investment worldwide. Additionally, the number of funding rounds dropped by 37% year-over-year, also hitting a three-year low. Only one of the top ten rounds by funding size came from an American company.

The potential failure of WeWork is trouble for the struggling commercial real estate market. The workplace-sharing company has “substantial doubt” about its ability to remain in business, and its financial picture is bleak. WeWork, which was once valued at $47 billion, has seen its market cap drop below $400 million as of this writing, and it carries nearly $3 billion in long-term debt. If it fails and defaults on the nearly 20 million square feet of office space it rents, it will certainly have a negative impact on the office sector of the real estate market.

PayPal became the first major mainstream fintech firm to launch a stablecoin. Launched in partnership with Paxos, Paypal USD (PYUSD) is backed by U.S. dollar deposits and short-term treasuries. Its creation is another sign that crypto is making its way into the mainstream financial world. This also comes just after Congress advanced a bill to establish a regulatory framework for stablecoins in the U.S.

A rare toy Batmobile became the most valuable Batman toy ever sold at auction. The 1966 toy car made by Japanese company Yonezawa sold for $150,000, nearly ten times its pre-auction estimate. It is in “excellent” condition and came with the original box, a particularly hard-to-find item. The last time an item like this sold was seven years ago, for around $14,000.

See disclosures at masterworks.com/cd