Is Netflix Overvalued? LVMH Bets on Private Jets & Crypto Custody Firm BitGo Files for an IPO

Summary

Prof G Markets: Episode Summary

Title: Is Netflix Overvalued? LVMH Bets on Private Jets & Crypto Custody Firm BitGo Files for an IPO
Release Date: July 22, 2025
Host/Author: Vox Media Podcast Network
Participants: Scott Galloway, Ed Elson, Rich Greenfield

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1. Market Overview ([02:12] - [03:30])

Ed Olson opens the episode by providing a snapshot of the previous day's market activities. The major indices ended the day mixed:

• S&P 500: Closed above 6,300 for the first time.
• NASDAQ: Achieved another record close.
• Dow Jones Industrial Average: Ended nearly flat.

Bond markets saw yields on 10-year treasuries fall as traders focused on economic prospects and trade developments. Notably, Verizon stock rose over 4% after surpassing second-quarter earnings expectations and raising its forecasts.

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2. Deep Dive: Netflix's Earnings and Valuation ([03:31] - [12:25])

2.1. Netflix's Q2 Performance ([03:31] - [04:11]) Netflix reported robust second-quarter earnings, surpassing estimates:

• Revenue: Increased by 16% year-over-year to $11 billion.
• Net Profit: Rose by 46% year-over-year to $3.1 billion.
• Full-Year Revenue Forecast: Raised due to healthy member growth and strong ad sales.
• Free Cash Flow: Surged 92% year-over-year to $2.3 billion.
• Operating Margin: Climbed to 34%.

Despite these positive metrics, Netflix's stock declined by over 4% post-report. The company cautioned that spending on upcoming shows and films would reduce the full-year operating margin to 30% from 34%.

2.2. Market Reaction and Rich Greenfield’s Analysis ([04:11] - [07:44]) Producer Claire interviewed Rich Greenfield, co-founder and media and technology analyst at LightShed Partners, to dissect the market's reaction:

• Rich Greenfield ([04:11]): Highlighted that while Netflix dominated the streaming wars with top-line growth in the US (mid-teens) and even faster overseas, the key concern was engagement levels. He stated, “The number one driver of subscribers and the ability to charge more is time spent. That’s the North Star” ([04:34]).
• He questioned whether Netflix's substantial content spending (approximately $17-18 billion annually) was sustainable and effective in driving higher engagement.
• Valuation Concerns ([06:24] - [07:44]): Greenfield emphasized that Netflix remains under 10% in time spent on TV in the US, indicating significant growth potential. However, he pointed out that the company's movie segment hasn't consistently captured audience interest, which is crucial for long-term growth.

2.3. Hosts' Perspective on Netflix's Valuation ([07:45] - [12:25]) Ed Olson and Scott Galloway delve deeper into the valuation debate:

• Ed Olson: Argues that Netflix's impressive quarter contrasts with the stock’s decline, suggesting possible overvaluation. He notes Netflix trades at 52 times earnings, surpassing giants like Disney (25x), Paramount (10x), Nvidia, Apple, Google, and Meta.
• Scott Galloway: Questions whether Netflix's ambitious internal projection to reach a $1 trillion market cap by 2030 is realistic. He cites that much of Netflix’s recent gains stemmed from a Wall Street Journal report predicting this valuation, implying potential overhype.
• Comparative Analysis: Netflix's share in US streaming has slightly declined while competitors like YouTube have increased their market share. Moreover, YouTube achieves higher engagement at a fraction of Netflix’s content spending, making Netflix’s $18 billion budget appear less efficient.
• Conclusion: Olson believes the 5% stock drop signifies market skepticism towards Netflix's lofty valuation and growth expectations, suggesting that the current excitement may not be entirely justified.

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3. LVMH's Investment in Flexjet ([13:42] - [22:14])

3.1. Investment Details ([13:42] - [16:02]) Ed Olson reports that El Caterton, backed by LVMH, has acquired a 20% stake in Flexjet, valuing the private jet company at $4 billion. Flexjet, the world's second-largest private jet company, operates over 300 aircraft and offers fractional ownership to more than 2,000 members. The $800 million investment will primarily fund Flexjet’s infrastructure expansion, including acquiring larger, long-range planes. Flexjet remains under the control of its parent company, Directional Aviation Capital.

3.2. Strategic Significance for LVMH ([16:03] - [19:40]) Scott Galloway and Ed Olson discuss the strategic motives behind LVMH’s investment:

• Luxury Trends: LVMH aims to diversify into the luxury travel sector, aligning with the trend where ultra-wealthy consumers prioritize spending on experiences over material goods. Olson cites statistics showing that 78% of millennials prefer experiences to material items, and in 2024, luxury product spending declined by 2%, while luxury experience spending grew by 5%.
• Integration with Existing Portfolio: LVMH has previously invested in luxury travel through acquisitions like Belmond and partnerships like the one with Accor for developing trains, hotels, and sailing ships under the Orient Express brand. The Flexjet investment complements these efforts by adding a luxury aviation component.
• Scott Galloway’s Insights: Galloway underscores the growing wealth concentration, noting the increase from 500 to 2,500 billionaires in the US over the past decade. He explains that affluent individuals are increasingly valuing time-saving experiences, such as private jet travel, which offers significant personal and time efficiencies. He shares a personal anecdote about saving 13 to 18 days annually through Flexjet membership, illustrating the tangible benefits of such services.

3.3. Discussion and Future Outlook ([19:40] - [22:14])

• Scott Galloway: Suggests that LVMH could further integrate Flexjet with its luxury offerings, creating seamless, high-end travel experiences that combine transportation with exclusive accommodations and services. He envisions a sophisticated integration involving tokenization and limited-access events linked to LVMH’s luxury brands.
• Ed Olson: Playfully remarks on Scott’s influence, noting that LVMH seems to be aligning with the trends Scott has advocated. The conversation emphasizes the strategic alignment between LVMH’s investments and the evolving preferences of wealthy consumers.

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4. Crypto Sector Update: BitGo's IPO ([22:14] - [26:57])

Ed Olson shifts focus to the crypto market, highlighting BitGo's recent filing for an Initial Public Offering (IPO):

• Regulatory Milestone: The Genius Act, signed into law by President Trump, regulates stablecoins (crypto coins pegged to stable assets like the US dollar). This legislation contributed to the crypto sector's total market value surpassing $4 trillion.
• BitGo’s Role: As a leading crypto custody firm, BitGo provides secure storage and movement services for crypto assets. Recently, it expanded into trading, launching platforms for institutional investors to engage in spot options and crypto trading.
• IPO Landscape: BitGo's IPO follows other crypto companies like Circle, which saw a 160% increase post-IPO, and filings from Gemini and Bullish. However, Ed Olson expresses skepticism about the quality of these IPO candidates.

4.1. Critical Analysis of Crypto IPOs ([22:14] - [26:57])

• Quality Concerns: Olson argues that the surge in crypto IPOs often involves low-quality companies with questionable sustainability and legal standings. Examples include:
  • Gemini: Sued by the New York Attorney General for customer fraud.
  • BitGo: Previously unable to deliver audited financial statements and requested non-disclosure of their financials from the SEC.
  • Circle: Derives 99% of its revenues from interest on U.S. treasuries, posing as a tech company without substantial innovation.
• Comparison with Innovators: In contrast, significant innovations continue in private markets with companies like SpaceX, OpenAI, ByteDance, Anthropic, and Stripe, which remain private due to ample venture capital funding.
• Investment Advice: Olson advises against including these crypto IPOs in investment portfolios (e.g., 401(k)s), labeling them as unimpressive and legally entangled. He emphasizes that while the IPO market appears active, it is dominated by companies that do not offer genuine value or innovation.
• Future Outlook: The trend suggests that the real innovation and high-value companies remain in the private sector, leaving the public IPO market cluttered with less promising candidates.

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5. Conclusion ([26:57] - [27:08])

Ed Olson wraps up the episode by summarizing the key discussions:

• Netflix: Despite strong earnings, concerns about overvaluation and engagement levels persist.
• LVMH & Flexjet: Strategic investments highlight the shift toward luxury experiences, particularly private aviation.
• Crypto IPOs: The IPO market is active but riddled with low-quality crypto firms, contrasting with the thriving private innovation sector.

Final Thought: The episode underscores the importance of discerning investment opportunities amidst market hype, emphasizing sustainable growth and genuine value over fleeting trends.

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Notable Quotes

• Ed Olson ([01:43]): "Netflix did warn that spending on some upcoming shows and films will push its full year operating margin down to 30%."
• Rich Greenfield ([04:34]): "The number one driver of subscribers and the ability to charge subscribers more is time spent. That's the North Star."
• Rich Greenfield ([06:08]): "The stock is up what, 45% year to date?... The stock sold off on fear that engagement with the platform was weaker than expected."
• Scott Galloway ([16:34]): "If you want to build a trillion dollar company, you have to build a time machine. Amazon saves you time, Netflix saves you time."
• Ken Ricci ([20:18]): "El Caterton presented us some ideas about where they see the future of luxury. They basically see that the luxury of the future is time."

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This comprehensive summary encapsulates the key discussions, insights, and analyses presented in the episode, providing a clear and engaging overview for listeners and those who haven't tuned in.

Transcript

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[Ed Olson]

Today's number 26. That's how many minutes it takes before the average man gets bored during a shopping trip with his wife or girlfriend. According to the study, many men get so bored that that they actually leave their partner and go home. Put another way, the average man has a six times greater tolerance for Joe Rogan than he does for his partner. Not trying to start a fight, I'm simply stating the facts.

[Scott]

Money market matters.

[Ed Olson]

If money is evil, then that building is hell. Welcome to Property Markets. I'm Ed olson. It is July 22nd. Let's check in on yesterday's market vitals. The major indices ended the day mixed as investors awaited a major week of earnings. The S&P 500 closed above 6,300 for the first time and the NASDAQ notched another record close. Still, the Dow ended nearly flat. The yield on 10 year treasuries fell as bond traders focused on the economy and trade. Meanwhile, Verizon stock rose more than 4% after the company beat second quarter earnings expectations and raised its earnings forecast. Okay, what else is happening? Netflix reported earnings late last week, beating estimates with revenue up 16% year over year to $11 billion. In the second quarter, net profit increased 46% from a year earlier to $3.1 billion. The company also raised its full year revenue forecast due to, quote, healthy member growth and strong ad sales. However, we didn't get any specific updates on those subscription numbers as Netflix has stop reporting that data. Meanwhile, free cash flow surged 92% year over year to $2.3 billion and operating margin climbed to 34%. So overall, a great quarter for Netflix. However, the stock fell more than 4% after that report. Now, Netflix did warn that spending on some upcoming shows and films will push its full year operating margin down to 30%. It declined from 34% in the first half of the year. But, but it does still seem like there must be more to this story. I mean, Netflix beat on virtually every metric and yet Wall street took the stock down. So to break down that reaction from the market, our producer Claire spoke to Rich Greenfield, co founder, partner and media and technology analyst at LightShed Partners.

[Rich Greenfield]

I mean, there was nothing terribly shocking in their results. I mean, I think that's why the stock, you know, is down a little bit right after they reported it's back up today. But look, I think the reality is this is a company that has effectively won the streaming wars and is growing its top line, you know, in the US Mid teens, overseas, even faster. I think the one question coming out of the second quarter call is engagement. You know, I think everyone is looking at, they had a softer period of engagement on the platform. They were growing only slightly, you know, in total. And investors are really looking at, and I think, you know, if you, if you look at the long history of Netflix, the number one driver of subscribers and the ability to charge subscribers more is time spent. That's the North Star. And so the question is, with all, you know, they're spending 17, $18 billion a year on content. Can they spend that better? Do they need to spend more? And I think that's what the street is grappling with, which is just can they drive engagement higher? And is the sort of slowdown in engagement that they've seen, is that a problem or, or just a temporary speed bump as you move through the year into 2026, can you say a little.

[Ed Olson]

Bit more about what exactly took this stock down?

[Rich Greenfield]

Just to be Clear. Like let's just put this in context. The stock is up what, 45% year to date? I mean, so when you say the stock was down a few percent, I mean the net move in the Stock is probably 2% down after a huge move. So the stock has had a huge move on continuing to, quote, unquote, win the streaming wars. The, the stock sold off on fear that engagement with the platform was weaker than expected in the first half of 2025. And will that reverse or is there a problem from YouTube, free streaming services, other subscription streaming services? That's the, the fundamental fear that people are reacting to.

[Ed Olson]

What is your sense of the company's valuation at this point?

[Scott]

Cause like you said, stock had a big run up year to date. It was up 40% before these earnings and I think in the past year it was up around 80%. So what do you make of the valuation now?

[Rich Greenfield]

Look, I think that you're still at, you know, you're still at a relatively small amount of time spent on Netflix. And I think that's really the opportunity is, you know, if you, if you put Netflix, it's sub 10% of time spent in the US let alone looking, you know, on a global basis, but just in the US they represent under 10% of time spent on a TV. There is still a tremendous amount of growth potential ahead for this company. And look, I think the, the main thing, if you think about what's going to drive this stock over the next year, I think it is really execution on the movie side. I think movies is where they have not really performed. I think they've under, I think the overall amount. They've had a lot of movies, people have watched a lot of them, but I don't think they've really captured the zeitgeist. And I think what they're really trying to do, and you're going to see this starting later this month with Happy Gilmore. I think their goal, and if you talk to Ted Sarandos or Bella Bajario, who run content over at Netflix, like they believe that they are going to transform the way you think about their movies over the course of the coming six to nine months. They're going to have a regular cadence of movies that you say those are actually good quality movies that you want to talk to your friends and family about, which I think hasn't been the case as much historically, certainly not as consistently historically.

[Ed Olson]

That was Rich Greenfield, co founder and partner at LightShed Ventures and also our favorite TMT analyst on Wall Street. We hope to have him back on the show soon. Now, one point on which we might differ from Rich, we were a little more interested in the market's reaction to these earnings than it sounds like Rich was. To his point, a 5% drop after a 40% year to date return is, in the grand scheme of things, not a huge deal. But the point still stands. This was a very strong quarter, only one kind of minor soft spot, and yet investors really didn't like it. They were firmly disappointed. And this is striking to us, and we believe it might be indicative of a larger point, which is that the market is clearly looking for reasons to sell Netflix. And that is important because it might tell us something about the valuation, specifically that it might be overvalued. As Rich points it out, Netflix has been a massive outperformer this year, up 40%. It's also trading at 52 times earnings. Compare that to Disney at 25 and Paramount at 10. In fact, Netflix is now valued at roughly the same multiple as Nvidia and a higher multiple than Apple and, and Google and Meta. But Netflix, unlike those companies, isn't diversified. It doesn't have a hardware business or an ad empire or a cloud platform. It has one product, streaming. And in that world, it's even being out competed where it matters most. Time spent. In the past year, YouTube has increased its total share of US streaming views by roughly 3 percentage points. Meanwhile, Netflix's share actually declined slightly. And to rub salt in that wound, YouTube spends three times less per minute of engagement compared to Netflix. And when you hear that stat, Netflix's $18 billion content budget starts to sound less like ammo and more like a liability. So Netflix is a good business, but a half a trillion dollar business. That might be up for debate. Still, the market is extremely excited about Netflix right now. And the big question is why? Well, revenue expanded, the ad model grew, price increases worked. All good news for Netflix. But the really big shift happened a few months ago when the Wall Street Journal reported that Netflix was internally shooting to hit a $1 trillion market cap by 2030. And as soon as that report came out, everyone started buying. In fact, the majority of Netflix's gains this year can be attributed to that report. The Stock has risen 30% since then. Now, on the one hand, you might think, you know, fair enough, management is clearly ambitious and that's a good thing. But on the other hand, is that one report really enough to warrant a valuation that puts Netflix in the same league of growth as Nvidia? Do we believe that this company will hit a trillion dollars in market cap just because management says it will. I'll leave it to you to answer that question. But this is why we think that 5% drop is significant, because we think it is a symptom of the overhype and the overexcitement surrounding Netflix right now. When the Wall Street Journal report came out, everyone got excited and they started loading up on Netflix. They started believing that those internal projections would come true. And then the earnings report comes out and the earnings are great, but we don't see any real indication that this is indeed the next trillion dollar company. And so what does the market do? The market sells. We believe that this will be the prevailing dynamic for Netflix over the next 12 months. And that is huge expectations baked in because of that report, followed up by a series of small disappointments and small stock declines. In fact, Even after that 5% drop, we're still in Nvidia land. We're still looking at a valuation that assumes that this is the next trillion doll. And so the question you have to ask yourself as an investor is do you believe that? Do you believe that Netflix will double revenue in the next five years? And if so, what would that look like? How would that play out? Those are the questions that the market wants the answers to right now. And on this earnings call, Netflix didn't answer them. After the break, a luxury brand powerhouse takes a stake in private aviation. Stay with us.

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[Ed Olson]

We're back with Profit Markets. El Caterton, a private equity firm backed by LVMH, is taking a 20% stake in the private jet company Flexjet. The $800 million investment, which values the company at $4 billion, is the largest ever fundraise in the private aviation industry. As a reminder, flexjet is the second largest private jet company in the world. It operates a fleet of more than 300 aircraft and offers fractional own to more than 2000 members. Most of the proceeds from this investment will go towards expanding flexjet's infrastructure, including the purchase of bigger long range planes. Flexjet will still be controlled by its parent company, Directional Aviation Capital. So we see this as a smart strategic play for LVMH, which jointly owns 40% of Elkatsin along with Bernard Arnault's investment firm. Why? Well, LVMH is a luxury products company. And the new generation of ultra wealthy consumers are increasingly prioritizing spending on experiences. In fact, 78% of millennials report that they would choose to spend on an experience over a material item. And in 2024, while spending on luxury products declined 2%, spending on luxury experiences increased 5%. So LVMH saw this trajectory in the industry and they've been diversifying into travel for a while now. In 2018, the group acquired Belmond, which brought in 46 luxury hotel, restaurant, train and river cruise properties into the portfolio. And last year, they announced a partnership with Accor to develop a series of trains, hotels and sailing ships under the Orient Express brand. And now this flexjet investment will give them a share of the sky, which should unlock the most exclusive travel experiences on offer. So Scott has been predicting this trend for a while, that wealthy people will spend more on travel, more on experiences and less on things, less on products. He's also our resident plane enthusiast. I think we all know that. So let's bring him in to break down what this investment means for LVMH and also for the luxury industry at large. Hey, Scott.

[Scott]

How are you, Ed?

[Ed Olson]

I'm doing well, how are you? How's Aspen?

[Scott]

Aspen is great. I'm about to head to Chicago for a speaking gig. But yeah, it's been. I mean, what's not to like? It's been beautiful here. I've done a couple speaking gigs, so not much of podcasts, so feeling sort of productive, but yeah, I'm good. How are you?

[Ed Olson]

Life is good.

[Scott]

That's right.

[Ed Olson]

I'm doing well. Thank you. Thank you for asking. And the weather looks beautiful there.

[Scott]

It is beautiful.

[Ed Olson]

We want to get your take on this Elcat investment. They're investing in Flexjet, a 20% stake. Your reaction, Scott?

[Scott]

Well, this makes a lot of sense. I think Bernard Arnault is kind of the most important person in business. You don't hear a lot. Wealthiest man in Europe, a real visionary, ability to see around corners. But it taps into a couple pretty big trends. The first is demographic, and that's income inequality. And the fastest growing cohort isn't Latinos or seniors, it's the wealthy. One in 14 people globally is now a millionaire. The number of billionaires in the United States has grown from 500 to 2,500 in the last 10 years. I'm in Aspen, and supposedly there are a hundred billionaires just living in Aspen alone. And that's not a good thing, but it is what it is, and these guys are tapping into that trend that there's just a cohort.

[Ed Olson]

I just want to point out that that is one ninth of all billionaires in the United States. So that's pretty incredible.

[Scott]

That wouldn't surprise me. The other trend is psychographic, and that is Covid, I think hit a lot of people in between the eyes, the kind of, the finite nature of lives. And that is what do really wealthy people have in common? They're usually old. And what do old people have in common who are wealthy? They come to the recognition that they have more money than time. And if you. I've said for a while when we said on this podcast, if you want to build a trillion dollar company, you have to build a time machine. Amazon saves you time, Netflix saves you time. And what you have with private air travel is effectively, and I can speak to this because I'm a member of flexjet. The way you rationalize the irrational is the following. If I can fly private in and out of these speaking gigs in remote areas and not wait in line at TSA and not miss flights, which I do a lot. I calculated that every year Since I joined Flexjet, I save between 13 and 18 days. In other words, I can get home from Kohler, Wisconsin that afternoon instead of leaving the next morning and connecting to Atlanta. And if you think about over 10 years, you're talking about six months with your family. And at the end of your life, granted, you have to have the money, but as you know, I'm not a billionaire, but I'm wealthy. And I've decided to spend a disproportionate amount of my income on private jet travel, because at the end of my life, I don't think I'm going to want the money back. I think I'm going to want another six months with my family. And I think a lot of wealthy people who are blessed are coming to the same conclusion. And as a result, what you see is this continued trend where people are valuing experiences over things. And all research shows that people overestimate the value they get from stuff and underestimate the value they get from experiences. So this taps into a couple really big trends. And just the stat that Mia pulled together that really blew my mind was now that one in six flights tracked by the FAA are private planes. So this market is booming. And I think LVMH has some other cards up their sleeve in terms of integrating with some of their other experiences, hotels and the like.

[Ed Olson]

So I just want to point out you have basically gone around the world explaining this to different groups and different people, people who run companies, people in positions of power, talking about this time machine point. And now let me just read you a quote from Ken Ricci, who's the chairman of flexjet. And he's describing why El Katon invested. He said, quote, el Katterson presented us some ideas about where they see the future of luxury. They basically see that the luxury of the future is time and see that in private travel you can recoup your time. You think they've been listening to you.

[Scott]

So I know Ken and I have advised Bernard Arnault, I don't want to overstate my importance. They did not consult me on this deal. They did not invite me to invest, which I'm a little pissed off about.

[Ed Olson]

Yeah, what the hell, you should be getting commission.

[Scott]

But yeah, we've been. They are singing our song. And I don't. Yes, but yeah, this is an easy one. And then this is what they should do. They should integrate it with the Cheval Blanc. They should create a series of integrated experiences where they offer a group, call it the LV Group, where they integrate flexjet and their Cheval Blanc in Paris or in the Maldives and create one of a kind experiences that create a seamless, integrated handoff between things and experiences. In other words, they can get you there. They can put you up in the nicest hotel in the world and maybe have some amazing products for you once you're there, seamlessly, without decisions. So if they wanted to get really sophisticated, they would tokenize it, have a thousand mint, a thousand LV coins. Each year we get limited products, access to fashion shows. The best room in any Saval Blanc in 100 hours on any one of their Flexjet programs. But anyways, I'm getting ahead of myself, but I'm sure they'll steal that fucking idea in no time. Anyways, go ahead.

[Ed Olson]

Well, I'm glad to hear that I was right.

[Scott]

Do I sound better? Do I sound better?

[Ed Olson]

I was just sort of like, kind of jokingly insinuating it. I've now concluded, I think they actually did listen to you and took a page out of your book.

[Scott]

They're listening to Elson.

[Ed Olson]

I certainly doubt that. Well, thank you, Scott. Enjoy your day and enjoy Aspen.

[Scott]

Thanks, Ed.

[Ed Olson]

Bitgo, one of the largest crypto custody firms in the US has filed for an ipo. This news follows a major regulatory milestone for crypto President Trump signed the Genius act into law last week, legislation that regulates crypto coins that are pegged to stable assets, typically the US dollar, otherwise known as stablecoins. We've discussed that. That news helped push the total market value of the crypto sector above $4 trillion for the first time ever. Now, you may be asking, what is a crypto custody firm? This is a company that helps clients store and move their crypto assets safely. Bitgo also recently expanded into trading, launching a platform for institutional investors to engage in spot options and. And margins crypto trading. So another company has filed for an ipo, and we've seen a lot of IPO headlines recently. We had Circle, another crypto company that recently went public. They're up 160% since they IPO'd. We've seen some other hot new companies preparing to go public. Gemini, another crypto company, they filed last month. Bullish, another crypto company they filed last week. And now Bitgo, which is, of course, another crypto company. So people are quick to say the IPO market is back. The IPO market is heating up. And, you know, maybe it is, maybe it is back, but it also comes with a giant asterisk, and that is most of These hot new IPOs are basically crypto companies that are capitalizing on a new presidential regime, which makes it easier to pump meme coins. But are these good companies? Are these companies that you would want to include in your 401k? Our answer is a resounding no. Most of these companies are unimpressive, and in many cases, they also have a complicated relationship with the law. Gemini, for example, which was sued by the New York Attorney General for defrauding customers. And now we have Bitgo, which was supposed to be acquired three years ago until it was revealed that they couldn't deliver audited financial statements and that was later confirmed by the Delaware Court of Chancery. In fact, Bitgo specifically requested that their financial statements aren't shared with the sec. In other words, this is a company that just a few years ago wasn't even fit to be acquired by another company. But here we are three years later and now they're ready to go public. So this is yet more evidence of a theme we've discussed before, which is that yes, companies are going public, great. But the majority of them are, simply put, low quality companies from Circle, which derives 99% of its revenues from interest on U.S. treasuries. In other words, this is a basket of bonds that is posing as a tech company to Core Weave, which is essentially a subsidiary vehicle for Nvidia to park its chips. We've discussed that before. We discussed that with Gil Luria on another episode to Klarna, which rebranded Credit as Buy Now, Pay later and is now reckoning with a 20% rise in losses due to defaults. These are the kinds of companies that are going public. And now we have Bitgo, which is the same old crypto exchange, crypto custody firm we keep on seeing over and over again. No real innovation here, nothing to really write home about. Meanwhile, all of the real innovation continues to take place in the private markets. It's taking place at SpaceX and OpenAI, ByteDance, Anthropic, Stripe. Those are the companies that are building the real value. But as we've discussed, they're not going public because there's so much money in venture capital now that they don't need to go public, they don't need retail investment. And as a result, the institutions get to invest in SpaceX and you get to invest in Bitgo. That's what you're left with. And that is the reality of the IPO market right now. So, sure, the IPO market is back, it's heating up, they're revving up the engines, however you want to call it. Maybe the IPO market is back, but it's certainly not back in a good way. And it's certainly not back in a way that's going to make us rich. Okay, that's it for today. Thanks for listening to Property Markets from the Vox Media podcast network. I'm Ed Elson. I'll see you tomorrow.

[Rich Greenfield]

You had.

[Advertiser 2]

In kind reunion.

[Scott]

At the.