FT : Hopin founder nets £100m in share sales

Hopin founder nets £100m in share sales
Johnny Boufarhat races to fortune in two years as UK video conferencing company hits $5.7bn valuation

The founder of Hopin, one of the fastest-growing tech startups ever, has sold about £100m of shares over the past year as the video conferencing company’s valuation has rocketed.

Johnny Boufarhat, who launched Hopin two years ago, has sold almost 17 per cent of his stake for between £96m and 130m, according to a Financial Times analysis of public filings.

While founders selling their shares as they raise funds from investors is routine, the quick pace of Hopin’s capital raises has allowed Boufarhat to sell shares faster than most.

Hopin, which was founded shortly before the coronavirus pandemic, has raced to a $5.7bn valuation, raising $565m from top-tier venture capital investors scrambling to invest in video conferencing as lockdowns around the world created a huge demand for remote-working technology.

The company now has 660 employees in 45 countries and says that millions of people attend virtual events run on its platform each month.

Investors including Andreessen Horowitz, Tiger Global and IVP have piled into the company in a series of rapid-fire funding rounds in 2020 and 2021. LinkedIn is among the company’s backers.

On paper, Boufarhat, at 27, is Britain’s youngest self-made billionaire, according to The Sunday Times Rich List.

His investors are effusive about Boufarhat’s qualities. “Johnny will be one of the greatest founders that Europe has ever seen. [He has] one of the most brilliant strategic minds in the business. He’s a truly category-defining leader,” said Harry Stebbings, a Hopin investor.

A filing on Monday at Companies House showed that Boufarhat has sold 16.6m shares since July 2020 in a series of transactions.

The Financial Times cross-referenced those transactions with earlier filings that showed chunks of a share class owned solely by Boufarhat being converted into share classes owned by Hopin’s outside investors.

Other public filings detail the prices paid by investors for various classes of Hopin shares, which the FT used to arrive at a range for Boufarhat’s share sales of £96m-£130m.

Hopin did not comment.

Investors in fast-growing startups may prefer a founder to sell some shares so they are not incentivised to seek an early sale of the company to turn their paper wealth into cash.

Boufarhat has retained control of Hopin in spite of the sales and dilution from new issuances to outside investors with a class of shares that commands 20 votes a piece. All the other shares are one vote a piece.

Such voting structures, which give outsized power to founders, are also common in venture-backed companies.

FT : Oil likely to hit $100 a barrel, say top commodity traders

Oil likely to hit $100 a barrel, say top commodity traders
Executives point to a slowdown in investment in supplies before demand has peaked

The world’s top commodity traders have forecast a return to $100-a-barrel oil, as investment in new supplies slows down before demand has peaked and before green alternatives can take up the slack.

Executives from Vitol, Glencore and Trafigura and Goldman Sachs said on Tuesday that $100 crude was a real possibility, with prices already reaching their highest level in two years this week as Brent crude moved above $73 a barrel.

The prediction comes at a time when concern about inflation is rising and many commodities, such as copper, have already reached record highs, boosted by supply shortfalls as the economic recovery gathers pace.

Oil has lagged behind because of a slowdown in demand during the coronavirus pandemic and fears demand could peak in the next decade. But predictions that prices will move much higher in the next few years have gained momentum in recent weeks.

Jeremy Weir, executive chair of Trafigura, one of the world’s largest independent oil traders, told the FT Commodities Global Summit on Tuesday that he was “concerned” by the lack of spending on new supply because the world was not ready to make the leap to clean energy and complete electrification.


“I actually think that there is a chance for oil to get up to those numbers,” he told the summit. “The issue for oil is not demand . . . the supply situation is quite concerning. We’ve gone from 15 years of reserves to 10 years. We’ve seen capital expenditure go from five years ago at $400bn a year to just $100bn a year. So therefore, there is a concern on the supply side . . . that I think will probably drive prices higher.”

Alex Sanna, the top oil trader at Glencore, also said that $100 oil was looking more likely.

“If you’re cutting supply without at the same time addressing your demand that is when you can get price dislocations,” Sanna said. “You’re really only one or two events away from a material spike in oil prices.”

Oil has not traded above $100 a barrel since 2014, when a surge in supplies from the US shale sector brought the last so-called supercycle to an end. At the start of this century oil prices rallied from near $10 a barrel to reach above $100 in 2008, boosted by growing Chinese demand. Prices, while volatile, averaged around $100 a barrel for the next six years.

Russell Hardy, chief executive of Vitol, the world’s largest independent oil trader, said $100 oil was a “possibility”, though he believes there should be enough spare capacity, with Opec and allies such as Russia still restricting supplies because of the pandemic.

“There’s 5m barrels of spare production being held back from the market today,” Hardy said.

But Jeff Currie at Goldman Sachs, one of the big proponents of oil’s rally last decade, has argued that commodities are looking at a new supercycle as government stimulus measures boost demand.

He believes oil demand will rise because policymakers will use spending on huge green infrastructure projects as stimulus measures aimed at tackling inequality.

“We argue that every $2 trillion of green capex spend is worth about 200,000 barrels per day of oil demand,” he said.

Hardy at Vitol said the trading house believed oil demand would peak around 2030 but that at first demand would not fall sharply initially, instead plateauing well above the 100m barrels a day level it first reached in 2019.

The key period for the risk of an oil supply gap was between 2025 to 2030, he said, and that because of growth in the developing world it would take until 2040 for global oil demand to start falling rapidly.

“Oil demand will probably carry on growing till 2030, obviously dominated by non-OECD and developing markets,” he said.

Marco Dunand, co-founder of Mercuria, said he expected oil demand to recover to pre-pandemic levels and reach bit a bit over 100m b/d by the year’s end, while Torbjörn Törnqvist, chairman of Gunvor, agreed that $100 oil could return and that high prices were needed to incentivise investment in the industry.

Some of the largest oil producers such as BP and Royal Dutch Shell have said their oil production will start to taper in the coming years as they shift investments towards greener forms of energy under pressure from investors.

Equinor, Norway’s state-backed oil company, said on Tuesday that it would put 50 per cent of its capital expenditure towards renewable and low carbon investments by 2030, but did not expect to see its oil output decline until after that date.

>>> US Gapping down

Gapping down

News:

  • PDSB -18.8% (stock offering)
  • SAGE -13.5% (SAGE Therapeutics and Biogen (BIIB) report pivotal Phase 3 results for Zuranolone)
  • VBLT -9.7% (provides an update on its ongoing OVAL Phase 3 study)
  • PING -6.1% (stock offering)
  • VRM -5.8% (convertible notes offering)
  • DCRC -5.6% (Solid Power to list on NASDAQ through merger with Decarbonization Plus Acquisition Corporation III)
  • EARN -4.9% (prices offering of 3.25 mln shares of common stock at $13.20 per share)
  • ABR -4.5% (stock offering)
  • ARE -4.3% (stock offering)
  • CCCC -2.8% (stock offering)
  • PTGX -2.7% (stock offering)
  • FCX -2.2% (Copper futures down 3%)
  • EQNR -2% (sets mid and long term goals in investor presentation)
  • CBRL -1.7% (convertible notes offering)
  • EHTH -1.5% (names new principal financial officer)
  • RIG -1.2% (files mixed securities shelf offering; entered into $400 mln equity distribution agreement with Jefferies)

Analyst comments:

  • FAST -3% (downgraded to Underweight from Equal-Weight at Morgan Stanley)
  • PFG -0.8% (downgraded to Neutral from Overweight at Piper Sandler)

>>> US Gapping up

Gapping up
In reaction to earnings/guidance
:

  • CLF +3.7%, BCOR +1.8%

Other news:

  • CLSD +53.3% (positive safety results from cohort 1 of OASIS Phase 1/2a clinical trial of CLS-AX (axitinib injectable suspension) for the treatment of Wet AMD)
  • FUSN +12.7% (announces preliminary data from FPI-1434 Phase 1 study)
  • AMPE +11.7% (received regulatory approval to expand enrollment of its AP-019 Phase II study to India. The study will utilize inhaled Ampion™ to treat those suffering from respiratory distress due to COVID-19)
  • RAPT +9.1% (extends momentum from +116% move on Monday; also commences $125 mln stock offering)
  • NRXP +8.9% (data from its ZYESAMI Expanded Access Protocol)
  • OTIC +6.4% (initiation of an expansion study for the Phase 1/2 clinical trial of OTO-413 in patients with speech-in-noise hearing difficulty)
  • DPW +4.3% (Ault Global Holdings: Ault & Company agrees to acquire 1 mln shares of its common stock)
  • LEU +4.2% (US Nuclear Regulatory Commission approves license amendment request to produce HALEU)
  • AXSM +3.3% (plan to submit a NDA for AXS-14 for the management of fibromyalgia following a pre-NDA meeting with the FDA)
  • SAVE +2.8% (provides upbeat Q2 guidance and operational trends; leisure demand has continued to improve throughout Q2)
  • BRP +2.5% (to acquire RogersGray)
  • BDSX +2.5% (Biodesix SARS CoV-2 Neutralization Antibody Test now commercially available)
  • CMRE +2.1% (acquires 16 dry bulk vessels)
  • CLLS +1.9% (announces four new product candidates under pre-clinical development; also announces .HEAL, its genome surgery platform)
  • HEAR +1.5% (enters two new market segments with Recon Controller and Velocityone Flight simulation control system)
  • NVAX +1.5% (reports "positive results" from first study of influenza vaccine and COVID-19 vaccine candidate administrated at same time)
  • IBRX +1.3% (receives authorization from FDA for study of Anktiva and PD-L1 t-haNK)

Analyst comments:

  • FOA +6.2% (upgraded to Strong Buy from Outperform at Raymond James)
  • LX +1.9% (upgraded to Overweight from Equal-Weight at Morgan Stanley)
  • WELL +1.1% (upgraded to Strong Buy from Mkt Perform at Raymond James)
  • WPC +0.9% (upgraded to Overweight from Neutral at JP Morgan)

NYT DealBook : What Lordstown’s Meltdown Means for SPACs

What Lordstown’s Meltdown Means for SPACs
Could regulators have stopped the electric car start-up’s implosion?

Could the S.E.C. have stopped the Lordstown implosion?
Lordstown Motors’ founder and C.E.O., Steve Burns, as well its C.F.O., Julio Rodriguez, abruptly resigned yesterday. The departures came as the electric vehicle manufacturer, which went public via a SPAC last year, said a board investigation had found “issues with the accuracy” of claims about orders for its yet-to-be-released electric truck. Shares of Lordstown fell sharply.

The Securities and Exchange Commission is looking into SPAC regulations, but last week said the review wasn’t due until April 2022. In the meantime, what, if anything, can be done to stop this from happening again?


SPACs allow companies to go public earlier than traditional I.P.O.s, in large part because they can rely on projections to tell a story they probably couldn’t by strictly relying on past numbers. (Such projections are not allowed in I.P.O.s.) That can be good for a biotech firm that needs capital for promising research, for example. But it can be dangerous for investors, by allowing start-up execs to spin stories about the demand for, say, electric flying taxis, even if the chance that those vehicles will be widely available is remote.
SPACs are structured such that sponsors are incentivized to get a deal done quickly, even if the company they’re buying may not be ready for public market scrutiny. With electric-vehicle SPAC deals alone, we’ve seen Trevor Milton step down as chairman of Nikola and Ulrich Kranz step down as C.E.O. of Canoo. Both companies have been unable to live up to their rosy projections and, like Lordstown, attracted S.E.C. investigations.
“You’re going to see more of this, frankly,” Tony Aquila, Canoo’s new C.E.O., told DealBook. “That’s the power of the SPAC right?” he said. “You can get to the public markets sooner — but that means you have to grow up in front of the public.”
The S.E.C. could have helped with some of the issues at play here. The commission has said it’s looking at how SPACs treat their projections. If projections weren’t allowed, or if rules forced executives to make more judicious promises, perhaps a company like Lordstown would not have made it into the public market so soon via a SPAC.
But SPACs aren’t the whole problem. Lordstown had disclosed that its pre-orders were nonbinding in its SPAC merger proxy. The S.E.C. didn’t question those orders in an inquiry into Lordstown’s disclosures at the time of its SPAC deal. Would it have been different if the company went public in a traditional I.P.O.? “There are a lot of gray areas with the way I.P.O.s and public companies report orders,” Jay Ritter of the University of Florida, an I.P.O. expert, told DealBook. The order quality issue at Lordstown “is not something that typically gets caught by auditors or in the I.P.O. process,” he said.

Challenges : Rise, le grand pari du moteur vert de Safran et GE

Rise, le grand pari du moteur vert de Safran et GE

Un moteur d’avion ultra-sobre, fonctionnant à 100% de biocarburant ou à hydrogène en 2035: c’est le pari que se lancent le patron de Safran Olivier Andriès et celui de GE Aviation John Slattery. Rencontre.


L’Entente cordiale, version franco-américaine. Deux jours après les accolades de Joe Biden et Emmanuel Macron devant les eaux turquoise de Carbis Bay, en marge du G7 en Cornouailles (Royaume-Uni), c’était au tour des industriels GE et Safran de mettre en scène leur lune de miel, le 14 juin, sur le site Safran Tech du plateau de Saclay. Pour leur première rencontre physique depuis leurs nominations, le patron de GE Aviation, John Slattery, et celui de Safran, Olivier Andriès, avaient une grosse annonce à faire: le lancement des premiers travaux de R&D sur le moteur d’avion du futur, prévu en 2035. Baptisé Rise (Revolutionary Innovation for Sustainable Engines), ce programme doit développer un moteur 20% plus sobre en carburant que les réacteurs actuels, et capable de fonctionner à l’hydrogène liquide ou avec 100% de biocarburants.

"Voyage de 15 ans"
Pourquoi dégainer le projet maintenant, alors que le secteur se débat encore avec la crise du Covid? "Le fondateur de GE, Thomas Edison, disait que son job était de demander à la population quels étaient ses besoins, et d’inventer les solutions pour y répondre, rappelle John Slattery, débarqué de Cincinnati (Ohio) pour l’occasion. Aujourd’hui, l’avenir exige une aviation sans carbone. C’est le défi que nous devons relever." Et qu’importe si GE et Safran ont payé un lourd tribut à la pandémie, supprimant respectivement 25% et 17% de leurs effectifs en 2020, soit 13.000 postes chacun. "Malgré la crise, c’est maintenant qu’il faut investir, estime Olivier Andriès. C’est un voyage de quinze ans que nous entamons. Nous savons qu’il faudra investir des milliards, mais il est de notre responsabilité d’être à l’avant-garde sur cette bataille."
Le DG de Safran Olivier Andriès et le patron de GE Aviation John Slattery (photo Christel Sasso / Capa / Safran)
Les deux partenaires n’en sont pas à leur coup d’essai. Créée en 1974 dans la foulée d'une rencontre entre les présidents Richard Nixon et Georges Pompidou à Reykjavik, leur coentreprise CFM s’est imposée comme une des plus belles success-stories de l’aéronautique. Détenue à 50-50 par les deux industriels, elle a développé le moteur d’avion le plus vendu de l’histoire, le CFM56 (près de 34.000 exemplaires livrés), embarqué sur l’Airbus A320 et le Boeing 737. Elle surfe désormais sur le carton commercial du moteur Leap, qui, depuis 2016, équipe l’A320neo, le 737MAX et le C919 chinois. Avec 18.000 exemplaires vendus, et très peu d’annulations durant la crise, son carnet de commandes est estimé à 270 milliards de dollars. De quoi voir loin: Safran et GE ont annoncé l’extension de leur partenariat jusqu’à 2050. "Cette réussite unique s’explique par un grand respect entre les partenaires, mais aussi par l’équilibre du projet: chaque industriel est responsable de 50% du moteur", explique Olivier Andriès.
Moteur révolutionnaire
Le programme Rise se veut le troisième étage de la fusée CFM. "Nouveau design, nouveaux matériaux, hybridation... Nous voulons que ce moteur soit une révolution", résume John Slattery. GE et Safran envisagent un design dit "open fan", c'est-à-dire un moteur sans carénage. Ce choix technique permet des soufflantes de plus grand diamètre, et donc un moteur à meilleur rendement énergétique. Au-delà du verdissement de l’aviation, l'objectif de ce pari technologique est également de maintenir à distance une concurrence redoutable (Pratt & Whitney, Rolls-Royce et le nouvel entrant chinois Aero Engine Corporation of China). "Cela leur prendra dix ans, peut-être vingt ans, mais les acteurs chinois finiront par s’imposer sur le marché, prédit Olivier Andriès. C’est pour cette raison que nous nous focalisons sur des technologies de rupture. S’il y a une disruption sur le marché, nous voulons qu’elle vienne de chez nous.
Configurations possibles d'avions monocouloirs avec le futur moteur Rise (infographie CFM International)
Pour mener cette guerre sans merci, les deux patrons ont un atout majeur: ils sont loin d’être des perdreaux de l’année. Avant de débarquer en septembre 2020 à la tête de GE Aviation, une division qui pèse un tiers de l’activité du géant General Electric, John Slattery, 52 ans, a dirigé onze ans durant la branche commerciale du brésilien Embraer, troisième avionneur mondial. Quant à Olivier Andriès, X-Mines de 59ans, c’est l’un des derniers Lagardère boys en activité . Conseiller spécial de Jean-Luc à la fin des années 1990, il avait piloté les programmes de longs courriers puis la stratégie d’Airbus, avant de diriger quasiment toutes les divisions de Safran (défense-sécurité, Turbomeca, puis l'ex-Snecma Safran Aircraft Engines). Et de succéder, le 1er janvier dernier, à Philippe Petitcolin, avec lequel ses relations étaient notoirement fraîches.
Perspectives positives

S’ils ne nient pas la violence de la crise actuelle, les deux dirigeants assurent voir le bout du tunnel. Le trafic aérien? "Il est déjà revenu à la normale en Chine et les Etats-Unis redécollent fort, indique Olivier Andriès. On devrait voir un retour à la normale sur les monocouloirs en 2023, et peut-être en 2024-2025 sur les longs courriers." Le 737 MAX de Boeing, motorisé par CFM, et dont la production a repris après vingt mois d’interdiction d’exploitation commerciale? "Les compagnies sont enchantées de son retour en vol, les passagers aussi", assure John Slattery. Quant à Airbus, il prévoit d’assembler 64 A320 par mois fin 2023, soit plus qu’avant la crise. Dont une bonne part, de l’ordre de 60%, sera propulsée par des moteurs Leap.

WSJ : Israel’s Ultra-Orthodox Parties, Shorn of Influence, Vow to Unseat Prime M

Israel’s Ultra-Orthodox Parties, Shorn of Influence, Vow to Unseat Prime Minister Naftali Bennett
Some warn that Israel’s Jewish identity is under threat after broad coalition ousts community’s ally Netanyahu

TEL AVIV—For the past four decades, Israel’s ultra-Orthodox parties have spent more time in government than out. Now they join their ally Benjamin Netanyahu in opposition, and have already begun taking aim at new Prime Minister Naftali Bennett’s coalition as they try to preserve some of the hard-won privileges they enjoy in Israeli society.

Many rabbis and religious lawmakers regard Mr. Bennett’s coalition as a threat to their way of life. His government, sworn in Sunday, is a broad alliance of right-wing, leftist and centrist parties, even an independent Arab Islamist party, a first in Israeli politics. Ultra-Orthodox politicians fear it will diminish the community’s status and have vowed to disrupt and ultimately bring down the new administration, setting up what could be a prolonged skirmish over what kind of country Israel should be.

“I will use what our father Jacob used when he needed to deal with Esau: gifts, prayer and war,” said Uri Maklev, a lawmaker with the United Torah Judaism party, in a television interview with Kan News on Monday. He was referring to the battle between the grandsons of Abraham, the biblical father of the Jewish people.

Another ultra-Orthodox politician, Yaakov Litzman, recalled how he and his allies managed to oust one of Mr. Bennett’s key partners, centrist Yair Lapid, when he served as finance minister in one of Mr. Netanyahu’s governments and moved to cut funding for religious education.

“We took him to school then, I hope we’ll continue to take him to school today,” he said as he left his job as housing minister in the outgoing government.

Known in Israel as Haredim, from the Hebrew for God-fearing, the ultra-Orthodox embrace a lifestyle that adheres to the strictest standards of Jewish law. They make up around 12% of the population and live in communities that avoid the mixing of the sexes and keep modern secular life at arm’s length. Many of the community’s leaders cast themselves as Israel’s moral guardians, and earlier this month a group of leading rabbis released a letter saying that they will fight to preserve Israel’s Jewish character.

“We cannot accept a reality in which a government will be formed in Israel that will harm the most fundamental matters or religion and state,” it read.

Ultra-Orthodox parties could prove a significant irritant for Mr. Bennett, given the narrow support for his government. Just 60 members of Israel’s 120-member parliament gave him their support, with 59 voting against. One lawmaker abstained. The vote came after years of political deadlock that has seen four national elections since 2019.

Mr. Netanyahu, Israel’s longest-serving leader, frequently relied on the religious parties for support. He formed just one short-lived coalition without them and, as opposition leader, is teaming up again with ultra-Orthodox parties in an attempt to open cracks in the new government. Mr. Netanyahu convened his first meeting with them on Monday, and said they would meet at least once a week as they push ahead plans to quickly topple the new administration.

Flashpoints already are emerging.

Agreements signed between the new coalition’s members provide for more competition in regulating kosher projects and allow regional and municipal rabbinical authorities to preside over religious conversions, something currently restricted to the state religious Jewish authority controlled by the ultra-Orthodox. The issue directly affects the influence of the community, and ultra-Orthodox groups already are mobilizing support and focusing their ire squarely on Mr. Bennett, a 49-year-old former commando and tech entrepreneur who is religious and wears the kippah.

“[Bennett] sold out all of our values,” said Mr. Maklev, who previously was deputy minister of transport. “The new government will be a complete abandonment of religion.”

A widespread concern in the community is education. Ultra-Orthodox students attend separate schools where math and sciences mostly aren’t taught. For the community’s leaders, preserving the religious curriculum is pivotal to maintaining its way of life.

More secular leaders worry that having an increasingly large share of the population without any basic education preparing them for working life could pose a threat to Israel’s future economic growth.

Ultra-Orthodox parties have largely participated in Israel governments since Mr. Netanyahu’s party, the Likud, first took power in 1977, when it was headed by Menachem Begin, a militant Zionist who became Israel’s sixth prime minister. When they were on the outside, it was usually only for a year or two.

“They are very angry and they are very disappointed and you can also say they are under pressure,” said Gilad Malach, an expert on the ultra-Orthodox at the Israel Democracy Institute. He said they are worried the new government will cut funding for their communities and limit their political influence.

The past year has been difficult for ultra-Orthodox Israelis. The Covid-19 pandemic hit their towns and neighborhoods hard after they were slow or reluctant to follow social distancing guidelines that interfered with many ultra-Orthodox customs. Among more secular Israelis, Mr. Netanyahu’s popularity suffered from the perception that he was lenient on enforcing lockdowns to preserve support among the community.

Once Israel lifted its pandemic curbs, tragedy again struck the ultra-Orthodox community when dozens of people were killed in a stampede at a religious festival in Israel’s north, the first mass gathering since the start of the pandemic.

The arrival of Mr. Bennett’s government is yet another crisis to Israel’s ultra-Orthodox leaders, making them a threat to the survival of his fragile coalition in its current form and, potentially, a way back into power for Mr. Netanyahu.

In some ultra-Orthodox towns such as Bnei Brak, some residents are already predicting their leaders will soon return to power.

“Just as we survived the pharaoh in Egypt, so too will we pass this government,” said Gedaliah Ben Shimon, 42, an ultra-Orthodox lawyer.