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A Nobel for Gadgets! Lithium-Ion Batteries Win the Prize

While the Nobel prizes can sometimes dive into foundational but seemingly rarified corners of the sciences, Wednesday morning’s announcement of the prize for chemistry reached into billions of people’s pockets—and homes, offices, workshops, cars … pretty much the entire infrastructure of modern life. For their invention of the rechargeable lithium-ion battery, key to everything from…

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A Nobel for Gadgets! Lithium-Ion Batteries Win the Prize

While the Nobel prizes can sometimes dive into foundational but seemingly rarified corners of the sciences, Wednesday morning’s announcement of the prize for chemistry reached into billions of people’s pockets—and homes, offices, workshops, cars … pretty much the entire infrastructure of modern life. For their invention of the rechargeable lithium-ion battery, key to everything from mobile phones to electric cars, John B. Goodenough of UT Austin, M. Stanley Wittingham of SUNY Binghamton, and Akira Yoshino of Miejo University will take home medals and a share of $906,000.

“Amazing. Surprising,” Yoshino said by phone at the press conference announcing the prize. Which, sure, maybe, though a September panel sponsored by the American Chemical Society predicted a win for Goodenough and lithium-ion rechargeables; he and the tech have been a longtime favorite. (The genome-editing technology Crispr was a dark horse.)

Members of the Royal Swedish Academy of Sciences announce the winners of the 2019 Nobel Prize in Chemistry.

Photograph: NAINA HELEN JAMA/Getty Images

“I don’t know if they had been waiting for the news for years, but they were very happy,” said Göran Hansson, a physician and member of the Nobel Committee, of Wittingham and Yoshino. The committee hadn’t yet reached Goodenough, Hansson said, who at 97 years old becomes the oldest living Nobel laureate.

Lithium-ion batteries have become a staple in modern electronics. Introduced commercially in 1991, their light weight and high energy efficiency let electronics manufacturers stuff them into mobile phones, portable computers, and cameras. But since the batteries are also stackable into large arrays and can undergo hundreds of discharge–charge cycles, they’re also at the heart of electric bikes and cars like Priuses and Teslas, and they have become dependable parts of sustainable, green energy. Sources of energy like wind or solar don’t emit planet-killing greenhouse gases, but they’re less dependable than fuels derived from oil. Lithium-ion batteries can charge when the wind turns turbines and the sun drops photons on photoelectric cells, and then discharge when they don’t—maintaining even distribution on the electrical grid. One estimate puts the size of the world market at $36 billion, with the possibility of hitting almost $110 billion by 2026.

All batteries work roughly the same way. Electrons flow from a negative electrode called an anode through a material, often a liquid, called an electrolyte, to a positive electrode, the cathode. Pump that flow through a circuit and it’ll power a device. In the mid-1970s, Wittingham—then working for Exxon—figured out how to use the ultralight, highly reactive metal lithium in the anode. That was great; not only does lithium readily give up electrons, but applying charge to the new battery would restore them. Unfortunately, that version of the battery also tended to blow up.

In 1980 Goodenough and his team, working at Oxford, figured out that a cobalt oxide cathode would make for a more stable battery; later that decade Yoshino’s group learned to use more complicated carbon-based materials in electrodes that’d still let lithium ions nestle inside and flow through the battery. Yoshino also developed a way to test the batteries to show that, unlike earlier versions, they wouldn’t catch fire—at least not as easily as the early versions. His high-tech approach: Drop something heavy on it.

As common as they are, Li-ion batteries still have their problems. They’re tough, sure, but problems with the software that controls them or damage to their outer case can still let lithium ignite; that same electrochemical tendency to give up its electrons makes it highly reactive with oxygen, which is just fancy talk for “burns real good.” That’s why you’re not allowed to stow them in airplane luggage anymore.

Also, the world would love a better battery, even lighter, even smaller, with even more powerful battery materials, that charges faster—maybe replace the graphite with silicon, or sub out the liquid electrolyte for a polymer. It’d be nice to not have to rely on lithium at all, since mining the stuff is about as environmentally friendly as any other extractive industry, which is to say, not so much.

Still, since you’re probably reading this on a gadget with a Li-ion battery making it go, the win makes sense. Li-ion batteries continue to improve as researchers hunt for alternatives, but the future-y world of wireless earbuds, mobile phones, and laptops wouldn’t exist without lithium-ion. And as governments and industries look for ways to harness power that don’t exacerbate an ongoing climate crisis, battery tech will be key. “I think we are only at the beginning of that development when it comes to environmental effects, for example transportation and powering the grid,” said Olof Ramström, a Nobel Committee member, after the announcement. “Not just lithium-ion, but also other types of batteries that may be discovered in the future.” Sometimes knowledge really is power.


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These ten enterprise M&A deals totaled over $40B in 2019

It would be hard to top the 2018 enterprise M&A total of a whopping $87 billion, and predictably this year didn’t come close. In fact, the top 10 enterprise M&A deals in 2019 were less than half last year’s, totaling $40.6 billion. This year’s biggest purchase was Salesforce buying Tableau for $15.7 billion, which would…

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These ten enterprise M&A deals totaled over $40B in 2019

It would be hard to top the 2018 enterprise M&A total of a whopping $87 billion, and predictably this year didn’t come close. In fact, the top 10 enterprise M&A deals in 2019 were less than half last year’s, totaling $40.6 billion.

This year’s biggest purchase was Salesforce buying Tableau for $15.7 billion, which would have been good for third place last year behind IBM’s mega deal plucking Red Hat for $34 billion and Broadcom grabbing CA Technologies for $18.8 billion.

Contributing to this year’s quieter activity was the fact that several typically acquisitive companies — Adobe, Oracle and IBM — stayed mostly on the sidelines after big investments last year. It’s not unusual for companies to take a go-slow approach after a big expenditure year. Adobe and Oracle bought just two companies each with neither revealing the prices. IBM didn’t buy any.

Microsoft didn’t show up on this year’s list either, but still managed to pick up eight new companies. It was just that none was large enough to make the list (or even for them to publicly reveal the prices). When a publicly traded company doesn’t reveal the price, it usually means that it didn’t reach the threshold of being material to the company’s results.

As always, just because you buy it doesn’t mean it’s always going to integrate smoothly or well, and we won’t know about the success or failure of these transactions for some years to come. For now, we can only look at the deals themselves.

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Jumia, DHL, and Alibaba will face off in African ecommerce 2.0

The business of selling consumer goods and services online is a relatively young endeavor across Africa, but ecommerce is set to boom. Over the last eight years, the sector has seen its first phase of big VC fundings, startup duels and attrition. To date, scaling e-commerce in Africa has straddled the line of challenge and…

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Jumia, DHL, and Alibaba will face off in African ecommerce 2.0

The business of selling consumer goods and services online is a relatively young endeavor across Africa, but ecommerce is set to boom.

Over the last eight years, the sector has seen its first phase of big VC fundings, startup duels and attrition.

To date, scaling e-commerce in Africa has straddled the line of challenge and opportunity, perhaps more than any other market in the world. Across major African economies, many of the requisites for online retail — internet access, digital payment adoption, and 3PL delivery options — have been severely lacking.

Still, startups jumped into this market for the chance to digitize a share of Africa’s fast growing consumer spending, expected to top $2 billion by 2025.

African e-commerce 2.0 will include some old and new players, play out across more countries, place more priority on internet services, and see the entry of China.

But before highlighting several things to look out for in the future of digital-retail on the continent, a look back is beneficial.

Jumia vs. Konga

The early years for development of African online shopping largely played out in Nigeria (and to some extent South Africa). Anyone who visited Nigeria from 2012 to 2016 likely saw evidence of one of the continent’s early e-commerce showdowns. Nigeria had its own Coke vs. Pepsi-like duel — a race between ventures Konga and Jumia to out-advertise and out-discount each other in a quest to scale online shopping in Africa’s largest economy and most populous nation.

Traveling in Lagos traffic, large billboards for each startup faced off across the skyline, as their delivery motorcycles buzzed between stopped cars.

Covering each company early on, it appeared a battle of VC attrition. The challenge: who could continue to raise enough capital to absorb the losses of simultaneously capturing and creating an e-commerce market in notoriously difficult conditions.

In addition to the aforementioned challenges, Nigeria also had (and continues to have) shoddy electricity.

Both Konga — founded by Nigerian Sim Shagaya — and Jumia — originally founded by two Nigerians and two Frenchman — were forced to burn capital building fulfillment operations most e-commerce startups source to third parties.

That included their own delivery and payment services (KongaPay and JumiaPay). In addition to sales of goods from mobile-phones to diapers, both startups also began experimenting with verticals for internet based services, such as food-delivery and classifieds.

While Jumia and Konga were competing in Nigeria, there was another VC driven race for e-commerce playing out in South Africa — the continent’s second largest and most advanced economy.

E-tailers Takealot and Kalahari had been jockeying for market share since 2011 after raising capital in the hundreds of millions of dollars from investors Naspers and U.S. fund Tiger Global Management.

So how did things turn out in West and Southern Africa? In 2014, the lead investor of a flailing Kalahari — Naspers — facilitated a merger with Takealot (that was more of an acquisition). They nixed the Kalahari brand in 2016 and bought out Takelot’s largest investor, Tiger Global, in 2018. Takealot is now South Africa’s leading e-commerce site by market share, but only operates in one country.

In Nigeria, by 2016 Jumia had outpaced its rival Konga in Alexa ratings (6 vs 14), while out-raising Konga (with backing of Goldman Sachs) to become Africa’s first VC backed, startup unicorn. By early 2018, Konga was purchased in a distressed acquisition and faded away as a competitor to Jumia.

Jumia went on to expand online goods and services verticals into 14 Africa countries (though it recently exited a few) and in April 2019 raised over $200 million in an NYSE IPO — the first on a major exchange for a VC-backed startup operating in Africa.

Jumia’s had bumpy road since going public — losing significant share-value after a short-sell attack earlier in 2019 — but the continent’s leading e-commerce company still has heap of capital and generates $100 million in revenues (even with losses).

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Airbnb’s New Year’s Eve guest volume shows its falling growth rate

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between. It’s finally 2020, the year that should bring us a direct listing from home-sharing giant Airbnb, a technology company valued at tens of billions of dollars. The company’s flotation will be a key event in…

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Airbnb’s New Year’s Eve guest volume shows its falling growth rate

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

It’s finally 2020, the year that should bring us a direct listing from home-sharing giant Airbnb, a technology company valued at tens of billions of dollars. The company’s flotation will be a key event in this coming year’s technology exit market. Expect the NYSE and Nasdaq to compete for the listing, bankers to queue to take part, and endless media coverage.

Given that that’s ahead, we’re going to take periodic looks at Airbnb as we tick closer to its eventual public market debut. And that means that this morning we’re looking back through time to see how fast the company has grown by using a quirky data point.

Airbnb releases a regular tally of its expected “guest stays” for New Year’s Eve each year, including 2019. We can therefore look back in time, tracking how quickly (or not) Airbnb’s New Year Eve guest tally has risen. This exercise will provide a loose, but fun proxy for the company’s growth as a whole.

The numbers

Before we look into the figures themselves, keep in mind that we are looking at a guest figure which is at best a proxy for revenue. We don’t know the revenue mix of the guest stays, for example, meaning that Airbnb could have seen a 10% drop in per-guest revenue this New Year’s Eve — even with more guest stays — and we’d have no idea.

So, the cliche about grains of salt and taking, please.

But as more guests tends to mean more rentals which points towards more revenue, the New Year’s Eve figures are useful as we work to understand how quickly Airbnb is growing now compared to how fast it grew in the past. The faster the company is expanding today, the more it’s worth. And given recent news that the company has ditched profitability in favor of boosting its sales and marketing spend (leading to sharp, regular deficits in its quarterly results), how fast Airbnb can grow through higher spend is a key question for the highly-backed, San Francisco-based private company.

Here’s the tally of guest stays in Airbnb’s during New Years Eve (data via CNBC, Jon Erlichman, Airbnb), and their resulting year-over-year growth rates:

  • 2009: 1,400
  • 2010: 6,000 (+329%)
  • 2011: 3,1000 (+417%)
  • 2012: 108,000 (248%)
  • 2013: 250,000 (+131%)
  • 2014: 540,000 (+116%)
  • 2015: 1,100,000 (+104%)
  • 2016: 2,000,000 (+82%)
  • 2017: 3,000,000 (+50%)
  • 2018: 3,700,000 (+23%)
  • 2019: 4,500,000 (+22%)

In chart form, that looks like this:

Let’s talk about a few things that stand out. First is that the company’s growth rate managed to stay over 100% for as long as it did. In case you’re a SaaS fan, what Airbnb pulled off in its early years (again, using this fun proxy for revenue growth) was far better than a triple-triple-double-double-double.

Next, the company’s growth rate in percentage terms has slowed dramatically, including in 2019. At the same time the firm managed to re-accelerate its gross guest growth in 2019. In numerical terms, Airbnb added 1,000,000 New Year’s Eve guest stays in 2017, 700,000 in 2018, and 800,000 in 2019. So 2019’s gross adds was not a record, but it was a better result than its year-ago tally.

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