2021/2022 Edition

November 2021

Coca-Cola's takeover of BodyArmor

The month of november started off strong: on the first of the month, the Coca-Cola group announced that they were buying the entirety of the american sports-drink group BodyArmor. Coca-Cola has taken over the entirety of the group via its biggest acquisition yet. Indeed, the group spent no less than 5.6 billion dollars to purchase BodyArmor, exceeding its acquisition of 5.1 billion dollars for Costa Coffee in 2018.

Coca-Cola was already the second biggest shareholder in 2018, as it had bought 15% of the shares. In February, the group had already signaled its desire to buy other shares of the company, in order to be the main shareholder. However, the group was better off buying the entire company.

This operation enables the group to further establish itself in the sports drink industry, but also to rival with its competitor PepsiCo, the market leader that 

owns Gatorade, which represents around 70% of the industry. Coca-Cola used theBodyArmor’s 1.4 billion dollar revenue to justify this splurge. Indeed, the company stands at second place in the sports drink industry, just before Powerade: when Coca bought the company, its sales revenue was growing at the pace of 50% each year.
The president of Coca-Cola's North American operations, Alfredo Rivera, has even stated that "BodyArmor has been a great addition to our product line over the past three years".
It should be dully noted that, with this purchase, Coca-Cola is extending its influence in the sports field, as BodyArmor sponsors major athletes such as former WTA number 1 Naomi Osaka and James Harden, to name a few.


This investment was not immediately well received by the stock market, as the group, whose market capitalization stands at more than 230 billion dollars, saw its share price fall by 0.28% on Monday, November 1st. However, it rose steadily thereafter, reaching a high of $57.16 on Thursday, November 5. Coca-Cola shares then fell sharply, and fell to lower levels at the end of November, but this does not seem to have anything to do with the BodyArmor takeover.

The rise of the metaverse : At the crossroad of tomorrow's worlds

Mark Zuckerberg's digital universe: Meta

You've probably heard all about it recently: the CEO of Facebook, Mark Zuckerberg, announced a little over a month ago that the social networking giant was changing its name to Meta.

The multi-headed hydra made up of Facebook, Whatsapp, Instagram (etc); Meta (Meta Platforms) thus asserts its desire to become the undisputed leader of the metaverse.

It did not take long for the group to declare the upcoming hiring of 10,000 employees specifically recruited to work on the metaverse.

A real buzzword (whose use was probably pushed by Meta); the metaverse has been making headlines around the world for a few weeks now.

The metaverse is "the pinnacle of all science fiction fantasies", as described by a 'crypto-sous.fr' editor in movies like Tron and more recently Ready Player One. In fact, a metaverse is an immersive virtual universe in which users can interact and navigate (and not only) freely and in an interconnected way.

 

Moreover, it is true that in view of the dystopian trends highlighted in films and series such as Ready Player One and Black Mirror, we could be tempted to convince ourselves that this is pure science fiction. However, the facts are clear: Shopify, Microsoft, Nvidia, among other big names in the industry, are all preparing for it.

 

Nike's stance

A recent demonstration of the phenomenon might be the example of Nike. The sportswear giant has taken its first “meta-steps” in the metaverse. The Oregon-based company registered several patent applications with the US Patent & Trademark Office (USPTO) a few weeks ago, which could announce the beginning of a deployment of virtual products in the metaverse. A noteworthy fact might be that, like Meta, Nike plans to recruit various profiles for the design of its future virtual goods.

We are probably not that far from witnessing the rise of these new products, objects proper to the development of a digital and virtual environment, sold on a specific market that promises, logically, to include other products that are part of our everyday consumption.

Furthermore, the group showed its intentions in November, with its first metaverse project called "Nikeland" in partnership with Roblox, the massively popular multiplayer online game (MMO) platform.

 

The launch of Nikeland, a virtual world with many mini-games, gives Nike the opportunity to host its own metaverse experience and invites Roblox players to join the universe for free.

The Roblox engine uses the smartphone's augmented reality (AR) to interpret the user's movements, such as jumping or running, during the online game. From this, Nike lets developers use their toolkit to create mini-games, allowing users to enjoy a range of independently produced games.

 

Moreover, in the line of “housing” (which means owning a house in a virtual environment), particularly popular among video game enthusiasts (Minecraft, etc), some brands are already trying to capitalize on the metaverse ...in the form of NFTs.

Popularized only a little while ago, the "non-fungible tokens" (NFTs) are unfalsifiable digital property certificates based on the blockchain. They are making many types of noise; "the biggest unlocking of property that art has known in its history," says, for example, Sarah Sherrill about NFTs, co-founder of Lobus, an art management platform.

NFTs play a role in mediating interactions and proving private property in the metaverse world.

Crypto-currencies and a boatload of NFTs

When Mark Zuckerberg announced that Facebook was changing its name to Meta, crypto-currencies’ popularity took a giant leap forward.

In the metaverse, NFTs will give people ownership over their characters, in-game purchases, and will even enable the registration of virtual land in their name. Crypto-currencies will become the legal currency in the virtual economy and all intangible objects will be NFTs.

 

Recently, the market for NFTs has evolved;

- SuperRare, the largest NFT marketplace applied to the art world (focused on single edition digital artworks), has seen an explosion in sales volumes in recent months ($31 million (in October)).

- In addition, Tyler Hobbs, the creator of the Fidenza series of NFTs, sold $7 million worth of NFTs in his "Incomplete Control" collection.

 

Equally if not more unpredictable, the market for sports industry-focused NFTs is resonating.

- Take Dapper Labs, the NFTs company behind NBA Top Shots (a digital basketball card market comparable to the virtual soccer card market in which the flamboyant French company Sorare is involved): it announced a $250 million funding round a little over a month ago. Bringing investors such as GV (Google Ventures) and Version One Ventures to the table, "Dapper Labs [is gaining rare confidence thanks to] its flagship titles, including NBA Shots, which is one of the fastest growing markets in the world," says the website 'prnewswire'.

 

Finally, like Sorare which recently raised $680 million, Dapper Labs has signed a contract with LaLiga for a soccer project in the summer of 2022; a relationship to be followed between the two giants of virtual card issuing!

Round-up made on the considerable presence of NFTs in the global digital economy, we should better understand their importance in the future markets that the metaverse will offer.

AI, AR and VR to take us there

In the metaverse, people appear by scanning themselves in 3D or by creating their avatar. Characters in the metaverse are recognized as individuals, clones of their creator in real life, and not just as game characters.

In addition to their own avatar, the actors of this new world create objects that can express their uniqueness.

Immersion in VR (virtual reality) would induce the human brain to release the same chemicals (endorphins, serotonin, dopamine) in the same way as in the real world, which would make virtual life in the metaverse more natural and more realistic than the Internet.

 

The metaverse means entering the internet instead of just looking at it!

 

Augmented reality (AR), which can be accessed using a smartphone or computer, involves overlaying visuals, sounds, and other sensory stimuli onto a real-world environment to enhance the user's experience.

Also, the metaverse will be enabled, populated and supported by artificial intelligence (AI). The latter will aim to reduce the time to create realistic characters to a few minutes. Beyond the shape of the character, AI will bring it to life through realistic movement and acting.

 

The access points will use augmented reality (AR) and virtual reality (VR) technologies (e.g. VR headsets like the Oculus/Meta Quest 2 released last year).

AI, AR and VR are thus gateways to the metaverse.

 

Existing in the metaverse is equivalent to living inside the internet. This opens the possibility of creating a new world, a new economy and an entire universe of new possibilities.

Although it will still be a decade or two away, in the metaverse we will eat, buy and work, and a new class of economy will emerge, which has already taken shape in the form of crypto-currencies and NFTs.

A recent market analysis estimated that the metaverse market could be worth around $800 billion by 2024. This can be considered a meteoric rise for metaverses.

Thus, given the estimated size of the market, there is no doubt that it will be the domain of the technology giants in the years to come.

Solidarity finance, or how to "give meaning to your savings" ?

Focus on the Solidarity Finance Week from November 8th to 15th, 2021

                "Solidarity savings, a good idea that is spreading", we remember from the campaign video of the 14th national edition of the Solidarity Finance Week. Like every year during one week in November, the association and collective FAIR organizes the Solidarity Finance Week to raise awareness and attract savers to investments "that give meaning to savings". Numerous events took place throughout France and the 2021 Grands Prix de la Finance Solidaire were awarded; lets zoom in on the event after a few reminders of the main notions.

 

Solidarity finance...

 

            What is it? Solidarity finance is a component of impact finance which concerns funds invested in the SSE (Social and Solidarity Economy) aiming to finance projects of "social and environmental utility" such as reintegration through employment, the green economy, rehousing, sustainable energies, etc.

 

                What are its origins? It started off in the early 1980s, during a movement of liberalization of the financial sector linked to the rapid increase of unemployment. Thus, solidarity finance appeared in France. From there, some savers felt determined to act with their savings to support organizations with a social vocation (help with integration, rehousing, support for developing countries, access to social credit, etc.). The philosophy behind this mobilization tends to think that there is a more human approach to finance. The Social and Solidarity Economy has since benefited from regulatory contributions, which are now used for the proper deployment of solidarity finance.

 

           How does it work and what are its guarantees? Solidarity finance brings together savers who wish to invest their money in causes in line with their values, and organizations (generally companies and associations) whose activity has a strong social and/or environmental utility. This will be financed by the contributions of these subscribers of solidarity savings products, detailed below. Since 2001, the State has set up a "solidarity company" approval to supervise these companies which place these issues at the heart of their strategy, more than their financial profitability.

            The Finansol label alone constitutes the perimeter of solidarity finance in France. Awarded by a committee of independent experts, it is the only private financial label in France that guarantees the qualification of solidarity projects through its two fundamental criteria: solidarity and transparency. Conferred for 24 years, it has been awarded to 14 companies and (withdrawn from 7 of them) to count 166 financial products labeled by 31/12/2020 in France. In light of the multiplication of misleading phenomena such as "green washing" or "solidarity washing", its legitimacy is relevant. Since solidarity finance raises the question of "change" and brings an idea of "transition" to the financial markets, the expectations and behaviors of savers are to be studied more closely than ever.

 

Towards solidarity investment...

 

                 "Useful, profitable, open to all". According to the FAIR association, there are more than one million solidarity savers in France today. Beyond the appreciation of risk, liquidity and expectations in terms of performance of the saver, there is the question of the meaning that one wishes to give to his investment. Solidarity savings are indeed a solution to our current social challenges. In addition to aligning the causes you defend with your status as a saver, you can benefit from tax reductions.

 

                  Solidarity investment solutions. At the end of 2020, solidarity financing reached 2.68 billion euros, an increase of 27%. The diagram below (2020 figures) presents the main solutions available to us to become a solidarity saver:

[August 2021, Inspiration for figures presented in the Fair report "Zoom 2021 on solidarity finance"]

  • Solidarity-based employee savings (11,700 million euros) is offered by employees' companies (e.g. solidarity-based company mutual funds).

 

  • Solidarity bank savings (7,857 million euros) refers to savings products offered by banks or mutual insurance companies (e.g.: passbook savings, life insurance, UCIs [Undertakings for Collective Investments], term deposits).

 

  • The savings collected by solidarity enterprises (790 million euros) concern the investments proposed by solidarity enterprises and financiers, subscription of capital shares (= unlisted shares and investments).

 

            Thus, by the end of 2020, 4.4 million solidarity savings products had been subscribed, for a total of 20.35 billion euros (+33%).

 

 

           

Allocation of solidarity investments. In 2020, the allocation of solidarity investments was as follows :

 

  • Financing of associations and companies with strong social use in France: 49.1%

  • Investment in social real estate companies: 31.7%

  • Financing of activities with high social utility in developing countries: 4.1%

  • Social loans: 9.6%

  • Environmental loans: 5.5%

...To "give meaning to your savings": FAIR association and the Solidarity Finance Week

 

            The FAIR association (from its name: Financer, Accompagner, Impacter, Rassembler), presents itself as the reference organization for social impact finance. Created in 2021 from the merger of the Finansol label (still in force) and IiLab (Impact Invest Lab), it brings together more than 110 "solidarity finance pioneers" (banks, management companies, NGOs, Grandes Ecoles, personalities) around solidarity finance. It is also supported by the Ministry of Economy, Finance and Recovery and the Ministry of Europe and Foreign Affairs. FAIR is also a collective, at the origin of the national event "Solidarity Finance Week" which seeks to mobilize, exchange and debate around its key topic.

 

           Program of the Solidarity Finance Week. From November 8th to 15th, 2021, the 14th essential meeting of solidarity finance took place in person (in several cities in France) and remotely, for webinars. During these 8 days, several conferences, workshops and meetings between individuals and professionals were organized to ask questions about savings and share testimonies.

 

Some examples of activities, some of which can be found online:

  • Travelling exhibition "L'argent de tous les possibles”

  • 2nd conference on renewable and citizen energies

  • Webinars on the following topics: the dynamics of solidarity finance, the challenges of climate change in Africa, cooperative unicorns, savings solutions, etc...

  • Emmaus’ Livestream on solidarity savings

  • And others: Market of the solidarity world, aperitifs, round table and debates between entrepreneurs

 

             Awarding of the 2021 Grands Prix de la Finance Solidaire. On Tuesday, November 9th, 2021, in Lyon, the FAIR association highlighted and rewarded the committed actors of solidarity finance with its partner Le Monde. Other renowned players also supported the event: Caisse d'Épargne, MAIF, City of Lyon, mirova, AFD, Banque des Territoires and France Active. There were many applications; each winner was promised €4,000 as well as high visibility from the newspaper Le Monde: a special report in Le Monde Argent and on Le Monde, and a spotlight on the FAIR website.

            The results of this 14th edition were announced according to the following categories, grouped in the table below:

 

 

See you in November 2022 to discover the next themes on solidarity finance and the next new winners!