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Amex’s Business Platinum is one of the best cards for small business owners — the welcome bonus alone is worth up to $2,000 in free travel

Tue, 09/10/2019 - 2:42pm  |  Clusterstock

  • There are a lot of business cards out there, but if you want a premium card with premium rewards and benefits, you can't go wrong with the Business Platinum® Card from American Express.
  • The card has been in my own wallet since December 2016, and I love the combination of benefits — from a large welcome bonus to a $200-per-year travel credit and access to more than 1,200 lounges in 130 countries.
  • If you're a regular jetsetter for work or pleasure, you will likely find the $595 annual fee well worth it.
  • The card's currently offering an elevated welcome bonus, so now is an especially good time to consider if it deserves a place in your wallet.

Small business owners have many options when choosing a card. When it comes to getting the biggest rewards and benefits, the American Express Business Platinum Card stands out from the rest. While the card carries a higher-than-average annual fee, frequent travelers get a ton of value back in benefits.

From up to a 100,000-point welcome bonus to up to $200 of airline fee credits each year and access to the American Express Global Lounge Collection, it's easy to earn back the annual fee and more in value from the Amex Business Platinum. Let's dive in and look at the details to help you decide if it makes sense for your small business needs.

Amex Business Platinum welcome bonus and points earning

The Amex Business Platinum card offers rewards in the form of Amex Membership Rewards points. These points are worth around 1.5 to 2 cents each when redeemed for travel. On the high end, that means the welcome bonus of up to 100,000 points is worth $2,000 in free or discounted travel!

To qualify for the full welcome bonus, you'll have to do quite a bit of spending. Earn 50,000 points after spending $10,000 in the first three months after opening a new account. You'll earn 50,000 more points after spending an additional $15,000 on purchases in the same period. That means you'll have to spend $25,000 on purchases in the first three months to get the full bonus.

This elevated welcome offer is only available until December 4, 2019, so don't wait.

Outside of the bonus, the card offers 5 points per dollar spent on flights and prepaid hotels at AmexTravel.com, 1.5 points per dollar on purchases of $5,000 or more (up to 1 million additional points per year), and 1 point per dollar on all other purchases. Depending on your business needs, you could earn a ton of points through regular spending.

Using the Amex Business Platinum's points

Using Amex Membership Rewards is easy, but it might take a little research to get the best value per point. The best value typically comes from transferring points to airline partners at a 1:1 ratio. Not all airlines offer that rate, so be careful when linking accounts and transferring points.

The easiest way to use points is to book travel directly through the Membership Rewards portal. You can search and book with a familiar-feeling system that works like many popular travel search websites. You usually get 1 cent per point for airfare and a little less value for hotels, rental cars, cruises, or vacation packages.

As a Business Platinum holder, though, you get an additional perk when booking through Amex Travel. If you use points to pay for eligible airfare, you get 35% of your points back as a bonus up to 500,000 points per year. That bonus can add up fast if you travel regularly for business.

You can also use points to pay your bill, shop at Amazon, pay for Uber rides, shop in an online mall, or buy gift cards. In general, you get less value per point with these redemption options.

Read more: 5 ways Amex cardholders can redeem their points — plus the method that gets you maximum value

American Express Business Platinum benefits

A large bonus was enough to entice me to sign up for this card for my own business a couple of years ago, but it was the lounge benefit that got me most excited to carry the card in my wallet.

This card comes packed with valuable benefits tailored to premium business travel. These benefits can be worth hundreds or thousands of dollars on top of the value you can get from your Membership Rewards points.

Here's a list of what you get with an Amex Business Platinum card. Note that many of these perks are identical to what you get with the Platinum Card® from American Express (the non-business version).

  • $200 travel credit — Get $200 back in fees from the major US airline of your choice. While it doesn't count toward airfare, you'll be reimbursed for things like luggage fees, upgrade charges, and in-flight purchases up to $200 per year. That is a big offset to the annual fee when it's used to its full potential.
  • Lounge collection — Get access to American Express Centurion lounges, a complimentary Priority Pass membership, and access to Delta Sky Clubs when flying Delta. Centurion and Priority Pass visits work when you're flying with any airline. Combined, that gives you access to more than 1,200 lounges in 130 countries.
  • Global Entry or TSA PreCheck credit — Every four years get your Global Entry ($100) or TSA PreCheck ($85) fee covered by your AmEx card. That's worth $20 per year with Global Entry; you have to renew every five years to keep your membership active.
  • No foreign transaction fees — You won't pay a 3% additional charge when you use the card outside of the United States.
  • Hotel status — Get instant Hilton Honors Gold and Marriott Gold elite status without meeting minimum stay or purchase requirements.
  • Fine Hotels & Resorts — Get free benefits including free Wi-Fi, room upgrades, free breakfast for two, late checkout, and a hotel amenity valued at $100 each stay when you book through Fine Hotels & Resorts. As Business Insider's David Slotnick experienced, these perks can elevate a luxury hotel stay.
  • Complimentary Boingo Wi-Fi — Tap into free internet access at more than 1 million Boingo hotspots at airports and other locations around the world with the American Express Preferred Plan, included for Platinum cardholders.

The card also offers the following business-oriented benefits, which aren't available on the personal Amex Platinum:

  • One year of Platinum Global Access from WeWork — When you enroll by December 31, 2019. This lets you use coworking spaces around the world.
  • Up to $200 in annual Dell statement credits — Get reimbursed for purchases at Dell. This is divided into two $100 credits: up to $100 in Dell statement credits between January and June, and up to $100 between July and December.

Benefits don't stop there, but those are the most valuable and popular. Cardholders also get access to a concierge service for travel planning services and exclusive entertainment and events. Few cards come close to what the Business Platinum card offers in terms of benefits.

Read more: I use Amex Offers to find exclusive discounts at stores and restaurants like Amazon and Starbucks — here's how the credit card benefit works

American Express Business Platinum costs and fees

Now that you know how much you'll get in benefits from the Amex Business Platinum, it's important to understand what it will cost you. Out of the gate, this card charges a $595 annual fee. 

That may give you sticker shock, but when you add up the value of Membership Rewards points, the $200 annual airline fee credit, a credit for Global Entry, and all of the free drinks and food you get when visiting airport lounges, it is easy to see how you can recoup most, if not all, of the annual fee each year.

This card is a charge card, not a credit card, so you pay your balance in full each month and don't pay any interest. If you prefer to carry a balance, you can enroll in the optional Pay Over Time feature for an additional cost. Pay Over Time currently charges 20.49% APR, a rate that can change any time. If you miss a payment or pay late, you'll pay a higher 29.99% variable rate penalty APR.

Late payments cost the higher of $39 or 2.99% of the past due amount. Returned payments cost $38 per occurrence.

There's no foreign exchange fee and this card does not offer balance transfers or cash advances, so you don't have to pay for those either.

Does the Amex Business Platinum card make sense for you?

There are a lot of business credit cards out there, but if you want a premium card with premium rewards and benefits, you can't go wrong with the American Express Business Platinum. The card has been in my own wallet since December 2016, and I love the combination of benefits. There's little that makes a hectic travel day easier than dropping into a Centurion Lounge for a drink and a bite.

If you don't travel regularly, you may not value the benefits this card provides. But if you're a regular jet-setter for work or pleasure, you'll likely find the $595 annual fee well worth it. When you used the card's benefits to the max, you may get thousands of dollars in value from this card each year. 

Click here to learn more about the Amex Business Platinum from our partner The Points Guy.

SEE ALSO: 5 exclusive travel benefits and events you can only access as an Amex Platinum cardholder

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CITI: Gold could shatter $2,000, reach all-time high if recession risks continue

Tue, 09/10/2019 - 2:27pm  |  Clusterstock

  • Gold could hit historic highs and even break $2,000 per ounce in the next couple years if recession risks and rate cuts continue, analysts at Citi said in a Tuesday note.
  • The precious metal is up about 17% year-to-date as trade war tensions and downturn fears drive investors toward the "safe haven" asset.
  • The analysts' positive outlook sees risks from the possibility of a surprise trade deal between the US and China, and from possible hawkish decisions from the Federal Reserve.
  • Watch gold trade live here.

Gold could hit $2,000 per ounce in the next year or two if lower interest rates and recession fears stick around, Citi analysts said in a Tuesday note.

The analysts' "medium term" target represents a new historic high for gold, which last peaked in August 2011 when it reached $1,830.55 per ounce.

The coveted metal surged through 2019, and is up about 17% year-to-date. Geopolitical tensions, lower global interest rates and looming recession risks fueled the run-up, Citi analysts said. Though the bank expects "profit taking" in the short term, it sees gold trading "stronger for longer" in the next three years.

"We find it reasonable to consider an increasing probability that bullion markets can re-test the 2011 to 2013 nominal price peaks and trade to $1,800-2,000 per ounce by 2021 and 2022 on the back of a US business cycle turn towards slower growth/recession on top of election uncertainty," the team led by Aakash Doshi wrote.

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The note upgrades the bank's fourth-quarter target price for gold to $1,575 per ounce, and its 2020 price target to $1,675. Gold traded at $1,491.53 as of 1:35 p.m. ET Tuesday.

Citi's rosy outlook for gold does see "clear risks" from a hawkish pivot by the Federal Reserve and upgrades in global growth expectations, the analysts noted. A surprise deal ending the trade war would suggest a price peak at $1,550 per ounce, they added.

The precious metal is a popular "safe haven" investment during times of economic volatility, as its physical scarcity and steady demand appeals to those looking to escape tanking markets.

The People's Bank of China has been stockpiling gold in its reserves for eight months in a row, signalling the nation expects continued market volatility and a prolonged trade war with the US.

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A majority of Americans think a recession will strike in the next year — and they're blaming Trump's trade war

Tue, 09/10/2019 - 2:12pm  |  Clusterstock

  • Americans have grown increasingly concerned that the trade war with China will raise prices and tip the economy into a recession.
  • Six in 10 Americans in an ABC News/Washington Post poll released Tuesday said they think a recession is likely in the next year. About 43% said they think trade policies have increased the chances.
  • That undermines a core source of support for President Donald Trump as he campaigns for reelection.
  • Visit the Markets Insider homepage for more stories.

Americans have grown increasingly concerned that the trade war with China will tip the economy into a recession within the next year, undermining a core source of support for President Donald Trump as he campaigns for reelection.

Six in 10 Americans in an ABC News/Washington Post poll released Tuesday said they think a recession is likely in the next year. The same amount said they were concerned that US tariffs on thousands of Chinese products over the past year would raise prices at home. About 43% said they think trade policies have increased the chance of a recession.

The tit-for-tat tariff disputes the Trump administration ignited with China and other trading partners last year have cast a thick cloud of uncertainty over the economy, which had already been expected to cool in the coming months. 

That has chipped away at one of Trump's strongest campaign issues: the economy. The poll found that the president's approval rating among voting-age Americans stood at 38%, down 6 points from July and slightly below his career average. About 56% said they disapproved of Trump's performance in office.

"The main thing driving this concern among Americans is just looking out their windows," said Austan Goolsbee, who served as a chairman of the Council of Economic Advisers in the Obama administration. "They are paying for tariffs, and the economy is slowing down."

The US and China have escalated tariffs several times in recent months, with far more consumer products targeted than in previous tranches. Trump has vowed to expand duties in December to virtually all Chinese imports, including electronics and other sensitive goods.

"For many Americans, President Trump's trade war is only now starting to directly hit home," said Chad Bown, a senior fellow at the nonpartisan Peterson Institute for International Economics. "The worst price hikes are likely still to come for the American consumer."

Trump disputed the poll's results without evidence on Tuesday morning.

"ABC/Washington Post Poll was the worst and most inaccurate poll of any taken prior to the 2016 Election," the president wrote on Twitter. "When my lawyers protested, they took a 12 point down and brought it to almost even by Election Day. It was a Fake Poll by two very bad and dangerous media outlets. Sad!"

Read more: Investors have triggered a recession signal with a perfect 50-year track record — and one expert says years of 0% market returns could be in store

SEE ALSO: The White House says the trade war isn't hurting the US. The most recent data suggests otherwise.

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The Future of Payments 2018

Sun, 09/08/2019 - 9:02pm  |  Clusterstock

The payments industry is transforming.

Noncash payments methods are quickly becoming the norm.

Business Insider Intelligence projects digital payments to continue to grow through 2023 and beyond.

This shift has created a battle between incumbents and startups vying to become the leaders of the future of payments.

While incumbents have massive scale to lean on, startups typically offer a much friendlier user experience. Whoever can master both first will win the battle.

That will require navigating four key digital transformations: diversification, consolidation and collaboration, data protection and automation.

In this FREE section of The Future of Payments 2018 slide deck from Business Insider Intelligence, we look at the first key digital transformation: diversification.

Subscribe to Business Insider Intelligence today for full access to the complete deck.

As an added bonus to this FREE section, you will gain immediate access to our exclusive BI Intelligence Daily newsletter.

To get your copy of this free slide deck, click here.

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Goldman Sachs analyzed 4,481 IPOs over 25 years and concluded that these 5 attributes can make or break a newly public company

Sun, 09/08/2019 - 7:45pm  |  Clusterstock

  • The public markets have seen a long-awaited influx of initial public offerings this year. 
  • While many IPOs are outperforming the market, some of the most high-profile new listings such as Uber and Lyft have struggled.
  • Goldman Sachs analyzed 4,481 IPOs over 25 years and determined the five attributes that are a key to a successful IPO. 
  • Visit the Markets Insider homepage for more stories. 

2019 has been a monster year for initial public offerings. 

Darlings of Silicon Valley such as Uber, Lyft, and Pinterest have entered the public markets after years of raising private capital. 

The broader IPO market is also outperforming most of the major stock indexes. The Renaissance IPO ETF, which tracks the performance of new listings, has climbed more than 33% since the beginning of the year. Comparatively, the S&P 500 has risen about 19%. 

Markets Insider is looking for a panel of millennial investors. If you're active in the markets, CLICK HERE to sign up.

But some of the most closely followed public offerings are struggling. Uber and Lyft have both dipped below their offering prices. Investors have begun to question the rising costs of  their business models, and whether or not they can ever achieve sustainable profitability. 

The same questions are being asked about upcoming public offerings from Peloton and WeWork. Many of the venture-backed startups that are approaching the public markets are pursuing new, unproven business models. That can make it difficult for investors to predict the success of a particular IPO. 

Goldman Sachs analyzed more than 4,400 IPOs over 25 years and determined the most important attributes that can determine the success of recent public offering.

Here are the five key factors the firm says can make or break an IPO: 

Sector and industry

During the tech-IPO boom in the late 1990s and early 2000s, close to half of  new listings were either tech, media, or telecommunications companies. 

The sector breakdown for IPOs has changed considerably since the tech boom, according to Goldman Sachs. Tech, media, and telecommunications companies accounted for 19% of new listings since 2010, while health care IPOs surged to 34%. 

The growth in health care IPOs was driven by the rise in public offerings from biotechnology companies. Despite the swelling amount of listings, health care IPOs have performed the worst of any sector since 2010, according to Goldman Sachs. 

 



Firm age

According to Goldman, the age of company isn't a "significant indicator" of three-year IPO outperformance, but younger firms typically see faster sales growth. 

"The median firm founded 0-5 years before IPO reported sales growth of nearly 50% five quarters after the offering compared with 30% revenue growth for firms aged 5 to 15 years and 19% for firms older than 15 years," the firm said in a recent client note.

Tech companies over the last decade have waited historically-long to enter the public markets. Goldman said over the last two years the average tech, media, or telecommunications company has waited 13 years to go public. 

For example, PagerDuty was founded in 2009 and went public earlier this year, more than a decade after it started. 



Valuation

Many investors have raised questions about the valuations of companies that have gone public this year. 

"The most commonly raised concerns are that new firms are too expensive relative to their fundamentals and that demand for equity in new issues will diminish demand for the rest of the equity market," the firm said. 

WeWork, one of the most anticipated listings of 2019, has seen its valuation come under scrutiny in recent months.

The company was last valued at $47 billion during a private fundraising round, but now the company is rumored to be seeking between a $20 billion and $30 billion valuation for its upcoming public offering. 

According to Goldman, IPO's become more expensive compared the rest of the market shortly before a recession. At the height of the tech bubble in the early 2000's, IPO valuations soared past that of the median S&P 500 company. 



Path to profitability

A hallmark of this year's IPO market has been the concern about the profitability of the companies going public. High-growth, venture-backed companies like Uber and Lyft are burning through piles of cash to grow their businesses. 

According to Goldman Sachs, IPO investors are intently-focused on when firms will achieve profitability. 

"In the current IPO cycle, profitability in years two and three has indicated outperformance," Goldman said in the report.

The firm added: "Since 2010, IPOs with annualized sales growth above 40% from year 1 to year 3 and positive net income in year two have generated positive excess returns adn the highest likelihood of outperformance." 



Sales growth

Sales growth has been the strongest determinant of IPO outperformance, according to Goldman Sachs. 

"Since 2010, IPOs with annual sales growth greater than 20% have been more likely to outperform Russell 3000 over three years than a comparable, slower-growing IPO," the firm said. 

Revenue growth usually declines quickly during the first five years after a company enters the public markets, according to Goldman. High-growth companies often sacrifice profitability to pursue growth and gain market. That growth often slows in an effort to achieve profitability. 

Beyond Meat, a plant-based meat provider, has experienced massive sales growth this year and its share price has risen more than 500% in response. 



The CEO of Ace Hardware explains how his company, which boasts more stores than Home Depot and Lowe's combined, is going all in on the 'do-it-for-me' market

Sun, 09/08/2019 - 7:21pm  |  Clusterstock

  • Ace Hardware announced its acquisition of Handyman Matters, a home repair services franchise, on Friday. 
  • CEO John Venhuizen told Business Insider that his hardware cooperative is looking to tap into the "do it for me" market.
  • Venhuizen said that Ace Hardware customers have been "basically begging" the company to delve into the home improvement services sector.

Ace Hardware is jumping straight into the "do it for me market" with its acquisition of home improvement service chain Handyman Matters.

Business Insider spoke to Ace CEO and president John Venhuizen about what this acquisition means for the hardware retailers' cooperative, which now boasts more locations than the combined store count of competitors' Home Depot and Lowe's.

He said that the timing seemed right for the move, given Ace's growth trajectory. The Oak Brook, Illinois-based business opened 900 new stores in the last five years alone, bringing its total count to 5,300 globally. The majority of those locations — 4,600, to be exact — are in the United States.

"We feel like we have an incredible amount of momentum," Venhuizen told Business Insider. "There are not many retailers in the United States that are opening stores. Many are shutting them. We opened more than 900 in the last five years and we'll open more than 800 in the next five. We feel like we're aligned with what the consumer wants."

Venhuizen added that the company is on its 10th straight year of same-store sales growth. So where does Handyman Matters — which will be rebranded as Ace Handyman Services — fit into all that?

Read more: A Lowe's executive explains how the home-improvement retailer is making the most of its partnership with the NFL

The Colorado-based company boasts 57 franchisees across 23 states, employing a workforce of 250 handymen ready to help out customers with carpentry, flooring, painting, and other home improvement services. The Ace Hardware CEO says his retail's acquisition of the business represents a foray into the "do it for me" market. 

According to Venhuizen, customers have been "basically begging" Ace Hardware to launch in-house home improvement services offerings, and it aligned with the business's goal of being "the helpful place."

What's more, it ties in perfectly with the rise of the "do it for me" market; the contingent of home improvement shoppers who are looking to hire pros to do the heavy lifting on project through trusted retailers.

Venhuizen said that there's not much of a difference between the "do it for me" customers and the "do it yourself" shopper. Ultimately, it comes down to the customer's bandwidth for a new home improvement or maintenance task, level of expertise, and the nature of the project itself.

"It's this natural fit of bringing 'helpful' to the home, so that we have a service provider that can actually do it for the consumer," he said. "It fits naturally with what we're known for and the trust that our brand has engendered in these communities."

SEE ALSO: Home Depot execs reveal why the retailer is sharpening its focus on women shoppers

DON'T MISS: A look back at Lowe’s journey from small family hardware store to retail giant

SEE ALSO: A Home Depot exec explains why chasing trends is overrated in the home decor space

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Chinese exports to the US tanked in August as Trump's trade-war tariffs hit demand

Sun, 09/08/2019 - 7:12pm  |  Clusterstock

  • China's exports to America tanked 16% in August as Donald Trump's tariffs sapped demand for Chinese goods in their biggest foreign market.
  • Chinese imports of US goods dropped by about 22%, suggesting American exporters are also suffering from the trade war.
  • The declines will pile more pressure on Chinese authorities to stimulate the economy, days after they announced banks' reserve requirements would be cut to their lowest level since 2007.
  • View Markets Insider's homepage for more stories.

China's exports to America tanked 16% to $44.4 billion in August — a sharp acceleration from their 6.5% drop in July, Reuters said — as Donald Trump's tariffs sapped demand for Chinese goods in their biggest foreign market.

However, Chinese imports of US goods dropped by about 22% to $10.3 billion, official customs data showed. The steep drop suggests US exporters are also suffering from the trade war between the world's two largest economies.

Those declines are likely to accelerate in the coming months as both sides ramp up tariffs.

The Trump administration slapped a 15% duty on $112 billion worth of Chinese goods on September 1. If a trade agreement isn't reached, it plans to hike existing tariffs on $250 billion of Chinese goods from 25% to 30% at the start of October, and impose duties on another $160 billion of imports in mid-December. 

Meanwhile, China has targeted about $120 billion of US imports so far. It retaliated with its own tariffs at the start of September, and has a second batch planned for mid-December. Chinese officials are set to attend trade talks in Washington next month in the hope of striking a deal and avoiding those increases.

China's overall exports slid 0.1% in August, upending analysts' expectations of 2.2% growth, Bloomberg said. The surprise downturn could ramp up pressure on Chinese authorities to stimulate the economy. On Friday, the central bank said it would cut banks' reserve requirements, —  the amount of cash they have to keep on hand — to the lowest level since 2007 in a bid to boost demand.

SEE ALSO: American companies said they cut more than 10,000 jobs in August because of trade tensions

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THE MONETIZATION OF OPEN BANKING: How legacy institutions can use open banking to develop new revenue streams, reach more customers, and avoid losing out to neobanks and fintechs

Sun, 09/08/2019 - 6:02pm  |  Clusterstock

Open banking has arrived, and it's transforming the UK's banking landscape — next up could be the world. Regulatory efforts in the UK are transforming retail banking, reshaping incumbents' relationships with customers, and easing entry for fintechs.

Regulators across every continent are responding with actions of their own. Underpinning open banking initiatives is the idea that ownership of transactional data belongs to consumers instead of incumbent financial institutions.

The implications of this change for established lenders in the UK are significant. For those that act, open banking presents substantial revenue-generating opportunities.

But the consequences of inaction are even more severe: Business Insider Intelligence estimates that by 2024, £6.5 billion ($8.4 billion) of UK incumbents' revenues will be under threat of being scooped up by forward-thinking companies like fintechs and neobanks. Yet even through the financial incentives to act are clear, many incumbents are struggling to determine the best path to monetization. In fact, some aren't even sure what their options are.

In The Monetization of Open Banking report, Business Insider Intelligence identifies monetization strategies incumbents have at their disposal, describes how they can determine the best approach for their specific needs, and outlines actionable steps they need to make their chosen open banking initiative successful.  

The companies mentioned in this report are: Allied Irish Bank (AIB), Bank of Ireland, Barclays, Danske Bank, HSBC, Lloyds Banking Group, Nationwide, RBS Group, and Santander, Monzo, Starling, ING, Yolt, Fidor, BBVA

Here are some of the key takeaways from the report:

  • Driven by regulatory action, open banking is transforming the UK's banking landscape, but it's also gaining momentum globally.
  • For incumbents, open banking entails a significant threat to their entrenched position.
  • But for forward-looking banks, there are substantial opportunities for revenue generation, both directly and indirectly.
  • To seize these opportunities — and avoid losing revenue to fintechs and neobanks — it's critical that legacy players focus their efforts in the right direction, including identifying their strategic priorities.

 In full, the report:

  • Details the UK's Open Banking regulation in depth.
  • Forecasts the size of the UK's Open Banking-enabled banking industry over the next five years.
  • Discusses the types of monetization opportunities available for incumbents, as well as non-direct revenue-generation opportunities.  
  • Provides actionable steps on how banks can best determine the best strategic approach from the options available.

Interested in getting the full report? Here are two ways to access it:

  1. Purchase & download the full report from our research store. >> Purchase & Download Now
  2. Subscribe to a Premium pass to Business Insider Intelligence and gain immediate access to this report and more than 250 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> Learn More Now

The choice is yours. But however you decide to acquire this report, you've given yourself a powerful advantage in your understanding of the fast-moving world of fintech.

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Bitcoin 101: Your essential guide to cryptocurrency

Sun, 09/08/2019 - 1:02pm  |  Clusterstock

Bitcoin is everywhere.

The cryptocurrency is seemingly in the news every day as investors and businesses try to understand the future of this digital finance.

But what is Bitcoin all about?

Why is it suddenly on every financial news program?

And what does it mean to you?

Find out the answers to these questions and more in Bitcoin 101, a brand new FREE report from Business Insider Intelligence.

To get your copy of the FREE slide deck, simply click here.

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The tiniest apartment in San Francisco is just 161 square feet and will cost you over $2,200 a month — here's a look inside

Sun, 09/08/2019 - 10:04am  |  Clusterstock

San Francisco is home to the most expensive rental market in the country

Business Insider's Hillary Hoffower reported in May that the typical rent in San Francisco exceeds $4,500 — which is more than 2.5 times the typical national rent. 

Read more: The salary you need to comfortably afford rent for a two-bedroom apartment in the 25 largest US cities, ranked

The city is so outrageously expensive that some people are dishing out $1,200 a month for bunk beds in co-living buildings to save on rent

With the help of the rental platform Zumper, Business Insider was able to track down the tiniest apartment currently for rent in San Francisco. For $2,295 a month, you can rent a 161-square-foot studio in a swanky downtown neighborhood, but you may feel a little cramped.

Business Insider called and emailed the listing agent to find out how long the studio has been on the market but did not immediately receive an answer. A contact at RentSFNow  — the leasing side of Veritas Investments, the company that previously managed the listing — told Business Insider that the building had recently changed ownership and that contact information on the listing had not yet been updated.

Keep reading for a look inside.

SEE ALSO: Here's how much it costs to rent a one-bedroom apartment in 15 major US cities

DON'T MISS: NYC landlords were caught renting out 'micro rooms' for $600 a month. Here are 7 places in the US where you can legally rent an apartment for that much — or less.

The tiniest apartment for rent in San Francisco is a studio located in Lower Nob Hill. The apartment is within walking distance of the Financial District and North Beach.

Source: Google Maps



The studio spans just 161 square feet and is currently available for $2,295 a month.

Source: Zumper



It includes all the living essentials in one small room — sort of. For one thing, the studio doesn't have a bathroom. The future renter will have to use a shared bathroom.

Source: Zumper

 



The sink, which can be seen below, is right next to the studio's front door — and the kitchen seems to consist of that, a mini fridge, and not much else.

Source: Zumper



The studio did manage to squeeze in some space for a triangular closet, which is also next to the front door.

Source: Zumper



Beyond that, the studio has one window and a space heater. According to the listing, the unit comes with a dishwasher and in-unit laundry, but we couldn't find them in the listing photos — or, frankly, imagine where they could possibly fit.

Source: Zumper



$2,295 may seem outrageously expensive for a 161-square-foot studio — and it is. San Francisco is home to the most expensive rental market in the country.

Source: Zumper



But not all major cities are as wallet-draining as San Francisco. Just consider Raleigh, North Carolina, where the median rent for a one-bedroom apartment is $975 a month.

Source: Business Insider



Meanwhile, if you venture further up the Pacific Coast from San Francisco, the median rent for a one-bedroom apartment in Portland is $1,595 a month.

Source: Business Insider



The startups that hack your devices, WeWon't, and Goldman Sachs ruffles feathers

Sun, 09/08/2019 - 9:42am  |  Clusterstock

Hello!

The Israeli cybersecurity firm NSO Group has been accused of selling sophisticated digital surveillance technology to Saudi Arabia and other countries that are suspected of using it to attack dissidents and journalists.

It's also very profitable. 

Becky Peterson this week lifted the lid on the secretive startup, revealing NSO Group's profits and customer breakdown for the first time, and shining a light on a web of more than a dozen similar startups in Israel, many of which operate in secret, that sell attacks against routers, computers, smart speakers, and other digital devices.

As she reports:

These companies often describe their wares as "lawful interception" or "intelligence" tools, though this hardly tells the full story. They all sell tools that take devices and turn them against their users to secretly spy without leaving a trace.

Whatever you call this technology, business is booming. Governments and law-enforcement agencies around the world are paying millions of dollars. And startups both inside of Israel and out are ready to sell.

You can also read about how Becky got inside the NSO Group and the offensive cyber world in this Q&A

In other news, WeWork's IPO appears to be on rocky ground, and the company could cut its valuation by as much as half. Here's our latest:

What would you like to read more of? Let me know!

-- Matt

Watch

In Business Insider's latest webinar, Headset CEO Cy Scott walks through how he put together the pitch deck that helped him raise a $12 million Series A. Scott was joined by Poseidon Asset Management partners Emily and Morgan Paxhia, who led the round. 

You can watch the full webinar right here

Finance and Investing

Goldman Sachs' push into private equity is ruffling feathers at Blackstone — and it might be a sign of big client skirmishes to come

Goldman Sachs' latest strategy pivot is already raising hackles with one of its largest clients.

In related news, Marty Chavez, Goldman Sachs' trading chief, this week announced his plans to retire from the Wall Street firm at the end of the year. Dakin talked to him about the bank's tech transformation, why now is the right time for him to step down, and what he's planning next.

Barclays insiders say a hiring freeze is afoot as roles stay unfilled, bonuses get slashed, and senior staff flee

Barclays has raised the bar for hiring outsiders and is leaving vacant roles unfilled — resulting in what some insiders say amounts to an informal hiring freeze for investment banking, FICC trading, and certain back-office roles — according to five sources familiar with the situation.

Investors have triggered a recession signal with a perfect 50-year track record — and one expert says years of 0% market returns could be in store

Since the US yield curve inverted and startled the market, there's been a debate about whether the recession warning sign was for real.

Tech, Media, Telecoms

Here's the pitch deck $1.95 billion ThoughtSpot used to raise $248 million for an AI-powered analytics tool that's challenging Salesforce's Tableau

Founded in 2012, ThoughtSpot offers businesses a way to visually analyze their data in order to make critical decisions faster.

Amazon is rolling out a tool that shows just how much Google and Facebook ads drive people to do their shopping on the e-commerce site

Amazon is trying to grow its nascent ad business by proving it can show advertisers how digital ads drive people to shop on Amazon.

Comcast Ventures has a plan to jumpstart direct-to-consumers companies like Away and Hippo and it's already slashing their customer acquisition costs

With massive growth in venture capital, VC firms are scrambling for the chance to invest in the next unicorn by retooling their business models and looking for ways to differentiate.

Healthcare, Retail, Transportation

Furious Peloton members are skewering the company's delivery partner over broken $2,000 bikes and scratched hardwood floors — and the company is starting to take note

Todd Mitchell loves his Peloton. He didn't love the gummy grape candy that he said ended up stuck to his $4,295 treadmill during the delivery process.

Meet the 11 alt-meat startups vying for a bite of a $200 billion industry

The market for a burger without beef is beginning to sizzle.

Join the conversation about this story »

NOW WATCH: Here's what airlines legally owe you if you're bumped off a flight

4 people who bought life insurance in their 20s explain why they still think it was the right choice

Sun, 09/08/2019 - 9:30am  |  Clusterstock

Life insurance usually isn't top of mind for someone who hasn't made it to their 30th birthday yet. 

But it pays off to be ahead of the curve if you're expecting to have a family to protect one day. Generally, the younger and healthier you are when you buy life insurance, the cheaper it will be, regardless of the amount of coverage. 

In exchange for a monthly premium, a life insurance policy can replace income, help pay off debt, or provide a savings cushion for your partner or dependents if you die prematurely. 

In a series of stories written for Business Insider, four average people explained why they decided to buy term life insurance in their 20s — and why they're still happy with the decision. Here's what they said:

Clint Proctor bought a $500,000 life insurance policy shortly after becoming a dad and homeowner

When Clint Proctor and his wife became first-time homeowners in Florida and new parents within the same year, they decided it was time to protect their livelihood with a life insurance policy. 

Proctor was 25 at the time and chose a coverage amount equal to about 10 to 12 times his annual income. His $500,000 term-life policy costs about $21 a month.

"If I die before my wife, I don't want her to struggle to make our mortgage payment. She'll have enough stress without having to worry about losing our home," Proctor wrote. Now that he's changed jobs and expanded his family, he plans to add additional coverage.

"Having life insurance gives me peace of mind that housing won't be a concern for my wife and two boys. And that helps me sleep better at night," he wrote.



Holly Johnson pays $50 a month for two separate life insurance policies totaling $1 million

Holly Johnson, an editor and freelance writer, bought her first life insurance policy in her late 20s. It cost $25 a month for $250,000 of coverage lasting 30 years. 

Despite being debt-free, having above-average retirement savings, and earning some income from real-estate investments, Johnson later decided her family of four needed even more coverage. With an excellent health record, she took out another policy at age 37 and now pays about $50 a month for a total of $1 million in coverage.

"The reality is, having $1 million in life insurance coverage has allowed me to stop worrying about what would happen to my family finances if I died," she wrote. "I never lose any sleep wondering how they would pay for my funeral or whether my kids will be able to go to college, and I never stress over how my husband might pay bills or care for our two children if he were to suddenly lose my income."

 



Brynne Conroy bought a 20-year life insurance policy while pregnant with her first child

Brynne Conroy was pregnant with her first child in her early 20s when she decided it was time to buy a life insurance policy.

"As a parent, I knew it was only responsible to plan for the worst," wrote Conroy, a freelance writer, author, and blogger. "If I passed away, I wanted there to be enough money for my baby to be comfortable for a few years until their new guardian was able to adjust to the changed circumstances."

Because of pre-existing conditions, including a congenital heart defect, Conroy's monthly premium came out to $64 for $200,000 of coverage on a 20-year term life policy. As her income has gone up and she's expanded her family, she's continued to increase her coverage amount.

"There is a great peace of mind knowing that if I pass away in my prime earning years, my children will be OK," she wrote.



Eric Rosenberg bought a $1 million term life policy at age 28 and now wishes he had even more

Five years ago, before he had kids and a mortgage, Eric Rosenberg bought a $1 million life insurance policy to protect his future family.

He was in good health and locked in a rate of $78 a month for a 30-year term-life policy.

"I picked a $1 million policy because, based on our expenses and lifestyle at the time, it would have easily covered at least ten years of expenses not taking into account any investment gains on the proceeds," Rosenberg wrote. "But now that I actually have two kids, I sometimes wish I could go back and get a bigger policy that would have paid for college and a full mortgage payoff as well."

Still, he doesn't regret preparing early. In the years since, Rosenberg got his pilot's license and his father was diagnosed with cancer — two risk factors that would have significantly driven up the costs of his premiums had he waited to buy life insurance.

"I hope my family never gets the $1 million," Rosenberg wrote. "But if something happens to me, I'm not worried about my family struggling to pay the bills. That, after all, is what life insurance is all about."

Policygenius can help you compare life insurance policies to find the right coverage for you, at the right price»



This luxurious tiny home on wheels was made from a Mercedes-Benz Sprinter van

Sun, 09/08/2019 - 8:52am  |  Clusterstock

  • Motorhome maker Hymer and chemical company BASF have created the VisionVenture, a concept mobile tiny home using the chassis of a Mercedes-Benz Sprinter.
  • The VisionVenture has a roof and rear patio with a barbecue, bedroom, bathroom, kitchen, and living "room" that can double as an office space.
  • The home uses 3D printing, photovoltaic technology, and multipurpose furniture to create a self-sufficient space, according to Hymer.
  • Visit BusinessInsider.com for more stories.

Motorhome maker Hymer and chemical company BASF have partnered to create the VisionVenture, a mobile tiny home built on a Mercedes-Benz Sprinter chassis.

The concept car-home was created as a foreshadowing of what travel could be like by 2025, according to Hymer. The home uses modern technology to increase its self-sufficiency, including a solar panel-like photovoltaic system in the inflatable roof and paintwork that regulates the surface temperature and the interior of the home.

"A major source of inspiration for this project was the camper community, who have given us new impetus with their creative ideas and DIY conversions," Hymer President Christian Bauer said in a prepared statement.

Read more: This 'self-charging' electric car has a dashboard filled with dead moss to clean the air

Hymer utilizes many preexisting "tiny home" concepts that allow the compact Sprinter to feel more spacious, according to the motorhome maker.

For example, many elements of the home are multi-purpose, including a lamp that serves as the patio light, ceiling light, and an interior light pendant. The staircase, which leads to the roof, doubles as a storage unit, and the bathroom sink can be tucked away to make room for the shower.

"We are confident that we will be able to introduce some elements from this array of innovative and extremely customer-friendly solutions into series production in the not too distant future," Bauer said.

Take a look at the VisionVenture concept built on the same van Amazon uses to deliver its packages:

SEE ALSO: See inside one of the largest 'log homes' in the US: a $9.5 million mansion that comes with a temperature controlled 22-car garage

Hymer has partnered with BASF to create a concept tiny home on wheels, the VisionVenture.

The home is built on a Mercedes-Benz Sprinter chassis.

BASF, a German chemical company with a self-proclaimed focus on sustainability, provided over 20 materials for the home, including the paintwork, high-performance plastics, and slate veneers.

The home keeps the Sprinter’s doors, headlights, and radiator grille.

However, the windscreen, A-pillar, hood, and rooflight have been redesigned.

Parts of the home, including the wheel arch panel, were produced using 3D printing, which Hymer claims gives the parts a “robust, rubber-like quality.”

Hymer claims the paintwork can cool the surface temperature of the car by 20 degrees Celsius, or 68 degrees Fahrenheit, and interior of the vehicle by 4 degrees Celsius, or 39.2 degrees Fahrenheit.

The LED-illuminated staircase also has extra interior storage space.

The home comes with an inflatable pop-top roof with a seven-centimeter thick honeycomb wall for insulation. The roof can be inflated with either hot or cooled air and is photovoltaic like a solar panel, increasing its self-sufficiency, according to Hymer.

The interior of the Sprinter-home includes a private patio with a pull-out electric barbecue, kitchen, bedroom, bathroom, and living “room” that doubles as an office space.

Multiple decorations in the home are multi-purpose. For example, the wall covering was designed as a “rail system” that allows for storage or decoration hanging. The lamp can be moved and serves as a patio light, ceiling light, and light pendant.

The bathroom side wall unfolds to allow the sink to be stored away.

This leaves more room for a shower cubicle that has a rain shower function.

Hymer claims the concept car is a foreshadowing of what travel could look like by 2025.

Everyone has forgotten about why Donald Trump can't win a trade war with China

Sun, 09/08/2019 - 8:12am  |  Clusterstock

  • In all the chaos of markets convulsing and tariffs rising, it's been easy to forget the main objectives of the US's trade war with China.
  • And in doing so, it's easy to forget that those objectives are at odds with one another.
  • On one hand you have USTR Robert Lighthizer and his stated aim of turning China into a market-based economy. On the other hand you have Donald Trump, a populist obsessed with forcing China to buy more goods — a market distorting demand.
  • This inconsistency has seriously hurt negotiations, and contributed to putting China in a position where it cannot simply lose to Donald Trump. Under these conditions a stalemate is the best we hope for.
  • Visit Business Insider's homepage for more stories.

The markets have been a whipsaw, the US economy has slowed down, and one report suggests that US companies may have shed 10,488 jobs because of the trade war between the US and China — a trade war that has worsened over the last few weeks.

So the two sides have laid down their arms and agreed to a ceasefire in hopes of "creating the conditions" that will make it possible for discussions to resume in October.

Unfortunately those talks, should they ever occur, will achieve little aside from temporarily calming financial markets. Donald Trump's trade war is a trade war that cannot be won.

The reality is that from the start the objectives of Donald Trump's trade war have been at odds with one another, making it impossible for his administration to construct a deal that one might consider a win for US markets.

What's more, throughout this process, Trump's conflicting demands and brutish tactics have put Chinese President Xi Jinping in a position where he and his administration cannot concede. 

So we had better hope this ceasefire lasts beyond Trump's next tweet storm, because it's about as good as things are going to get.

Why Trump can't win

Before we get into any of this, let's remember that China has three demands that the US must meet in order to end the trade war. 

  1. That the US respect China's national sovereignty.
  2. That the US remove all tariffs it has imposed since the beginning of the trade war.
  3. That the US cease demanding that China buy an unrealistic amount of goods from the US.

Remember number 3, because it's the one that's really messing things up here. And of course it's the one Donald Trump is obsessed with.

It is easy to forget that initially this trade war was about making China's markets more fair for US businesses — ending favoritism for domestic companies, forced technology transfers, and intellectual property theft. Back in March 2018 the United States Trade Representative Robert Lighthizer wrote a report to Congress outlining all these issues and all the ways  China was in violation of World Trade Organization rules. It all made sense.

But at the same time there was Donald Trump and his obsession with trade deficits — with getting China to buy more US stuff. This did not, and still does not, make any sense. In sophisticated economies bilateral trade deficits don't mean anything.

Lighthizer wants changes that will make China a more free market economy like the US. Trump wants changes that further distort the Chinese economy by explicitly forcing it to buy goods from one place rather than another. The former is capitalism, the latter is Trump's variety of populist nationalism. And they do not play well together.

"There are various ways in the short run to reduce the bilateral trade deficit but this would be done in ways that are essentially market distorting," Carnegie Mellon University economist Lee Branstetter told Business Insider.

These two conflicting goals have repeatedly caused issues during the on-again-off-again negotiations. Think back to December: Trump ratcheted up the tariffs, China managed to negotiate a temporary peace by promising to buy US soybeans, negotiations resumed, and then collapsed as China refused to yield to the US's conflicting demands 

"Before Trump [making a trade deal with China] was always about setting the rules and structures and accepting the market outcomes," Branstetter continued.

Now it's about sales. 

And on the other hand, if Lighthizer's objectives — changing their rules to open up China for US companies — are met it's likely Donald Trump's core nationalist objectives — forcing companies to move to the US — will suffer.

"If China were to fix those problems, the result would be that the Chinese market would become more hospitable for American and other western companies to set up production within China," economist Chad Bown of the Peterson Institute told Business Insider via email.

"There seems to be a fundamental inconsistency between achieving that outcome, and the Trump administration's other economic nationalist priorities, which focuses on bringing manufacturing production back to the United States, even if that comes at the expense of everything else, including American farmers."

Why Xi can't lose

Making matters more complicated, on the other side of this deal we have Chinese President Xi Jinping, a man who cannot lose. There are political reasons for that, and there are practical reasons. On the latter point we need to return to Donald Trump's obsession with China buying more US goods.

Even if China could buy enough US goods to close its trade deficit, according to Citigroup analysts, the US doesn't have enough to sell to China without disrupting trade with its partners or changing US production.

From Citigroup:

"The US likely can increase supplies of soy products to China in the short run, as well as select meats. However, meeting the proposed $1.2 trillion of additional shipments of goods to China over six years, including energy, machinery and tech products, will require major adjustments in the US and China's current trading partners, as well as a reconfiguration of US domestic production of these items."

And Citigroup's researchers also found that when it comes to foods, motor vehicles, semiconductors, and aerospace, the US is at or near full-production-capacity-utilization rates. We can't make anymore. When it comes to energy and poultry, the US doesn't have enough to sell to meet China's demand.

Of course, there are also political reasons why Xi cannot just cave to Trump's demands.

Since talks collapsed in May Xi has adopted the language of struggle. He used the word around 60 times in a speech he gave last week. Using China's state controlled media he has cast the US as an aging power hell bent on stopping the country's rise. It is a position he and the Chinese Communist Party are very comfortable being in. It allows the party to blame its economic problems on the US, and it raises nationalist sentiment to a fever pitch that makes it impossible for Xi to lose face and back down.

So, what's this deal supposed to look like? What does a win even look like to Donald Trump? For some China watchers it simply does not exist.

"There's no deal to make," Anne Stevenson-Yang, founder of China focused investment firm J Capital Markets told Business Insider. "Everyone is going through a pantomime for the markets. It's super stupid that the markets believe it."

Join the conversation about this story »

NOW WATCH: Sharks aren't the deadliest creatures on Earth. Here are the top 10.

TECH COMPANIES IN FINANCIAL SERVICES: How Apple, Amazon, and Google are taking financial services by storm (AMZN, AAPL, GOOGL)

Sun, 09/08/2019 - 8:02am  |  Clusterstock

Tech giants are set to grab up to 40% of the $1.35 trillion in US financial services revenue from incumbent banks, per McKinsey. Three of the largest US tech companies — Apple, Google, and Amazon — are particularly encroaching on financial services and threatening incumbents with their size and ability to attract massive, loyal user bases.

Apple is deepening its financial services play as a means of invigorating revenue, and its expertise could make it a legitimate threat to legacy players. Google's platform-agnostic approach, wide international penetration, and top talent position it as a hub with unrivaled global reach beyond just consumer payments. And Amazon — which has eaten up market share in every industry it's touched, and now has its sights on financial services — could swiftly undercut legacy players.

In The Tech Companies In Financial Services report, Business Insider Intelligence will examine the moves that Apple, Google, and Amazon are making to gain a larger foothold in the global financial services industry. We will then detail each tech company's threat to incumbents and outline potential next steps based on their existing moves in the financial services sphere.

The companies mentioned in the report include: Apple, Amazon, Google, Goldman Sachs, Mastercard, Barclaycard, Citi, Chase, Capital One, Paytm, and PhonePe.

Here are some key takeaways from the report:

  • Apple's expertise in consumer-facing tech products makes it a legitimate threat to legacy players. Its next move could be a debit card or PFM app, both of which would be cohesive with its existing offerings.
  • Google's money movement and commerce services form a payments hub with unrivaled global reach. Google could pursue global expansion by modifying its offerings in other markets like it did in India, pursuing Europe, and even delving into digital remittances.
  • Amazon is an expert disruptor — and it has its sights set on the financial services industry next. Amazon could develop checking and savings accounts, bring Amazon Pay in-store, and white-label its Amazon Go store technology to deepen its financial services footprint.

In full, the report:

  • Outlines the threat posed by Apple, Amazon, and Google to legacy financial players.
  • Identifies each tech giant's strengths, weaknesses, opportunities, and threats moving further into financial services.
  • Discusses each company's moves in financial services and their anticipated next steps in the space.

Interested in getting the full report? Here are two ways to access it:

  1. Purchase & download the full report from our research store. >> Purchase & Download Now
  2. Subscribe to a Premium pass to Business Insider Intelligence and gain immediate access to this report and more than 250 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> Learn More Now

The choice is yours. But however you decide to acquire this report, you've given yourself a powerful advantage in your understanding of tech companies in financial services.

Join the conversation about this story »

A Harvard grad was the first employee at buzzy credit card startup Brex and says the experience was better than any MBA program she could have taken.

Sun, 09/08/2019 - 8:00am  |  Clusterstock

  • Larissa Rocha joined Brex, the buzzy credit card startup that caters to other startups, in 2017 after graduating from Harvard.
  • The Brazilian native met Brex cofounders Henrique Dubugras and Pedro Franceschi while they were building their first startup in Brazil. The group kept in touch even as Dubugras and Franceschi dropped out of Stanford to enter Y Combinator's accelerator program with what would become Brex.
  • Rocha has held multiple roles at Brex since joining more than two years ago, including sales, customer support, and engineer recruiting. She told Business Insider her time at Brex has been more valuable than any MBA program.
  • The buzzy startup has become the poster child for eye-popping growth and massive valuations in Silicon Valley, having raised more than $316 million in venture funding and achieving a $2.6 billion valuation in just two years, according to Pitchbook data.
  • Click here for more BI Prime stories.

If timing is everything, Larissa Rocha should teach a master class. And she might, as the new head of community at buzzy startup Brex.

Rocha holds the coveted title of Employee No. 1 at Silicon Valley's hottest startup, a credit card and banking system for other startups. In its two years of existence and Rocha's two years of employment, Brex has raised more than $316 million in venture funding and is worth $2.6 billion, according to Pitchbook data.

"I don't know what happens after 30 years, but I want to be at Brex for as long as we're building this and I will go wherever Brex takes me. It's my baby and we're here for the long term," Rocha told Business Insider.

Read More: Brex, the credit card for startups, raised $100 million at a $2.6 billion valuation — more than double what it was worth nine months ago

Unlike Brex founders Henrique Dubugras and Pedro Franceschi, Rocha took a sensible approach to entrepreneurship. Having grown up in a small town in rural Brazil, she was adamant about finishing her undergraduate degree in economics at Harvard before making the plunge. But she kept in touch with Dubugras and Franceschi, who she said she met while living in Brazil, even after they dropped out of Stanford to join Y Combinator with a new company that would become Brex.

"Henrique and Pedro are definitely a big reason," Rocha said of her decision to come to Brex. "They had that very clear vision of wanting to build something that will improve the world, and that really resonated with me. To have the chance to build that from scratch is so much more exciting and nerve wracking but more fun too."

Startup school

Since joining Brex in June 2017, two weeks after graduation, Rocha got to work. She said Dubugras and Franceschi tasked her with building spend models for startups at different stages so they could better predict what limits Brex should offer and what the market would allow.

"Even the ones that raised money, they don't want the credit," Rocha said. "They want just a payment instrument. No one was willing to give them one unless the founder was willing to personally guarantee it. And if you're an immigrant like we were, you don't even have that yet. So they said, okay, that's not right."

Rocha was heads down building a business development team when they noticed the startups' engineering team wasn't growing quickly enough. So Rocha stepped in and built a recruitment process for front end engineers.

"I hadn't even heard of that," Rocha said. "It was also a humbling experience in and of itself, trying to recruit for a company in stealth in the Valley."

Rocha said she built her own mentor network to help navigate the ins and outs of recruiting, and eventually hired a top-notch recruiting team to keep up with the growing company's needs. Then she moved to sales full time, and until recently, said the photo on her phone's lock screen was a screenshot of the first sale she closed.

Since then, she's led and built the customer support team in addition to the recruiting and business development teams. She is helping onboard 20 new hires every other week, and has started building Brex's suite of customer offerings as the company plans to expand beyond just corporate credit cards.

"I'm very, very grateful to have gone to school," Rocha said. "Having that opportunity to explore a lot of things definitely helped me to learn how to learn. But I think it's more effective than any MBA for me to have these on the ground experience here."

SEE ALSO: Activist investor Starboard bought a 7.5% stake in Box. Experts say that what comes next could be restructuring, layoffs, and maybe even a big sale to a competitor.

Join the conversation about this story »

NOW WATCH: Amazon is reportedly seeking a new space in New York City. Here's why the giant canceled its HQ2 plans 5 months ago.

'Abrupt and severe market losses': One expert explains why stocks are on pace to underperform the safest government bonds for the next 20 years

Sun, 09/08/2019 - 6:05am  |  Clusterstock

  • John Hussman — the outspoken investor and former professor who's been predicting a stock crash — sees the S&P 500 going absolutely nowhere for the next two decades.
  • He backs his thesis by highlighting hyper-valued stocks, weakening market internals, shrinking growth, and waning profit margins.
  • Click here for more BI Prime stories.

As the longest-recorded bull market in history stampedes forward, it's looking increasingly likely that investors will enjoy yet another year of double-digit returns.

In fact, as of today, the S&P 500 is up almost 19% in 2019, continuing to thrive in an environment where everything it's had to dodge a seemingly endless barrage of headwinds.

While some are delightedly riding the bull market's surge into new strata, others are positioning for a stern day of reckoning — and one renowned market bear thinks the market's historic run is setting up decades of pain for investors ahead.

That acclaimed market bear is John Hussman — the former economics professor and current president of the Hussman Investment Trust — and he's calling for more than 20 years of S&P 500 underperformance against the lowest-yielding and safest US government bonds.

"At extreme valuations, it's important to remember that the completion of a hypervalued market cycle can wipe out every bit of the stock market's total return over-and-above T-bills, going back not just a few years, but for over a decade," he said in a recent blog post.

He continued: "Within the 80-year period from 1929 to 2009, the S&P 500 took three long, interesting trips to nowhere, accounting for 53 of those years (1929-1945, 1959-1982, and 1995-2009), underperforming risk-free Treasury bills after all was said and done."

For context, Hussman characterizes a market that takes an "interesting trip to nowhere," as one with both steep losses and powerful advances along the way to — you guessed it — nowhere.

Hussman's rationale

Let's dig into that.

According to Hussman's favorite measure of valuation — the margin-adjusted, price-to-earnings ratio (MAPE) — the market is currently more overvalued than 1929 and 2000.

If those years sound familiar, that's because the former coincided with the worst economic event the US has ever experienced, where the market plummeted 86%. The latter is congruent with the bursting tech bubble, an event that lopped 50% off of the S&P 500. 

Below, you can see that Hussman's margin-adjusted, price-to-earnings valuation measure is towering near record highs.

But that's just the appetizer. 

To Hussman, an overvalued market isn't enough to warrant a crash. He needs to see internals diverging as well — and it just so happens that's exactly the case. Back in February, his view of internals shifted negative.

"I believe that the combination of hypervaluation and unfavorable market internals has opened a trap door that is permissive of abrupt and severe market losses," Hussman said.

The following chart depicts his proprietary S&P 500 return when market returns are across-the-board favorable against the benchmark's actual total return.

The stage is now set for what Hussman sees as a market that's getting ready to go nowhere.

A market that goes nowhere

"The current risk of yet another long, interesting trip to nowhere is easy to understand when one examines the underlying drivers of long-term stock market returns: 1) long-term growth in representative fundamentals; 2) changes in valuations (the ratio of market prices to those representative fundamentals); and 3) dividends received in the interim," Hussman said.

Let's break that down. 

There's no denying growth in the US is slowing down. In the second quarter of 2019, gross domestic product grew at 2%, a full 1.1% below it's first-quarter reading.

Structurally, Hussman has US economic growth pegged at just 1.4%. This metric reflects demographic labor force growth and trend productivity growth, barring forces of cyclical changes in unemployment.

Below, real structural growth is depicted by the red line, and is accompanied by the cyclical unemployment change to 8-year real GDP growth (green line) and the real US GDP growth 8-year average annual rate (blue line).

As you would imagine, slowing growth puts downward pressure on corporate margins. And although S&P 500 profits are teetering near record highs, Hussman wants investors to take heed: declines in margins often lag hiccups in economy-wide profits amidst nonfinancial companies. 

The graph below conveys this stark divergence.

These factors — along with assuming a 2% S&P 500 dividend yield — rounds out Hussman's criteria for understanding how stocks take a trip to nowhere: growth, valuations, and expected dividends.

Against that backdrop, it's time to do some math.

"The most reliable valuation measures we've identified across history are presently an average of 2.7 times their historical norms," he said. Assuming 4% nominal growth in fundamentals, and a future valuation multiple that simply touches its historical norm fully 20 years from today, the resulting average annual capital gain for the S&P 500 would be: (1.04)*(1/2.7)^(1/20)-1 = -1.0%."

Add in a 2% dividend yield, and we arrive at a 1% return over the next 20 years. A figure that will probably underperform T-bills.

"That's exactly how investors can get these very long interesting trips to nowhere," he concluded.

Hussman's track record

For the uninitiated, Hussman has repeatedly made headlines by predicting a stock-market decline exceeding 60% and forecasting a full decade of negative equity returns. And as the stock market has continued to grind mostly higher, he's persisted with his calls, undeterred.

But before you dismiss Hussman as a wonky perma-bear, consider his track record, which he breaks down in his latest blog post. Here are the arguments he lays out:

  • Predicted in March 2000 that tech stocks would plunge 83%, then the tech-heavy Nasdaq 100 index lost an "improbably precise" 83% during a period from 2000 to 2002
  • Predicted in 2000 that the S&P 500 would likely see negative total returns over the following decade, which it did
  • Predicted in April 2007 that the S&P 500 could lose 40%, then it lost 55% in the subsequent collapse from 2007 to 2009

In the end, the more evidence Hussman unearths around the stock market's unsustainable conditions, the more worried investors should get. Sure, there may still be returns to be realized in this market cycle, but at what point does the mounting risk of a crash become too unbearable?

That's a question investors will have to answer themselves. And one that Hussman will clearly keep exploring in the interim.

SEE ALSO: Goldman Sachs unveils 2 simple IPO-investment strategies that have crushed the market over the past 25 years

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The 15 highest-paid soccer players in MLS

Sun, 09/08/2019 - 5:03am  |  Clusterstock

  • MLS sides have a salary limit of just over $4 million per year, however three players at each club are permitted to be exempt from the cap.
  • "The Beckham Rule," introduced in 2007, allows clubs to nominate three "designated players" who they are allowed to pay as much as they want.
  • Major League Soccer currently has 65 designated players in the division, and Business Insider has listed the 15 highest earners below.
  • Read more of our soccer stories here.
  • Visit Business Insider's homepage for more stories.

Major League Soccer has long been a retirement home for some of the world's most talented soccer players. 

David Beckham, Kaka, and Andrea Pirlo are just a few of the high profile stars to have spent their yesteryears stateside after illustrious careers in Europe.

While ageing players still continue to flock to the division, the MLS is also becoming a sought-after destination for players in their prime, particularly those from South America.

Add an ever-growing pool of homemade talents into the mix, and it means the division is slowly but surely beginning to establish itself as an emerging power in world soccer. 

But as its quality has increased, so have the prices, and in particular, the wages, of its players. 

Read more: Garber's 20 years as MLS commissioner time of huge growth

The MLS has a salary cap which permits each team to spend no more than $4.035 million on its wage bill for the season, however since 2007 and the introduction of the "Beckham Rule," each side is allowed three "designated players" to whom the cap does not apply.

Since the rule's inception, there have been 144 designated players in the MLS, 65 of whom currently play in the division at the moment.

Business Insider has listed the 15 current highest earners, according to the MLS Players Association, ranked in ascending order:

=13: Nicolas Lodeiro — Seattle Sounders FC ($2 million per year)

Lodeiro has had what you might describe as a "journeyman" career having played in five different countries and three continents.

The 30-year-old has had spells in Uruguay, the Netherlands, Brazil, and Argentina — but it is in Washington, America where Lodeiro has found his footballing home.

The Uruguayan has made 103 appearances and scored 28 goals for the Seattle Sounders since joining it from Boca Juniors in 2016. 



=13: Tim Howard — Colorado Rapids ($2 million per year)

No goalkeeper in history has won more caps for the United States national team than Tim Howard.

The former Manchester United and Everton star played 121 times for country, before announcing his retirement from the international stage in 2017.

Howard's still doing the business in the MLS, but not for long — the Colorado Rapids keeper announced in January that he is to retire at the end of this season. 



=13: Jonathan dos Santos — LA Galaxy ($2 million per year)

The younger of the two Dos Santos brothers (the other being Giovani), Jonathan began his career alongside his sibling at Barcelona — the pair both having been graduates of the club's prestigious La Masia academy. 

They've have since followed eachother around the globe, first to Villarreal, and later to LA Galaxy, where Jonathan remains to this day. Giovani left Galaxy in July 2019 to move to Mexican side Club America.



12: Marco Fabian — Philadelphia Union ( $2.001 million per year)

Marco Fabian has played a big part in Philadelphia Union's ascension to the top of the Eastern Conference this season.

The Mexico international has scored six times for Jim Curtin's side, but more importantly, he's been a reliable rock in the heart of the Union's midfield, completing 86.5% of all his passes this season.



11: Carles Gil — New England Revolution ($2.1 million)

Gil became New England Revolution's record signing in January 2019, when it paid Deportivo La Coruna $2 million for his signature. 

The 26-year-old midfielder has, so far, proven a reasonable return on that investment, scoring nine times in 28 appearances — including five in six games between July and August.

 



10: Diego Valeri — Portland Timbers ($2.32 million per year)

An MLS veteran, Diego Valeri has made nearly 200 appearances in the American top flight since joining Portland Timbers in January 2013. 

The Argentine helped the Timbers lift the MLS Cup in 2015, was named the division's MVP in 2017, and has also been an All Star in each of the last three seasons. 

 



9: Nani — Orlando City SC ($2.333 million per year)

Nani is one of the MLS' most decorated players ever, having won 17 major trophies with Sporting Lisbon, Manchester United, and the Portuguese national team. 

While he's been excellent since arriving at Orlando City in February, it's unlikely that the 32-year-old will be adding an 18th piece of silverware to his cabinet anytime soon, with James O'Connor's side currently sitting ninth in the Eastern Conference. 



8: Josef Martinez — Atlanta United ($3 million per year)

Josef Martinez scored 35 times last season as Atlanta United lifted the MLS Cup for the first time in its history.

This term, he's continued that impressive form, scoring 28 goals, including scoring in each of his last 13 games. Find the net for a further eight games in a row, and he will break the world record held by Lionel Messi for the most goals scored in consecutive games. 



7: Wayne Rooney — DC United ($3.5 million per year)

Wayne Rooney's spell in the MLS has been brief, but boy has it been memorable. His highlights so far include a goal from the half-way line, a broken nose, and two red cards. Classic.

The Englishman is leaving DC United for Derby County in January, but that means there is still plenty of time for him to add a few extra shots to his American fim reel. 



6: Alejandro Pozuelo — Toronto FC ($3.8 million per year)

Alejandro Pozuelo had the big boots (metaphorically speaking) of Sebastian Giovinco to fill when he arrived at Toronto FC in March 2019 from Belgian side Genk.

So far, he's done a pretty good job, managing eight goals in just seventeen games from attacking midfield, including an audacious brace on his debut. 



5: Carlos Vela — Los Angeles FC ($4.5 million per year)

Vela is currently the MLS' top scorer this season having scored an impressive 27 goals. He's also managed 15 assists, making him the second best playmaker in the league. 

The Mexican's contributions have played a huge part helping LAFC attain a 16 point lead at the top of the Western Conference, and if it goes on to lift the MLS Cup — it's a safe bet that Vela will be named as the division's MVP.



4: Jozy Altidore — Toronto FC ($4.891 million per year)

During his last full season in the Premier League with Sunderland AFC, Jozy Altidore managed just two goals in 39 appearances.

That form earned him a one way ticket out of England in 2015 and back to the MLS with Toronto FC, where he's since found his feet again, scoring 68 times in 128 games. 

 



3: Bastien Schweinsteiger — Chicago Fire ($5.6 million per year)

Schweinsteiger's career took a very sharp decline when he moved to Manchester United in the summer of 2015. The German playmaker went from Bayern Munich favorite to bench warmer at Old Trafford, and eventually to United's U-23 team when Jose Mourinho took over as manager.

Thankfully for him, he was rescued by Chicago Fire in 2017, and he's since recaptured some of the form that saw him held in such high esteem in Germany. 

 



2: Michael Bradley — Toronto FC ($6 million per year)

Toronto FC captain Michael Bradley has played in the top divisions of Holland, Germany, Italy, and England, meaning he is one of the most experienced players in the MLS. 

He returned to the division where he began is career in 2014, and helped Toronto lift the MLS Cup in 2017. He's also been an MLS All Star in three of the five full seasons he's been with the Canadian outfit. 



1: Zlatan Ibrahimovic — LA Galaxy ($7.2 million per year)

It comes as little surprise that LA Galaxy forward Zlatan Ibrahimovic is the best paid player in the MLS. The man, who on more than one occasion has referred to himself as "God," takes in just over $7 million per year, or $135,000 each week. 

He's proving to be worth every penny for Galaxy though, having managed 44 goals in 49 appearances since joining them in March 2018. 





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