Chamath Palihapitiya unveils $4.8 billion SPAC deal for real estate startup Opendoor
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- čas přidán 6. 09. 2024
- Chamath Palihapitiya’s SPAC Social Capital Hedosophia II will acquire Opendoor, an online marketplace for buying and selling houses. Palihapitiya joins "Squawk Box" to discuss his vision for the deal. For access to live and exclusive video from CNBC subscribe to CNBC PRO: cnb.cx/2NGeIvi
Chamath Palihapitiya pioneered taking private unicorns public by reverse merging them into special purpose acquisition companies - an idea he’s called “IPO 2.0.”
After his first iteration of doing so last year with space-tourism company Virgin Galactic, he’s found his next target: Opendoor, an online marketplace for buying and selling houses.
“These guys are my next 10x idea,” Palihapitiya said in an interview with CNBC, noting the prospect of generating returns worth 10 times the original investment.
The investment, announced Tuesday, amounts to more than $1 billion. Opendoor will receive $414 million from the capital generated from the April initial public offering of his SPAC, Social Capital Hedosophia II. Additionally, a group of investors, including Palihapitiya and funds managed by BlackRock, agreed to infuse another $600 million through a PIPE, or a private investment in public equity.
The deal values Opendoor at $4.8 billion - nearly equal to its 2019 revenue. The company’s earlier investors include General Atlantic, SoftBank’s Vision Fund and Lennar Corp.
“This is one of many milestones towards our mission and will help us accelerate the path towards building the digital one-stop-shop to move,” Eric Wu, who founded Opendoor six years ago, said in a statement. Wu will continue to lead the company, while Adam Bain, former chief operating officer at Twitter and director at Social Capital Hedosophia II, will join the board after the transaction is completed.
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If anything this is just a good example of presentation and how to promote a business.
Yeah, honestly. This was a masterclass in pitching a company. People are bashing this on the comment section, but the true audience for this pitch is the big investors and funds with millions of dollars to throw around looking for a steady company to invest in that has a decent upside potential.
👏👏💯
I wonder how Chamath would do on Shark Tank?
@@Rob-vg6lw more like how shark tank would do on chamath lool
Exactly!
Not sure what all the negs are about. Chamath is right on. Buying and selling houses really sucks. I mean, it really really sucks. It’s stupid complicated, unnecessarily expensive, super high stress, and over-burdened with parasitic fee-stealers - so pretty much everyone hates the process. If OpenDoor streamlines the crapola and eliminates the excessive headaches and gets rid of the stupid-high costs, it’ll be a huge winner. No listings. No showings. No offers and counter-offers. No offer fall-throughs. No 6% agency fees. No contingent on financing. No carrying two mortgages. Sheesh, sounds good to me . . .
It makes a ton of sense to move strongly into real estate market that is starved for innovation, and the timing couldn’t be better. I hope he succeeds - I’d love to sell a house without going through a blood-sucking crooked real estate agency. And screw the banks and their stupid “closing costs.”
Haha I couldn't have said it better.
you mentioned "unnecessarily expensive".With all respect, do you seriously believe that opendoors will give a cheap resonable price offer to the seller ? They prey on people who have no clue how much theire house is actually worth it and even then reparation and various other costs will eat the margins in no time ... and opendoors will be an even more crooked real estate agency because they have to be to succed against similar competitors
Dominic Dannies
We’ll see. I’ll bet they’ll charge less than 6%.
If people get a better deal from the real estate agents, they’ll stay there. I’m guessing that opendoor will be a winner.
These types of companies charge up to 14 percent of the sales price and in addition to that....get more deductions after thet inspect the home. They are looking for desperate and low knowledge folks.
MINDY MCCALL
Not OpenDoor. Try again.
This is a masterclass in how to pitch.
As an investor who likes to invest in early growth companies I really appreciate this SPAC wave. Sick of massive unicorns where only the rich get to participate and ppl with less $$ ,who are willing to do the dd may get a big 10x+ winner, are locked out.
Will be interesting to see how this one plays out.
He has proved prophetic in the past and had many Home Runs (Bitcoin, Tesla, etc), but also had some Strikes (Box, etc).
I am generally skeptical when they try to 'sell' Retail to come along for the ride.
Also, Chamath is a master salesman - he positions himself as an almost 'Robinhood' type character with rational takes on CNBC (i.e. 'hedge funds shouldn't be bailed out').
However, it's always worth remembering what he said in his 2017 Stanford talk: 'I want the f***ing money...I'll play the game and I'll win."
Sometimes, this can align with Retail, many times it doesn't...
Yup chamath has been corrupted by money. That Standford interview was pretty telling tbh
Easy easy money. Im buying every IPOA to IPOZ. Im following Chamath all the way through
Same. Virgin Galactic as well
Sheeps always lose
@@SupaChinido this sheep is a millionaire with thousands of tesla shares. You do you and lets check back in 10yrs.
Ajinomoto 🤣🤣🤣 not a millionaire by an impressive margin but getting there by following Chamath too ! Happy a millionaire thus already successful gentleman is doing the same !
Same! My first investment were 10 shares of IPOB and IPOC. I’m a bit conflicted about the D, E, F coming up though since i wanna focus all in Tesla for now.
Seems like all the real estate agents are crying in the comment section. 🤣
Sanil Artist no bro we int crying. The person that will sell their house at a discount never use agents anyway. By the way agents are 93%of all home sales 93%. I’m not saying the market won’t be disrupted I just don’t think open door will get it done.
Opendoor has a partner agent program so I guess they'd better send in their applications ASAP
So you are clueless. Sorry to say but this is not a real estate agent against disruption thing. This is a pump and dump scam warning thing. Opendoor can’t survive and you know nothing about real estate something I have been doing for 19 years now. I. Warning you fools that this is a loser and not to invest before you lose your shirt investing in this SoftBank cash out scheme.
They are trying to control the housing market, it's the wasteful democratic tax policies, crime and DA's that wong prosecute people dont feel safe, and things are not being kept clean, why stick around for this???
C A huh? How did you make a political statement out of Zillow starting a brokerage? If this a bot or what?
Chamath about to put an end to real estate agents careers, I say it couldn't have happened soon enough. Cut out all middle men.
there isn't going to be NO real estate agents - it will cut into the market .. he even said 4% market share. not 94%
some people will still prefer to deal with a human agent, but they'll be tougher to find and the best will rise while the slackers fall off
@@360.Tapestry in the short term yeah - but in the long term once the boomers have died out and it’s mainly millennials & alphas buying/selling/renting houses then platforms like OpenDoor will just become the norm.
I can't tell you how much I hate those little rats.🐀 They literally make money off of nothing.
@@360.Tapestry True. Top producing agents will find a way to create value. Everyone else will quit the business.
Opendoor stock went from 34 to 1.29 as of today
I'm a billionaire, learn how to say my name.
Cha Ma T
Pa-Li-Ha-Pa-Ti-Ya
People need to sell their second and third homes. I need a place to live.
@Alden Buyer don't let the crab people get you
I'm buying this. Chamath and Rabois are going to build big.
Hope you made some money! just looking into this now
In 2017, Opendoor sold 3,127 homes. It brought in revenue of $700 million. Its contribution profit was $31 million. But the company’s adjusted EBITDA reported a loss of $57 million, 8% of revenue.
Then, in 2018, Opendoor sold more than double the houses in 2017, selling a total of 7,470. And the company saw year-over-year growth of 159% in revenue, hitting $1.8 billion. Contribution profit increased year over year by 107% to $65 million. However, Opendoor’s adjusted EBITDA still reported a net loss of $131 million, or 7.1% of revenue.
Did Chamath have to pay for his infomercial spot on CNBC?
If he backs communist socialists like AOC why wouldn't he pay for a 6 min infomercial on CNBC?!
Yeah you know he payed big bucks.
I don't see how this is any different than the constant parade of CEO's on CNBC?
Lotta haters here...
Alden Buyer who is he scamming???
This guy is visionary!
I like Chamath but this does seem like an infomercial.
I like him and thought he was on shar tank.
My money is on RKT, and for that reason I’m out.
He is a master salesman, but yes exceptionally smart dude.
Yea but even if ppl don't like this, there is not much risk involved on the ground level. FOMO until merger will drive this to the mid 20's. That's just my personal opinion.
@@ermiaseritrea7119 There is no shortage of options for investors. This one, snowflake, CCXX, tesla, all the new EV startups, all the disruptive innovation companies. Now that more people are investing, they have to have a good sales pitch to attract the masses to pick their stock. I was just surprised that this seemed like a presentation/infomercial instead of an interactive conversation with the host. Only time will tell which will prove to be successful growth stocks! There's always index funds for those who want to play it safe and there are the ARK ETFs for those who want in on some of the disruptive innovation action without the risk of picking individual companies. Fun times!
Real estate industry is ripe for disruption and better results for buyer/seller. This happened to the world of wealth management moving from heavy commissions and has been a win-win for consumers and long term thinking advisors.
Next on the list of disruption Academia and Healthcare.
Aren’t Zillow and Redfin already doing this?
yes they are. This is a promotion for a company he is invested in.
70% market share... they are obviously not the leaders lol
stevenw373 yes and both are losing money faster then a drunk man in a strip club
This jack ass is forgetting the fact that an asset = equity + liability that liability you can conveniently ignore in an up market. Wait till it crashes in your face.
So they will take this loser company that’s losing money for the private sector and dump it on the public. So their private finances can cash out of this loser and dump their garbage business on the public.
70% bigger than the guy putting up the cardboard cash for your home signs!
🙄
The man the myth the legend.
There are so many nuances to house flipping, you have to be very hands and even then you are vulnerable to economic shifts.
So real estate is coming back folks. Buy now!
$10 then and $30 today as of 18 Dec 2020 👏👏👏
I'm on the fence on this company. I'm up 60%+ on IPOB so very happy so far whether I sell or hold as part of the speculative 5% of my portfolio (also includes IPOC, GBTC and Virgin Galactic). My experience with a similar company but for cars was their price was 40% lower than the price I was able to sell on my own. Housing is a bit different but it still needs to be convincing economically from a consumer's perspective.
i would just ride it out since you got it at $10+ i assume. i'm glad i bought some IPOC-U when it first came out, i would've bought IPOB if i knew it existed. just going to load up on IPOA to Z when they come out
I will ride it out after watching the investor presentation. Strong fundamental business model, product-market fit, growth potential. Strong commitment from existing shareholders, new shareholders, and Chamath.
Click access here for the presentation super informative:
www.opendoor.com/w/investors
@@iscratchmybutt IPOA came out and it merged with SPCE. so we have from IPOD to IPOZ left I guess
@@notnoternexto yeh. this could low key be some easy gains just hopping on IPOD-Zs when they first come out
I will purchase Opendoor shares.
I wonder how open door compares to zillow's plans of a similar model
I always wondered this. We literally just did a video comparing Zillow, Redfin and Opendoor
Zillow has the same program. Which is a better investment.. Opendoor or Zillow?
I'm up 63% on IPOB, Good stuff Chamath! Opendoor is more lean and has higher market share than Redfin and Zillow!
I remember when the stock was 10$ a share my rookie as didn’t put the trigger
Is it too late to buy now :(
Buy houses for cash? Sure I've seen that sign on the side of a motorway.
On a serious note, as the FT pointed out recently, the housing market (at least in the UK) is dominated by a small segment of wealthy consumers, renters are almost overtaking owners and high loan-to-value mortagages have been taken off the table by most high street banks rebalancing their risk.
The very Internet-savvy consumers they're aiming for here are exactly the kind of consumers frozen out of the housing market.
Why anyone will sell their property off market at undervalue to a cash buyer is beyond me.
@@DavidAnderson-jh4jq because its efficient and convenient.
"...and pass all those savings on to you" Yeah right, that's why all tech monopolies have such high valuations....if you look at all the investor material it justifies the huge losses now with an absolutely insane future monopoly profit based on TAM and ignoring the risk of being the biggest residential RE owner in any market it dominates.
OK so let me get this straight ....basically you're buying up properties that young investors like myself who want to buy properties .....as well as families who normally couldn't afford a property but may be able to afford it because it is bank owned or the owner is in need of selling..... Your company is then going to raise the price so that you can make a profit and sell it back to people who don't normally have enough money to buy that property.... without that distressed discount.... at a higher rate so you can profit. So open door is basically taking opportunity away from the average united states citizen who's trying to buy a home to aquire wealth or build a family... Sounds Legit 🐸☕
Yep, they will prey on people who can’t wait on an offer or are impatient. They will scoop up any foreclosures that are in decent shape. And cut out the little guys.
Pretty much
So you just don't want them to take away the profit that you would normally be sucking? Any investor/landlord drives prices up around them. I get your criticism and I actually agree with it, but you should be criticizing yourself as well
@@ryder848 It's all about scale. They could raise capital much faster and wipe out the little man.
@@ryder848 1. I dont ever tell another man what they should or shouldn't be doing 🤣 ... what I am doing is simply putting in public what is going on . The poor (not just black ) but all poor people in United States ( poor mentally because of the false education system which takes out financial literacy for the last 300 years ) have yet another means of freedom taken away from them by someone who did not come from the same background.. yes his family was broke but the education and knowledge of possibilities was still there so he was never poor .. and now he is taking more opportunities away from people like myself and others who are just finding ways to profit in a unjust economy..
im not staying its good or bad ... its inevitable 🤷🏾♂️ just point out whats going on ...
An infomercial spot on CNBC? How much did Chamath have to pay for that? Seriously CNBC, WTF?
Why is it an infomercial? Its breaking news and Chamath is a prominent investor, they do these so called infomercials with several companies going public like Lordstown motors etx
@@alihusssin4060 Hundreds of other interesting businesses that would love this kind of free advertising, but don't have Chamath's charisma, charm, connections.
@@duudleDreamz It took me about 5 seconds after he was introduced for me to think it's an infomercial.
Hey , thanks for bring in Chamath P. Can you upload rest of the interview please..
He forgot to mention they give lowball offers, charge up to 14 percent of the offer price as fees and finally....they inspect the home and get additional deductions based on the home inspection. If u want to sell your house below wholesale....u can put a sign in the yard with the low price and sell it immediately. Don't get suckered.
His story is just amazing!!!
A name from *SRI LANKA*
Go the Chamath, good concept to help home owners in general I feel its better. Feel a bit sorry for the real estate agents , but hey, their is always another job out their .
I’m more interested in the Back Door
high five!
Is this like when he told us to buy BOX 3 years ago and it’s still the same PPS
even worse it went down from when he stated
Your stilling holding the bag?
Kenny 21 I actually never bought it lol
He also recommended Tesla. Funny thing about the market, no matter how well you do, you always could’ve done better.
OR Tesla, Bitcoin, Zoom? all 5-to10x after he laid them out.
4.8 billion revenue but what is their profit margin - 2-4%?
At. Least at first.
Profitable in 2023 at the earliest. But slim margins.
Then again 5% margin works with volume/high pricing which is what homes are.
Costco is a 5% margin business but look at them. And my 20 pack of socks isn’t a house haha ....I think there is hope for open door.
Love Chamath but as a homeowner I would never agree to pay Opendoor 6-14% of the selling price in fees so they can give me a lower offer. Its a pass for me if I cant even see myself using the product.
Where did you get 6-14% fees of the sale price? That seems unrealistic but possibly more inline towards 3-5% which are RE agent fees plus incentive streamlined one stop shop and less closing fees.
@@samuellee6275 Directly from opendoor's website located at www.opendoor.com/w/pricing. It states: Beginning on September 2, 2020, for new offers, Opendoor’s service charge will be 6%. This is subject to change, and may vary from 6-14%.
@@splashwerks Super valuable information.
I bought 1200 shares..get in early CP is a genius
What platform did you use?
I wish I could be 10% as articulate as Chamath P. Very easy to follow his ideas and very elocuent storytelling
I know you have it within you. This guy has this talent after doing hundreds of presentations to investors. Remember, it takes about 10,000 hours of practice in any sports discipline to be a proffesional player and be considered for a spot in any olympics team.
I agree real estate needs big disruption, theres no doubt. But to charge up to 14% and have nothing but lowball offers is not going to fly with people. The idea is good, but I really cant imagine many people would be ok with this. The ones who will use this are probably people who need to move really quickly due to life circumstance - so time is of the essence. But those who want to test the market or want to sell their home for above market value (market value at least), will still go for a top broker to get that job done.
I've recently done a a few videos on AQB, it's gone up 25% plus this week though it could be a 5X stock in the next 8 years then could keep climbing to become a 20X stock in over the following 10 years or more, in my opinion.
Is there an updated Chamath interview since Opendoor went public as $OPEN?
Not a fan of the idea of a centralized entity owning a large share of the housing market. Looks like a monopoly that would put an end to another free market, much like Amazon did to retail
First come first serve 🥬🍓
lol centralization is caused by the free market xD
I think this sounds like it'll be disruptive, especially at a time when sadly lots of people may want to sell fast, or on the positive if they can afford it buy fast. I wonder if surveys are carried out on the property in case of issues?
NEED LOWER COST ESCROW, TITLE INSURANCE AND TRANSACTION COSTS
His Slack investment is going greeeeatt I guess:)
Just buy all three - ZG, RDFN and open door. There is a boom market in the online real estate sector. They will go up another 2-3 times or more. This was like renewable stocks in 2013 and 3d printing stocks before they crashed. Electric vehicles look like they are topping now too. This is the next bubble imo. BUY HIGH SELL HIGHER
opendoor is only in few states.. gonna take some time
I like this guy, very honest and speaks from his heart !
What metric makes Opendoor the largest online consumer real estate business?
It's nice to be along for the ride. Thank you Chamath.
You trust this guy , why he dump the stock , and where is he now .
What is this segment called on cnbc? (non-american so bare with me..)
What is this? Is it legal to just advertise your company on Tv without paying?
how you know he did not pay ?
Doesn't the so-called 'virtuous cycle' apply to most businesses today? Why is it specific to Opendoor?
Paid news story.
Well isn’t that business / stocks world in order for that company to then have more shares bought and then the ceo s do buy backs by restricting the amount of shares on the market
So many extra cost when it comes to purchasing a home! I wish it would be simpler.
Don't buy IPOs. Wait for things to settle and stuff to research.
I looked up Opendoor. They claim: "Pay just 5% in fees. That's 1% less than the traditional 6% and thousands in savings." That's ridiculous. Here in Canada they have companies charging only 2%.
I don't really see how this would help with unaffordable housing prices - cash purchase plus I assume sale at maximum profit... this seems to put housing even more out of reach for 'regular' folks - how would an individual compete with a corporation for housing?
What's the ticker symbol for this ipo?
He's never heard of Zillow has he?
2008?
invest in ipoc
CNBC, come on the show, we glady help you get rich by promoting your ideas.
Love it,good interview☝️✨
How would a company like this hedge its real estate price risk ?
CP, master narrative builder and laser on virtuous ecosystem identification.
Did I just watch an infomercial
store up treasure in Heaven.
Notice he didnt say when
the merger date was going
to happen
It's Free Real Estate!
This will be in the shadow of the Palantir IPO but possibly a better bet for your money!
Nice commercial
Can I get free 2 day shipping? its a no for me.
Virgin? I don't know about that one.
Too soon to tell but look at the other 3. He was not wrong. Although, I will not getting in IPOB but will for IPOC
Big news that Norway’s Sovereign Wealth Fund now invested in Bitcoin!
Bitcoin and Litecoin reward halving supply shock closer each minute..⌛️..⏰
2012 and 2016 halvings ignited 🔥 the exponential 2013 and 2017 price surges!
Sounds like the next WeWork is already getting traction 😂
ලංකාවේ 🇱🇰 💓 කවුරුවත් නැද්දෝ?
I m here... how are you?
Hii
What is going with these SPAC. It is all over the place, a true hype. I am feeling like the big guy have find a money machine but we the little guy does'nt get the ticket for the party. UNFAIR!!! RIGGED
you literally had the chance to buy under $12 for the last few months before the merger was announce. Way easier than trying to get shares on a traditional ipo day for a decent price. IPOB, SHLL, NKLA( which i sold on the way up) IPOA (now SPCE) ,OPES , Draftkings! etc. Get to work buddy do your research and get on the wave or stay behind saying is unfair. Always know and manage your risks accordingly tho
Ed XO what are some IPO’S to get into right now, ground floor. ?
i see buy your house signs for cash all the time, what's the difference?
not having to deal with a stranger that put up that sign. Probably get a higher offer since Opendoor is not really fixing up the house they are just flipping it as is and making money on both ends. A fee charged to the seller and a fee charged to the buyer. insanely fast closing for the seller too so very convenient for some. I'm not invested but this real estate industry might get disrupted for sure in years to come.
There is a list of the biggest concerns people have when buying/selling and opendoor and similar companies literally solve 90% of those issues.
Those people will run your pockets 🤣🤣🤣
They’ll really give you a low ball just to resell it at a profit.
Open is efficient and convenient.
This is infomercial. Does CNBC promote informercial these days?
Easy money
You know it!!!!
📈📈📈
Will Chamath make any money out of it ?
“Keep interest rates at zero for a very long time” Well that didn’t age well”😂… As of 11/10/22 OD is trading under $2 and I started a position of 1000 shares @ $1.77. Let’s see where this is in 10 years 🤞
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Trading Bitcoins as a beginner can be very difficult, but I'll refer you to a good Bitcoin Analyst by name Robert Denis, he has been of great help to me in making money on Bitcoins
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@@elmoreschroeder2990 How do I speak with Robert Denis to help me please?
@@leonardokessler6057 On his email
I don't know about IPO2.0, but TSLA2.0 is literally on a roll
Chamath is so damn clever 🙌🏼👏👍🏼👌☑️
You get 3 days to accept the all cash offer!!!! I don’t like to feel pressured like that personally.
Brilliant
Uhhh.... what's NPS?
Net promoter score - it’s a metric that companies and services use to judge quality based on consumer feedback.
@@rishchitre8457 Thank you!
Doesn’t Redfin already offer instant offers?
Is this an indication of a top?
Wealthy investors can't stand that someone else has been making money offering low ball prices on houses for years.
Yo...... Now if I was a betting man, this is the type of stock I'm talking about.
Gotchya!
@@francis1836 Do you see the SPACs? Incredible...
@@lkng4332 Almost too good to be true
@@francis1836 Almost...
this is the guy who designed facebook apps to be addictive and made millions and then years later says that social media is toxic. he is a hypocrit and conman
He is a businessman and he is in this business to make money. No hard feelings.
Keep your eye on Chamath folks...Buffett 2.0