Rivian
Description
Happy Monday everyone! š Welcome to the first ever RoboStox newsletter report! If you enjoy this, feel free to forward or share with your friends. Original Photo: Courtesy Rivian (Creative Commons License: CC BY-SA 4.0) šµ How They Make Money On the face of it, Rivianās core business is pretty simple. They manufacture and sell electric vehicles. Their first 3 vehicle models include: the R1T pickup, the R1S SUV and the electric delivery van (EDV) designed for Amazon. But the company also plans to add a number of recurring revenue streams including: level 2 autonomous driving software, insurance and telematics, fleet management, and cloud services based on Amazonās AWS. š± Product So far Rivianās products have received rave reviews. Motor Trend magazine called Rivianās R1T model the āmost remarkable pickup weāve ever seenā. Marques Brownlee (MKBHD), an influential tech reviewer described Rivian as āthe most impressive electric truck I have ever seenā. Brownlee has 15.2m subscribers on YouTube and 5.2m Twitter followers. In the companyās latest letter to shareholders, they reported an increase in the number of pre-orders from 55k to 71k. This shows healthy demand and strong desirability for the product among consumers. š Key Financials At the time of writing, Rivian was valued at a market cap of $76bn. (Ford is currently worth $98bn). Generated total revenue of $1m on losses of $82m in Q3 2021. Raised total of $20bn to date: $13.7bn in their recent IPO. $1.2bn in convertible notes. $5bn in the private markets. Income Statement: operational losses of $776m in Q3, (up from $289m during the same period last year) Cash Flow Statement (including capital expenditure on factories etc): negative cash flow of $1.15bn in Q3 (up from $435m last year). šØ š© Leadership Rivianās CEO is 38-year old R.J. Scaringe. By all accounts he is a car fanatic and dreamed of starting a car company since high school. He completed both his masters and PhD in mechanical engineering from MIT. After graduating he went straight to starting Rivian. He has spent 12 years at the company to date. In Packy McCormickās āNot Boringā newsletter he challenges readers to find a ācleaner or more singularly focusedā LinkedIn profile. Prior to the IPO Scaringe successfully raised $5bn in the private markets from many blue chip investors including the pension funds of American Airlines, Costco, LāOreal, Toyota, and many others. But, unlike Elon Musk before Tesla, Scaringe does not have a track record of successful exits or starting other companies. š Bull Case Electric car companies are not judged by the market purely on current revenue and profit. The stock price will be determined primarily on whether it can hit its delivery targets on time. Rivian has built a strong aspirational brand aimed at the affluent outdoor demographic which could be very lucrative. The 71k pre-orders from consumers backs this up.