Bi-monthly investor update 23rd October 2021

## **What we bought**

**SpaceX (Unicorn startup)**

We already have an allocation to SpaceX in our portfolio but we doubled down. We think Starlink's success will add another $80 billion to the valuation in the next few years.

**Untitled by Keith Haring, 1982 (Art)**

Haring’s iconic ‘dancing dog’ figure, as well as the bright day-glo paint, was prevalent in his early work. Similar paintings have appreciated by 19.8% per year historically. [See the painting.](https://www.artsy.net/artwork/545256c9726169128d980500)

**Vacation rental properties (Real estate)**

Our real estate portfolio consists of data centers in Europe and Asia Pacific and logistic properties like distribution centers in the US. We've added a portfolio of vacation rental properties in California. The investment capital is used to purchase and renovate properties that are listed on websites like Airbnb and earn when they're rented by travelers. We estimate rental yields of ~28% pre-tax.

**Bordeaux futures (Wine)**

In Bordeaux, selling futures or shares of wines still aging in barrels has been occurring for decades. Over the years, it has evolved from merchants and négociants buying wine to assist cash-strapped wineries with their cash flow issues into a yearly spectacle and celebrated part of the Bordeaux wine industry.

**About Keith Haring**

Keith Haring rose to prominence in 1980s New York within the East Village art scene alongside Jean-Michel Basquiat. Haring united the appeal of cartoons with the raw energy of Art Brut artists such as Jean Dubuffet as he developed a distinct pop-graffiti aesthetic that comprised energetic, boldly outlined figures against solid or patterned backdrops. His major themes included exploitation, subjugation, drug abuse, and the threat of nuclear holocaust; Haring boldly engaged with social issues, especially after receiving an AIDS diagnosis in 1987.

![Untitled artwork by Keith Haring, dated October 1982](https://hedonova.b-cdn.net/Hedonova%20images/%20All%20Hedonova%20blogs/Bi-monthly%20investor%20update%2023rd%20October%202021/117214-1635037292-d7hftxdivxxvmcloudfrontnet-4.webp)

## **What we sold**

**PayTM (Unicorn startups)**

PayTM is the ubiquitous Indian payment super app. The company has filed to go public in India and local regulations do now allow investors to exit their holdings for 1-year post-IPO. In order to reduce liquidity risk, we have exited 25% of our holdings and continue to hold the rest.

**P2P loans - Brazil**

Latin Americans dominate beauty pageants. They've also dominated the spending on cosmetic surgery. We've been funding P2P lending marketplaces in Brazil which specialize in lending for different kinds of cosmetic surgery. So much so that the Government subsidizes half a million surgeries.\
\
Brazil’s government has been hit by the resignation of top officials in its economy ministry, as mounting concerns that Brasília will circumvent fiscal rules in order to boost welfare payments rippled through its financial markets. With his popularity flagging ahead of elections next year, President Jair Bolsonaro wants to expand a cash transfer programme for the poorest families in Latin America’s most populous nation.

I think given the turmoil, the *beauty subsidy* will be among the first to go causing systemic turmoil in the space.

## **What we're thinking**

**Increasing allocation to Palantir**

A leaked document from TechCrunch dated 2013 confirmed twelve government agencies were using Palantir, including the CIA, DHS, NSA, FBI, the CDC, the Marine Corps, the Air Force, Special Operations Command and some more.

The Economist was correct when it recently stated that Palantir is “more than a technological project, it is a philosophical, even political one.” Palantir is the revered Silicon Valley technology company that makes enterprise software that helps the US military and Fortune 500 companies make data-driven decisions.

We're thinking of increasing allocation to Palantir. Listed stocks in our portfolio serve the purpose to add liquidity. We exit them to honor redemptions so we need to be invested in equities that are not volatile, can give us high returns, and are liquid. Palantir checks all the boxes.

![Three US military men performing a parachute jump from a plane](https://hedonova.b-cdn.net/Hedonova%20images/%20All%20Hedonova%20blogs/Bi-monthly%20investor%20update%2023rd%20October%202021/117214-1635070207-defense-hero-3.webp)

**Exploring alternative real estate**

Three megatrends — a continued shift toward renting, a transformation of the US healthcare system, and a rise in the digital economy — will drive long-term outperformance in the alternative housing, healthcare, and technology real estate property types. The alternative sectors are likely to become more mainstream in the next decade as investors realize how crucial it is to increase diversification within their real estate portfolios.

![A pie chart showing the percentage of traditional and alternative factors](https://hedonova.b-cdn.net/Hedonova%20images/%20All%20Hedonova%20blogs/Bi-monthly%20investor%20update%2023rd%20October%202021/117214-1635023278-public-real-estate-b.webp)

## Other updates

![]()

**A technology office in Tallinn, Estonia**

Our technology team has a new home in Tallinn, Estonia. The country has a vibrant ecosystem of developers, a talent pool we can tap into.

![A view of Tallinn's old town with red spires](https://hedonova.b-cdn.net/Hedonova%20images/%20All%20Hedonova%20blogs/Bi-monthly%20investor%20update%2023rd%20October%202021/117214-1635037912-mari-mur-1jea5idonqe-unsplash.webp)

Thank you for reading through. Connect with me on [LinkedIn](https://www.linkedin.com/in/sumanbannerjee/) or email me at suman@hedonova.io

In our 2021 portfolio update, several investments were made and sold. The investments include doubling down on SpaceX due to the anticipated success of Starlink, purchasing Keith Haring's artwork with a historical appreciation rate, acquiring vacation rental properties in California for high rental yields, and participating in Bordeaux futures as part of the wine industry tradition. On the selling side, Bitcoin exposure was reduced for portfolio stability, a portion of PayTM holdings were exited to mitigate liquidity risk, and concerns about Brazil's government instability led to the decision to sell P2P loans in the cosmetic surgery market.


Bi-monthly investor update 23rd October 2021

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