This month, fintech startup Longfin became the first company to go public on Nasdaq under Reg A+, which allows smaller firms to sidestep onerous SEC filing rules. To celebrate the achievement, LongFin CEO Venkat Meenavalli rang Nasdaq's closing bell Thursday, consolation for the fact that Longfin ended its second day of trading down more than 20 percent.
But things picked up Friday morning, when the company announced with great fanfare that it had acquired Ziddu.com, “a Blockchain-empowered solutions provider” that operates in the highly sought-after business of “Microfinance Lending against Collateralized Warehouse Receipts in the form of Ziddu Coins.”
Predictably, the LFIN ticker exploded on the news. By noon the stock was up around 200 percent. Traders seemed to be undaunted by (or unaware of) the fact that Ziddu is owned by none other than Venkat Meenavalli, CEO of Longfin, a fact that somehow didn't make it into the press release. Who cares if it smells – it worked.
And so far, it always works. With cryptomania in full bloom, smaller companies have found they can multiply their stock prices several times over by slapping “blockchain” onto their names or rebranding as “cryptocurrency mining” operations because they rigged up a spare MacBook to harvest litecoin. In October a biotech concern refashioned itself Riot Blockchain and saw its share price triple. This week, Rich Cigars – which did just what it sounds like it did – renamed itself Intercontinental Technology Inc, in order to reflect “its entry into the business of cryptocurrency mining by our ownership and operation of multiple cryptocurrency mining machines.” The stock jumped 33-fold.
We could bemoan this idiot turn in public markets. No one could be proud of the unseemly rush to rebrand as some ersatz version of what's already a ludicrously overhyped fad in order to cash in on transient paper gains. We could even lament the fact that pikers like Riot Blockchain and Intercontinental Technology are stealing a little spotlight from crypto projects that might actually be innovative and successful someday.
Alternately, we could fling ourselves mindlessly into the manic fray and give in to the allure of the blockchain. Which is exactly what we recommend Blue Apron does.
As regular readers know, the Dealbreaker team doesn't doubt the merits of Blue Apron as a company, per se, just as a publicly traded one. Nearly two quarters into its life on Nasdaq, Blue Apron has delivered on its business promises just about as well as it delivers prepackaged meals-in-boxes, which is to say not very well. Even after a desperate executive reshuffle it's clear that Blue Apron's only hope, if they're being honest with themselves, lies in the gentle embrace of Walmart.
But why be honest with themselves? At 50 percent down from the IPO price and nowhere to go but down, it's time for Brad Dickerson to embrace both the future of business and the failure of Blue Apron qua Blue Apron. It's time to become Blue Crypto.
Or Bit Apron or Blockchain Provisions or Transcontinental Decentralized Solutions Inc or whatever, who cares. Just get some crypto verbiage in the name and a few lines of copy explaining how crypto-secured tokens traded over decentralized ledger will fundamentally reshape the way urban millennials cook chicken satay from a box. It cannot not work.