Post #85: The new normal

Have you just been on a Zoom call prior to reading this piece? Or maybe you’ve been in touch with one of your colleagues via Teams? Perhaps you’ve been peckish and just ordered some food online? Alternatively, maybe you’re having some down-time and you’ve just posted on Instagram? All these activities are almost too mundane to merit mention, but this fascinating chart we came across earlier in the week shows the extent to which we are becoming (or have become) digital by default.

You would be far from in a minority had you done any of the above: every minute, Zoom hosts 208,333 participants in meetings, Microsoft Teams connects 52,083 users, 555 meals are ordered on Doordash and 347,222 users post stories on Instagram. Perhaps what is most remarkable is that when one compares what happens in an Internet currently, the picture is very different to that of 2019

As we have discussed with some regularity, the COVID-19 pandemic has changed how we do things. We believe the habits formed during this unique period will be very hard to reverse. Put another way, we have crossed the digital Rubicon. This is why over 6,000 Amazon packages are shipped every minute or almost 1.4m video/voice calls occur every 60 seconds – simply because it’s the new normal. Why shop or go to the office if you can do it from the comfort of your own home?

We heard a similar message from Dan Schulman, the Chief Executive of PayPal, when we listened to him speak at a conference earlier this week. He noted that as a result of these unprecedented times, digital adoption had accelerated by “at least three to five years.” Interestingly the aforementioned chart of our digital lives shows that Venmo (a mobile payment service for money transfers, owned by PayPal) sees ~$240,000 sent via its network every minute. When asked whether people’s behaviour might change once government restrictions on their activities were withdrawn, Mr Schulman was emphatic in stating that “I don’t think there is any going back from this.” 

Disclaimers

The document is provided for information purposes only and does not constitute investment advice or any recommendation to buy, or sell or otherwise transact in any investments. The document is not intended to be construed as investment research. The contents of this document are based upon sources of information which Heptagon Capital believes to be reliable. However, except to the extent required by applicable law or regulations, no guarantee, warranty or representation (express or implied) is given as to the accuracy or completeness of this document or its contents and, Heptagon Capital, its affiliate companies and its members, officers, employees, agents and advisors do not accept any liability or responsibility in respect of the information or any views expressed herein. Opinions expressed whether in general or in both on the performance of individual investments and in a wider economic context represent the views of the contributor at the time of preparation. Where this document provides forward-looking statements which are based on relevant reports, current opinions, expectations and projections, actual results could differ materially from those anticipated in such statements. All opinions and estimates included in the document are subject to change without notice and Heptagon Capital is under no obligation to update or revise information contained in the document. Furthermore, Heptagon Capital disclaims any liability for any loss, damage, costs or expenses (including direct, indirect, special and consequential) howsoever arising which any person may suffer or incur as a result of viewing or utilising any information included in this document. 

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