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Block Got Its Start Selling Payment-Processing Hardware, but That’s Now Less Than 1% of the Business. You’ll Never Believe What Its Top Revenue Stream Is Now.

When financial technology (fintech) company Block (SQ -1.39%)went public in 2015, back when it was known as Square, it explained its business in its registration documents like this: “We started Square in February 2009 to enable anyone with a mobile device to accept card payments, anywhere, anytime.” The company had a square-shaped credit card reader that plugged right into smartphones and tablets.

Block has more hardware devices today, and many people think of these devices when thinking about the company. However, through the first three quarters of 2023, the company has only generated $125 million in hardware revenue. This means that hardware sales are a measly 0.7% of its $16.1 billion year-to-date revenue.

On the other end of the spectrum, revenue generated from Bitcoin (BTC -0.91%) accounted for 43% of Block’s year-to-date revenue — its largest revenue source. But surprisingly, the purpose of this Bitcoin revenue stream isn’t dissimilar to its hardware revenue stream, as I’ll explain.

How are fintech hardware and Bitcoin alike?

Gross profit compares the cost of an item against its sales price. Let’s say someone makes a pizza with $5 of ingredients. If they sell that pizza for $10, their gross profit is $5.

For Block’s hardware, it has a negative gross margin — the hardware costs more to make than the sales price. The company’s 2% gross margin for Bitcoin is better, but it’s still not a big money-maker.

Why go to all the effort of making hardware and processing Bitcoin transactions if you aren’t going to make money off of it?

Block views fintech hardware as a way to expand its merchant customer base with its Square ecosystem, and it views Bitcoin as a way to increase its consumer customer base with its Cash App ecosystem. It’s not uncommon for companies to willingly lose money on customer-acquisition strategies in order to make money down the line from something else. That’s what’s happening here.

For both Square and Cash App, Block generates transaction-based revenue, as well as subscription and services revenue. And these are higher-margin propositions.

For transaction-based revenue, Block’s gross margin is about 42% — not too shabby.

For revenue from subscriptions and services, Block’s gross margin is even better, at 81%. And what’s exciting is that, through the first three quarters of 2023, this revenue segment rose an impressive 33% from the same period of 2022, making it Block’s fastest-growing

Bidenomics Puts Business, Not Workers, First

Before the war in Gaza — before Joe Biden sank his reputation by enabling Israeli brutality — there was a debate about something called “Bidenomics.” Despite everything that’s upstaged it, it’s still worth a look.

Bidenomics never got much love. Interest peaked in July, according to Google Trends, and is down three-quarters since. It probably would be hard to find someone who could define it. For the Right, it’s practically Bolshevism. The president himself defines it as “building the economy from the middle out and bottom up — not the top down.” It rests, as things so often do, on three pillars: “First, making smart investments in America. Second, educating and empowering American workers to grow the middle class. And third, promoting competition to lower costs and help small businesses.”

How’s all that stand up to reality?

By the conventional indicators, especially measures of the labor market, the economy is strong, though perhaps a little past its peak. Reported evaluations are far less sunny than the official stats, however. Most people tell pollsters the economy stinks.

After extraordinary rates of growth in 2021 and 2022 as the economy recovered from the COVID shock, job growth is now slightly below its long-term average. The unemployment rate in October was 3.9 percent, very low by historical standards, though up 0.4 from April’s trough (which was the lowest rate since 1969). That’s the official rate, aka U-3, which has a fairly restrictive definition of unemployment. By the broader measure, U-6, which captures more people at the margins of the labor force, it was 7.2 percent. That’s up from December’s 2022 low of 6.5 percent, which was the lowest in that measure’s history.

Workers look strong in the labor market — the official count of unfilled job openings, a measure of employer frustration, though off its highs of spring 2022, is still high by historical standards, and similar could be said of the quit rate, a measure of worker confidence. Here too it looks like the worker’s labor market power has peaked but isn’t collapsing.

Add to this big union victories, from riveters to writers, and the US working class looks to be in its best shape in decades — which isn’t saying much given the standards of our history, but still, it’s better than nothing. Strike activity, which was more discursive than actual over the last couple of years, is finally showing

Local business story of the year: Kamloops’ North Shore sees development boom – Kamloops News

Castanet is revisiting the top stories of an eventful 2023. Today, for our Kamloops business story of the year, we look at a trend of increased development activity taking place north of the river.

A drive along the Tranquille corridor past a number of construction sites confirms a trend seen in City of Kamloops data — the North Shore is alive with development, even on track to outpace other parts of the city.

Joshua Knaak of ARPA Investments, the development firm behind several projects on the North Shore, said he’s seen the area change since the company’s first neighbourhood build got underway about seven years ago.

“One of the things that’s funny is now we’re starting to hear questions about parking, where are people going to park. I think that’s a terrific issue to have here on the North Shore, because if we have parking issues, it means we actually have attractions,” Knaak said.

“Obviously it’s something that needs to get resolved, but I think that it’s a great problem to have.”

The City of Kamloops’ development, engineering and sustainability division reports that in 2021, it received 13 development permit applications for the North Shore and 39 for the rest of the city.

In 2022, the city received 18 North Shore development permit applications and 42 for the rest of the city.

As of last month, the city said it has received 21 development permit applications for the North Shore so far this year, compared to 19 for the rest of the city.

Jeremy Heighton, executive director of the North Shore Business Improvement Association, said he expects about seven buildings to go up in the area in the next couple of years — potentially as many as 11. He noted developments take some time to rise, and the process behind those specific builds started years ago.

“We’re seeing a draw to the North Shore for a number of reasons. Number one, when you’re putting [tens of millions] into a project, I think you need to know the community is going to embrace that project,” Heighton said.

“Here on the North Shore, I think we’re very open to the next steps.”

That observation is shared by Knaak, who moved his family to the North Shore in 2016, where they “fell in love with the neighbourhood and with the potential that we saw.”

Knaak said he noticed underused land on the North

The Business of MMA in 2023: UFC produced over $1 billion in revenue, PFL buys Bellator, fighters turn to OnlyFans

The global pandemic crushed a lot of businesses across the globe, but it’s safe to say the UFC is one of the biggest success stories to emerge from that disastrous time.

While the pandemic prompted down years for just about everybody, the UFC still exploded in popularity over the past three years, securing bigger sponsorship deals, higher viewership, and strangely enough an invulnerability to losing fan interest in events that didn’t always have great name value attached. Case in point: Conor McGregor hasn’t fought since 2021 yet the past two years have still been the best ever for the UFC financially.

Now that the UFC operates as a publicly traded company — first under Endeavor and now as part of TKO Group Holdings — financial disclosures are regularly reported. What that shows is that the UFC has become a juggernaut of profitability, with revenue increases quarter after quarter, transforming the promotion into a company valued at over triple the-more-than $4 billion price tag Ari Emanuel and his investors at Endeavor paid for it in 2016.

UFC went on a ridiculous streak of sellouts at arenas, and while that momentum eventually stopped, the organization has still broken several live gate records over the past year.

A deep dive into the numbers in 2023 proves that the UFC isn’t slowing down, and if anything, the organization may be gaining steam heading into 2024 and beyond — 2025 will almost assuredly become the UFC’s biggest financial year because the company will ink a new broadcast rights deal worth billions. Multi-billions actually.

But for now, we’re going to take a look at the biggest business stories related to the MMA world in 2023 — and just for transparency’s sake, there’s one issue we won’t be tackling with this article, which is the effect of the ongoing class-action lawsuit against the UFC. That’s not to say information revealed from the lawsuit won’t be referenced, but its full financial impact won’t be felt until there’s either a settlement or the case goes to trial, and that’s not happening in 2023.

So with that said, let’s get started with a look at the UFC’s financials based on disclosures through the first nine months of the year (the final quarter won’t be reported until early 2024 so those aren’t available just yet).

UFC Produced More Than $1 Billion in Revenue in Just 9 Months

That’s probably the most

Luxury Gifts That Billionaires Are Giving This Christmas

For the world’s wealthiest people, Christmas can look a little different.
The most sought-after gifts for the billionaire set can cost five figures — or more.
Here’s what the ultrarich have on their wishlists this year.

Money, a sweater, perfume, and a smartphone are among the most desired gifts in the US this Christmas, a recent Statista survey found. But unless that check under the tree is for $10,000 — the amount Warren Buffett used to give each member of his family — most of those won’t cut it when it comes to the gifts of the ultrarich.

“The most amazing thing about billionaires is that there tends to be no budget,” said Nicole Pollard Bayme, the founder of luxury styling firm Lalaluxe, which provides bespoke gift sourcing for clients. That “allows us to have unlimited imagination,” she added. For these shopping services, she charges a starting price of $600 an hour, plus a percentage of the cost of the items purchased.

Alongside Pollard Bayme, Business Insider also spoke to Winston Chesterfield, the founder of Barton, a consulting firm focused on luxury and the wealthy, and Elisabeth Brown, a client manager at travel and lifestyle concierge company Knightsbridge Circle.

They gave us their insights about what the richest people give and get for the holidays. The answers varied from the eye-popping — a $5 million villa — to the ear-pleasing — a Steinway in a stocking (well, not literally).

Here’s a look at the presents that the .001% are giving and receiving this year — and just remember, it’s probably best not to compare those socks you got from your mother-in-law with any of the items on this list.

Pianos: Multiple wealth experts said there’s been a newfound interest in giving pianos, and not just your average upright or electric keyboard.

Grand pianos — which can run to tens of thousands of dollars, if not more, Brown said — are a great gift for someone who actually plays, of course, but are also appreciated as a part of one’s decor.

“Our members appreciate the finer things in life, including good craftsmanship,” Brown said, “and a piano oftentimes can be a focal point of a room.”

Chesterfield added that a piano doubles as a party trick, with the wealthy hiring professionals