Daily Tech Snippet: Thursday, November 12

• After Square and DropBox, possible decline in Snapchat valuation signals trouble for unicorns: The worth of hot technology start-ups seemed for years to go in only one direction: straight up. Now there are signs of growing unease over the dizzying valuations of some of the most richly priced private companies. The latest sign has emerged with one such favorite, Snapchat, being discounted 25 percent by one of its more recent investors, Fidelity, the mutual fund giant. Another start-up, Dropbox, the widely used file storage service, was devalued by the giant asset manager BlackRock this year. The funds’ markdowns may tap the brakes on a fast-growing market. Investors, in the hopes of getting a piece of the next Facebook or Google, have been pouring billions of dollars into young private companies. Yet the public stock market has cooled for new technology companies: witness the current effort by Square, a mobile payments company, to go public at a valuation lower than what its last private investment gave it. The moves by Fidelity and BlackRock reflect how mutual funds can create challenges for technology’s favored start-ups, just as they helped inflate valuations in the first place. Over the last few years, mutual funds fought to buy pieces of appealing venture-backed companies like Snapchat and Dropbox. The idea was that public investors wanted to own these start-ups because their value was growing faster than that of many publicly traded companies. By owning the private shares, the large mutual funds would also get to know the start-ups and be well positioned to buy their shares when they went public. As mutual fund and venture capital investors jockeyed with hedge funds and sovereign wealth funds to invest, their abundant capital pushed prices for private shares into the stratosphere. Snapchat, for example, is valued at more than $16 billion and Dropbox at around $10 billion. The biggest prize of them all, Uber, is now seeking a round of investment that would value the company at $60 billion to $70 billion. Uber’s success with that round would be a further test of investors’ appetite. The competition among investors also helped create a herd of dozens of “unicorns,” a term for private companies valued above $1 billion, coined when such a phenomenon was still considered rare. Yet unlike venture capital firms, mutual funds are legally obligated to value each of their portfolio holdings every day, including hard-to-value assets like shares in private companies, and they must report these values at least every half year. A spokesman for the Investment Company Institute, one of the largest mutual fund associations, said that the process was a “good faith determination” of what an owner could get in a sale of the asset.

• Hands-On With Facebook Notify, A Push Notification News App And Twitter Alternative:  Facebook released Notify, an app for reading customizable breaking news, info, and entertainment push notifications right on your lock screen. Notify lets you select from over 70 publishers and customize your alerts to only send you news about specific companies, cities, sports teams, music genres and more. Each is sent as a push notification and shown in the Notify app’s feed for 24 hours, and can be clicked through to read an associated link. Today Notify becomes available on iOS in the US. It doesn’t offer the real-time discussion and independent voices of Twitter, but could provide an alternative for Twitter lurkers who just wanted real-time information and aren’t interested in building another audience to broadcast to. Though Notify won’t feature any ads for now, there are certainly opportunities to offer sponsored suggestions for accounts to follow. As long as Facebook can get enough of its 1.55 billion users on Notify to justify the work publishers are putting in to produce content there, it could create the real-time, urgent, high-signal information channel the News Feed could never be. I spent some time with the Notify team and played with the app myself, and here are my hands-on thoughts. What’s really special about Notify is the granularity of alerts you can get. While general Twitter accounts feature a broad range of content that might not all be interesting to you, Notify lets you subscribe only to the very specific sub-topics that are relevant. Facebook has worked with 70 launch partners to create Notify stations, including The New York Times, CNN, Huffington Post, Vanity Fair, Techmeme, Fox Sports, Epicurious, Comedy Central, Fandango, BandsInTown and The Weather Channel. Many offer both general news stations and ones with options to follow specific sub-topics. Tapping a station lets you preview its content by showing the last 20 notifications it sent. Publishers use a special interface to write notification text, select a link, and then publish or schedule their alerts. There’s also an API for programmatic distribution of weather forecasts, sports scores and other structured data. Working out these partnerships is what led to the leaks about Notify this summer from The Awl and Financial Times.
• Alibaba Sites Sold More Than $14 Billion of Goods in a Single Day: Alibaba’s consumer shopping sites sold more than $14.3 billion of products on its biggest shopping day of the year, called Singles Day, marking around a 57 percent increase over last year’s total. The total for the last 24 hours, to be precise, was $14,341,847,366.00, according to a spokesman. To give you a sense of how big this sale is, the $14.3 billion figure is just 27 percent less than the $19.6 billion worth of goods that eBay sellers sold in July, August and September combined. The number also dwarfs the $2 billion Americans spent on Cyber Monday desktop shopping in 2014.