A basket of high growth internet companies (that exclude US and China mega caps such as Amazon, Facebook, Alibaba and Google) are trading below their long-term median multiples, according to the Speaker. He has assumed a 25 percent net margin for Uber as an example (the ride hailing giant is yet to turn a quarterly profit).

“Isn’t that being quite generous?” a participant blurts out loud. The Speaker doesn’t seem to think so. Uber’s management team has actually guided to 35 percent margins in the fullness of time.

“Just stay long,” said the Speaker. He is bullish on Uber (which has become a consensus long among hedge fund managers in this quarter) and China’s Pinduoduo. He is also an investor in Bytedance (the world’s most valuable privately backed startup) and Udaan (India’s fastest unicorn).

Source: Bloomberg, Octahedron Capital Estimates

Based on the Speaker’s analysis, the total enterprise value of the internet enabled economy will grow by 10x to $62 trillion by 2045 from $6 trillion today. Adding software and payments would imply the value creation could be even higher at $85 trillion. “Our estimates could prove conservative,” he says with confidence. The internet enabled market cap ($8 trillion) is currently 9.1 percent of the global market cap ($85 trillion). By 2045, he believes that internet enabled market cap ($66 trillion) could represent 14.4 percent of global market cap ($461 trillion).

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