Tekcapital (LON: TEK) is a tech investing company listed in London. The shares are up 6% this morning as it announces to an admiring world that, in fact, it owns 67% of Innovative Eyewear (NASDAQ: LUCY). The point of this being that LUCY stock jumped 200% and more yesterday on the announcement of their merger of intelligent eyeglasses and ChatGPT. Yes, it is true that there's a slight difference in the sizes of the two companies by market capitalisation but it is also true that we'd expect a better than 6% rise in TEK off the back of a 200% rise in the 67% owned subsidiary, LUCY.
Think on it, the rise in LUCY was of the $15 to $20 million sort of size, the rise in TEK has been of the $2 or $3 million size, and 67% of $20 million is very much more than $3 million.
So, a reasonable starting point here is that London is very less impressed than New York is with these new smart glasses. We might have found a reason why tech stocks prefer to list in the US even, valuations are higher.
Tekcapital share price from London Stock Exchange
The corporate announcement is here and it has a very nice reference to this being the 150th anniversary of the first QWERTY typewriter. But it could be that the QWERTY comparison is exactly why this isn't about to lead to boundless buckets full of money for either Innovative or Tekcapital.
People did make a lot of money out of typewriters, that's absolutely true. That was a manufacturing process which had economies of scale and all that. No one made money out of QWERTY - patents, copyrights and trademarks be damned. Because obvious ideas are obvious and no one could prevent a specific keyboard layout. So, what do we think CHATGPT eyewear is more like? Or, to be more accurate about what Innovative Eyewear has actually announced, an app that leads to ChatGPT being available on varied connected devices, including AirPods and so on? It's certainly possible to think that this will be more like QWERTY and thus the Innovative rise is going to fade away - so the Tekcapital rise is the more realistic one.
It's also possible to think the other way of course, this making Tekcapital a very cheap way of buying into the Innovative success.
