Why A New Metaverse ETF Doesn’t Want to Be Meta on Facebook

Facebook’s parent company, Meta (FB), wants to be the first company you can think of when you hear the word metaverse, the new virtual 3D world that will be the future of the internet. Heck, that’s why Meta CEO Mark Zuckerberg changed the name of the social media giant to Meta in late 2021.

But according to Subversive Capital founder and CIO Michael Auerbach, Zuckerberg’s efforts will fail.

“We truly believe that Meta is not the company that built the Metaverse,” Auerbach told Yahoo Finance Live.

The CIO was very confident in his thesis, in fact, that it had acquired a permanent short position in Meta shares and voluntarily excluded it from Subversive Capital’s new metaverse-focused ETF Punk (PUNK).

“When we launched our metaverse ETF, we considered other… metaverse ETFs out there and we were the only actively managed metaverse ETF,” Auerbach said.

“We include companies that are building the infrastructure and applications for an interoperable metaverse that consumers want. And consumers today don’t want Meta, Facebook or Mark Zuckerberg to be the custodians of their digital future.

Meta is investing billions of dollars in its plans to turn the company into a metaverse-powered empire. Metaverse’s metaverse division, called Reality Labs, lost $ 20 billion in 2021 alone. And those investments aren’t expected to pay off for some time.

During the Metaverse earnings call on April 27, Zuckerberg tried to address investors ’concerns about how much the company would cost Metaverse investments, saying it would slow Metaverse spending going forward while guaranteeing Family activity profit with Apps.

“At Reality Labs, we’re making significant investments to provide the next platform that I believe is more important to our mission and our business, compared to the cost of today’s leading mobile platforms. I know it’s expensive. do it-it’s something that hasn’t been established before and it’s a new paradigm for computing and social connection.

According to Auerbach, the problem with Meta is that consumers will turn to other companies if they experience Metaverse. In fact, Meta can have a hard time maintaining user trust, especially following revelations from Facebook whistleblower Frances Haugen that the company is blindsided on a number of issues-from divisive sites to human trafficking.

“They’re looking for more experience, but there’s a real concern when it comes to the Facebook platform where people want the future of their lives,” Auerbach said.

Meta CEO Mark Zuckerberg focuses on the company’s future in growing the metaverse. (AP Photo/Alex Brandon)

Meta is currently working on several new virtual reality and augmented reality headsets in addition to the existing Quest 2..

Meta isn’t the only metaverse to play with, though. The online game platform “Roblox” has its own type of metaverse where users can switch their characters between different interconnected worlds, while Epic’s “Fortnite” evolves from a shooter to a place where friends can meet and watch concerts.

Microsoft, Sony, Google, Nvidia and many other companies have also invested in the technology in the hope that it will become as important as today’s smartphones.

Currently, the metaverse is still a niche product category. If it will explode and its consumers will absorb it, let’s see. But if that’s the case, Auerbach hopes Meta won’t join them.

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Do you have any advice? Email Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter at @DanielHowley.

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