It’s been a quiet week given the Thanksgiving holiday. I took a few days off to eat, drink, and be merry with family, and hope you did the same!

But there’s plenty on the investing front that caught my eye over the past several days, so it’s time for me to get back in the saddle.

So, I’m taking some time this weekend to kick off a new recurring piece by popular demand: Let’s call it “Saturday Stocks and Startups” and see if that sticks.

Since I departed 7investing earlier this year, I’ve received many requests from readers for a central place to follow my thoughts on investing in both publicly traded stocks and private startups — particularly beyond my musings on Twitter (it’s still not “X” to me) and my rudimentary author page at The Fool.

Because I’ve since launched more free-ranging coverage on startups here at Bottom Line Investing — and noting much of my work on public stocks doesn’t always translate effectively to the Fool’s article-style format — it seems a logical next step to extend my research on publicly traded equities here to BLI as well.

Without further adieu, here’s what caught my eye in the worlds of stocks and startups this week:

On stocks:

Merger arbitrage with Amazon/iRobot

Shares of iRobot (IRBT) closed up 39% yesterday after Reuters reported Amazon (AMZN) is finally poised to win the EU’s unconditional approval to close on its $1.7 billion acquisition of the home robotics specialist.

It’s a drop in the bucket for Amazon considering the e-commerce giant generated free cash flow of over $8.7 billion last quarter alone. But the deal also has broad implications for Amazon’s capabilities in not only the home-robotics space, but also smart homes and home security. Remember Amazon also owns Ring and has deployed hundreds of millions of Alexa/Echo-enabled devices.

Those of you who’ve followed my work for years know I owned shares of iRobot for over a decade, and only sold after Amazon’s initial acquisition announcement at $61/share in August 2022. There is some merger arbitrage opportunity left for traders willing to bet the deal goes through without another price reduction; even after this week’s pop, iRobot stock trades around $41.48 per share — a roughly 20% discount from the latest agreed acquisition price of $51.75 per share.

Noto resumes buying SOFI

Meanwhile, after a nearly six-month hiatus with no new purchases, SoFi Technologies (SOFI) CEO Anthony Noto has resumed buying shares of the fintech and banking stock on the open market. Noto picked up another 66,500 shares of SOFI for almost $445,000 (an average price of $6.68 per share) in two transactions this month, most recently including a 22,500-share purchase on November 21. For reference, Noto now personally owns a whopping 7,239,289 shares of SOFI.

The timing is no coincidence, as SoFi stock promptly gave up its post-earnings gains late last month despite a quarter that effectively crushed expectations on all metrics. Noto may have wanted to make a statement as well on the heels of stock sales from a few other insiders in recent weeks — including SoFi Bank president Chad Borton, Chief Risk Officer Aaron Webster, and Chief Marketing Officer Lauren Stafford Webb — nevermind that each of those insiders sold a similar number of shares back in June, and the sales followed not long after the execution of (likely related) vested stock-option awards.

In any case, if we’re interpreting this along the “does this actually matter?” scale of insider transactions, Noto’s repeated purchases dating back to the start of 2022 weigh significantly more for me than the sales of any other executives. I still own my shares, and remain convinced that the market won’t be able to ignore SoFi’s strength forever as it marches toward both sustained GAAP profitability (expected in Q4 2023) and Noto’s longer-term goal of becoming a top-10 banking institution in the U.S.

Nervous retailers: Underpromise, overdeliver?

Speaking of holiday purchases, as the pace of Q3 earnings releases wound down this week, I’ve noticed a pronounced trend of retailers appearing nervous ahead of the key holiday-shopping season.

I read statements from dozens of retail executives — from Dick’s Sporting Goods to Abercrombie & Fitch, American Eagle Outfitters, BJ’s Wholesale, Tapestry, Best Buy, Nordstrom, Burlington Stores, and Kohl’s — warning of the potential impact on consumer demand stemming from the uncertain macro environment.

I can’t help but wonder, however, if they’re underpromising with the intention of overdelivering when all is said and done in Q4.

Indeed, the S&P 500 has rallied hard in November on the heels of encouraging data in last week’s Consumer Price Index report that showed inflation was essentially flat sequentially in October. Wall Street appears to be betting this will mean an end to the Fed’s historic interest-rate hikes, and could eventually pave the way for the first interest-rate reductions some time next year. Suffice to say that’d be great not only for consumer demand, but also for the stock market in general.

Two Startups to Consider

Another chance to invest in Future Cardia

Given the timing of our launch of Bottom Line Investing almost exactly one month ago, I’d initially lamented missing the opportunity to write about Future Cardia, a med-tech company that’s developing a tiny insertable cardiac monitor device that detects early signs of heart failure before symptoms arise.

Future Cardia’s current RegCF offering on StartEngine was initially set to close last month. But lucky for prospective investors hoping to get in early, it was recently extended through January 17, 2024. The company has already raised more than $1.9 million from over 1,400 investors this round (with a minimum investment of $265.50) at a roughly $40 million valuation.

Future Cardia aims to disrupt an estimated $5 billion market by tackling one of the most pervasive healthcare problems: Cardiac arrhythmia and heart failure, which lead to difficulty breathing and frequent hospitalizations. The company claims that its device can reduce hospitalizations by a significant margin, saving billions per year in healthcare costs. Future Cardia is backed by major investors, including Sand Hill Angels, has previously raised $8 million (including $6.6 million previously crowdfunded), and has received positive feedback from cardiologists and patients.

Its device uses multiple sensors to measure heart rhythms, heart sounds, cardiac pressure, and activity, and then implements artificial intelligence (AI) to analyze the data and provide actionable insights. It can be inserted under the skin in a quick and easy procedure, and has a short regulatory path to approval with an existing insurance reimbursement model.

Future Cardia is a shining example of how AI can transform the healthcare industry and improve the lives of millions of people. And I think patient, long-term investors willing to bet on its success will be more than pleased with their decision if all goes as planned.

If you’re interested in investing in Future Cardia, you can visit their StartEngine page here to learn more about their technology, team, and vision.

_{Keep an eye on Mode Mobile}

Finally, meet Mode Mobile, a mobile technology startup focused on turning billions of smartphones into “the world’s most accessible income generating asset.”

Mode Mobile has created the first phone (the EarnPhone), operating system (EarnOS), and app (the EarnApp) that lets people use their smartphones to earn money by doing everything from listening to music and playing games to shopping, reading the news, and even charging their devices (ads can be displayed on the charging screen). To date, Mode Mobile’s more than 40 million EarnOS account users have already earned and saved $250 million globally, and the company generated cumulative revenue of over $50 million by the end of 2022 even as its product remained in its beta stage. Mode Mobile is fostering multiple revenue streams, including direct app downloads, direct-to-consumer subscription sales (for its EarnPhone device), sales to retailers (it’s already available at Amazon, Best Buy, and Walmart), and sales and licensing opportunities with both wireless carriers and OEMs.

Mode Mobile estimates its total addressable market is worth over $1 trillion. While I typically balk at sky-high TAM projections, I have no qualms with that figure in this case given the sheer scope of its product offerings.

Perhaps unsurprisingly, Mode Mobile has already attracted capital from institutional investors including Romar Capital Partners, Innovate Indiana, Merrick Ventures, Garland Capital, and Pallasite Ventures.

On the crowdfunding front, it previously raised $1.235 million from over 11,000 investors in its first-ever RegCF round back in August. But that crowdfunding round was closed and oversubscribed in just over a month. So Mode Mobile responded by opening an additional allocation to meet retail investor demand — and promptly met its max goal of $5 million from over 17,000 shareholders earlier this week.

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So where does that leave other prospective investors today?

Accredited investors can join the waitlist here for additional allocations. And given the overwhelming demand for its previous crowdfunding rounds, I’d be absolutely shocked if Mode Mobile didn’t pursue a larger Reg A+ round — similar to the round StartEngine just completed — some time in the coming months.

The Bottom Line

I’ll continue to provide updates on publicly traded equities and private investments that catch my eye in future “Stocks and Startups” posts at Bottom Line Investing. I also intend to flesh out my theses in both Future Cardia and Mode Mobile — including notable risks and any red flags to watch — in separate pieces going forward.

So stay tuned for more. And thanks again for joining us in your investing journey.

Like all of the startups (and most of the stocks) I’ll profile here at Bottom Line Investing, I’m excited that our story is still its earliest stages.