As it seems, we’re in special times, the time of a stock market frenzy. The latest signal of a frothy stock market involves the new and popular social audio app Clubhouse and a namesake public company.

As it looks, many investors have apparently mistaken the Clubhouse Media Group (OTCMKTS: CMGR), a publicly-traded Chinese shell company that operates a collection of social media influencer houses and also has healthcare operations, for the Clubhouse app which is operated by a still-private company.

After the famed Tesla and SpaceX CEO Elon Musk recently made an appearance on Clubhouse that broke the app’s participation limits, it appears that the Elon effect took place, sending the shares of Clubhouse Media Group up over 100% on Monday before settling to trade up about 83% up on the day.

Riding the waves of outsized investor attraction, Clubhouse Media Group’s valuation now stands at over $1 billion, not bad for just being a namesake Chinese company with hardly any strong business.

The real Clubhouse is a social audio app that has taken the internet by storm. Still invite-only, it’s drawn a reported 2 million weekly active users and initiated plans for monetization. Just about a week ago, the barely one-year-old popular audio app was valued at $1 billion after raising private funding from a mix of venture capital firms.

In this case, we can say that the main takeaway is to be publicly-traded and pick a name that’s turning heads around the internet, then, you make very good money. Who could ever tell that a company operating a collection of social media influencer houses would be valued at above $1 billion?

It wouldn’t be the first time that naming similarities have led stock prices of publicly-traded companies to soar high. It was seen in the case of Zoom Video Communications, the popular videoconferencing app, and Zoom Technologies, a communications equipment company. It was also seen recently in the case of Signal, the popular privacy-focused chat app, and Signal Advance (OTCMKTS: SIGL), a company with admittedly only one full-time employee that now sports a market cap of over $400 million.

Clubhouse Media Group isn’t even the only stock benefitting from a supposed Clubhouse affiliation. Also doing so is Agora (Nasdaq: API), a Chinese audio technology company that’s rumored to be the foundation for Clubhouse’s audio app. It saw its shares rise over 44% on Monday to hit an all-time high of $81.48 per share, now sporting a market cap of over $7 billion.

Share this...

Facebook

Pinterest

Twitter

Linkedin

Whatsapp

Email

Print