Amazon digging grave ⚰️

Didi's stabbing, Fantasy dollars, and IPO season.

Sep 22, 2021

Hi 👋, Tanvi here.

Filter Coffee hits your inbox every morning with notable tech and business news scoops to jump-start your day.

Let’s go ahead and get started:

Market summary: 📊

India quickly shrugged off the Evergrande-led sell off to resume upward journey on Tuesday. US had a mixed day, with tech ending in the green.

US:

S&P 500 - down 0.081%
Nasdaq - up 0.10%

India:

Nifty 50 - up 0.95%
Sensex - up 0.88%

What’s brewing hot? ☕

✅ Not a good look — bribery allegations are drawing too much heat to Amazon. Turns out the company spent 20% of its India revenues over the past 2 years in legal fees, which if you know how Bezos likes to run his ship, is incredibly out of order. Suspicion is that maybe the legal-fees paid as bribe incident from yesterday wasn’t an isolated one, but standard operating procedure. In any case, trade bodies and regulators are demanding investigations.

✅ Critical time for real estate — pandemic battered real estate business is holding breath for festive-season driven recovery. Developers have been aggressively investing, finishing projects early — with major urban regions seeing ~50% jump in volumes of new units listed for the second half of 2021, than the first. Meanwhile, banks from State Bank to HDFC to Bank of Baroda are all slashing interest rates to sweeten the deal. How consumers react could decide the fate of the market for the next 2-3 years.

Another one of those days with nothing major happening, but a series of tiny things ruling the headlines… Quick rundown!

Quick look at the DiDi fiasco 👀

What happened — investors in Didi (the Uber of China) had a mini-heart attack when Reuters broke rumors that one of the co-founders is leaving the company, while the Chinese government gets into the driving seat. Didi was quick to deny it.

If you remember, Didi had IPO’ed to much fanfare in July 2021, only to tell investors a week later that China is investigating the company, and now IPO-investors are holding the bag on the stock which is down nearly 55% since.

While we’re on China, ☝️

Troubled real estate developer Evergrande owes about $100 million in payments to investors this week, for which it obviously doesn’t have the money lying around — unless it sells some of its properties overnight.

China hasn’t said a word yet, and default would mean investors moving to claim Evergrande’s assets, catalyzing a financial Armageddon.

Who got the dough 💰

Payment processor Razorpay picked up a check from Salesforce Ventures to scale its neobanking and spending management platform RazorPayX. $$ amount wasn’t known.

Digital push post-COVID changed the fortunes of online payments companies and Razorpay is seeing 45%+ monthly growth in volumes in the past 6 months, and an expansion into SouthEast Asia is also one of the primary mandates right now. Good luck!

Then turning heads to edtech, 📚,

Expertrons, a career-coaching platform, raised some $$ from angel investors Kunal Shah and Anant Maheshwari. The company runs a network for students and early professionals looking to connect with experienced folks for mentorship and guidance. Experts get to make a quick buck via consultations, while students get to earn referrals.

There’s good money in fantasy sports 🔥

Your average unicorn may be struggling to bring in $$, but not Dream 11. Entrackr says the company grew its revenues by ~170% YoY for the year before COVID, with profits growing at a much faster rate.

Quick look at stats:

Revenue of ₹2,070 crores in FY20
Profits of ₹180 crores, from losing ₹90 crores the year before
Nearly 70% of all expenses were marketing related

Growth has held steady during COVID, and with IPL fever resuming, revenues should easily top ₹4-4.5K crores for 2021.

Meanwhile, Fantasy and NFTs mix in Europe, 🤝

Fantasy football platform Sorare raised a mammoth $680 million Series B round at a $4.3 billion valuation from Softbank, and Bessemer Ventures, apparently to double down on Sports NFTs. Sorare has about 600K users on its platform who create teams, compete with friends, and trade sports cards and memorabilia, with transactions topping $150 million a year.

Closing out — IPOs be buzzing again 💪

Paras Defense, a manufacturer of components used in defense machinery and space projects, primarily opto-electronics for thermal imaging and night vision apparatus, opened its IPO for subscription yesterday— with stock oversubscribed ~17x on Day 1.

The company makes about ₹140 crores in annual revenues, and is raising ₹170 crores to fund expansion of manufacturing facilities and invest in machinery.

Investors are hoping that an increase in spending on defense systems as well as India’s buzzing space industry will help make its fortunes. But, Paras’ overdependence on GOI (and its political and electoral mood swings) is the biggest overhang to the business.

What else are we snackin’ 🍿

📽️ Desperate for growth - Netflix launched a free mobile plan for Android users in Kenya, hoping that helps jumpstart subscriber growth.

🥳 Close call - Justin Trudeau reclaimed his position as the Canadian PM after his Liberal party won by a minority.

✈️ Gates open - the US will open its borders to travel for all vaccinated citizens starting November, overturning a Trump era move after almost a year and half.

Hit that 💚 if you liked today’s issue.

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