Bye Bye Harley 👋
IPO surge, AI raises, and updates from techland.
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Market summary: 📊
Things went crazy south in the Indian markets on Thursday with both indices having their worst drop since May. Ouch. US markets showed some heart however making a meek turnaround. Try not to look at your portfolios!
US:
S&P 500 - up 0.30%
Nasdaq 100 - up 0.58%
India:
Nifty 50 - down 2.93%
Sensex - down 2.96%
Latest from Consumer Tech 👀
Let’s do a quick rundown of all the little things that happened in tech land yesterday—
Twitter takes an audio-turn 🐦
Despite a lacklustre response to voice-tweets, Twitter is now looking to bring audio messages to DMs, allowing users to send 20-second clips, kinda like Whatsapp audio texts. A pilot will go live in Brazil next month.
Twitter has lately come to realize that advertising is perhaps not the best business model for the company after repeated innovation in formats failed to drive meaningful growth. Management has been hard at work to rally the product around the needs of its “power users”. Rapid experimentation on all fronts that is likely to continue for a while.
Few speculate a “subscription model” facilitating content consumption from the accounts/people you love in all formats — audio, text, video, — inherently monetizable, is perhaps the direction in which they’re headed. E.g. all podcasts + videos + essays from startup-gurus for $5/month?
Maps get a COVID shield
Google Maps will overlay a COVID-map on its view to help users understand the number of cases reported in and around their geographic locations. As the world grapples with possibilities of repeated waves, consumer tech is vying to do its part.
The feature will be out on Android and IOS this week and will be made available for all the 220 countries and territories that Google Maps currently works in. Just last month had Apple and Google both announced contact tracing by default in upcoming OS versions.
And, standing tall against Apple 🍎
Epic Games, Spotify, and Match Group (owner of Tinder) have grouped up to form an alliance to pressure Apple to change its marketplace (App Store) policies that these developers believe are no longer sustainable and harm competition.
Called the Coalition for App Fairness, the primary agenda is set to get app commissions reduced. Other independent developers have been invited to join the plot. Does Apple care?
Local IPOs received warmly 🙌
With a bunch of high-flying successes recently, the Indian IPO market (which had been weak so far in 2020), seems to have taken a turn for liftoff.
Most recent bid to hit the race track running is Computer Age Management Services or CAMS. The ₹ 2,200+ crore raise has been oversubscribed by over 45 times by the public, inviting bids for some 60.3 crores shares against a 1.3 crore availability. The high net-worth portion of the sale was oversubscribed by even more, demand up 112 times.
CAMS, a broad financial infrastructure and services provider to the mutual fund and investment management industry, handles transfer of mutual funds and sells everything from KYC tools to back-end tech, to help clients streamline operations, handle compliance and such. Founded back in 1980s, the company has come a long way and has been indispensable to the growth of India’s investment management industry.
In the non-tech segment —
Specialty chemicals maker Chemcon saw its IPO oversubscribed by 149 times, making it one of the most oversubscribed bids in the last 5 years. Markets are now embracing for blowout runs on day 1.
What lies ahead —
With the mood set right, some of the other most awaited IPOs, specifically UTI asset management and Burger King India (the entity that manages the US chain’s India operations) are looking at a warm welcome in the markets when bids open in the coming weeks. Save up that salary peeps!
Departing from Motown, India 🏍️
At a time when consumer spending has contracted to record levels, and demand for automobiles has dropped considerably, nobody is crazy enough to buy flashy motorcycles that cost an arm and a leg. So Harley Davidson has decided to halt its sales and manufacturing operations in India, coiling back from the death blow it was handed down by COVID-19.
For Harley’s sake, they tried hard. But India is a value market and it's hard to scale a luxury only brand here. Last year, Harley managed to sell barely 2,500 bikes, down about 22% on the year. Almost 65% of the sales came from cheaper, 750cc bikes. Not ideal for the company that makes most of its money from fancy models and associated branded merchandise.
The mandate to cut poor performing international markets had been put into motion during the August quarter results. Here on out the company will divert its resources to focus more narrowly on its domestic US demand, regularly exiting international markets that make no sense.
Check this — in 10 years in India, Harley sold 25,000 bikes, the same volume it sells in the US in 3 months. Doesn’t take a rocket scientist to figure this out!
What’s cooking in Startupland? 👀
One of India’s most promising space-tech ventures, Pixxel, has signed an agreement with in-space satellite transportation and infrastructure company Momentus, to launch its second satellite into space. The launch will be powered by SpaceX’s Falcon9 rocket next year.
Pixxel had recently secured $5 million in a seed round led by Blume Venture and Lightspeed and appears to be putting the dough to good use. Their first satellite is set to go onboard Russia’s Soyuz rocket this November, while the second satellite is set to be placed in sun-synchronous orbit in 2022.
The company is looking to build a constellation of earth imaging sats capable of delivery value for agriculture, climate change, forestry and other applications. Bravo!
Turning our heads to ecommerce —
Hopscotch, a kids lifestyle brand that runs an ecommerce marketplace for children, has scooped up $25 million from Eduardo Saverin, Lionrock capital, RPG capital etc.
Specialized marketplaces are gaining significant traction, thanks to pandemic related digital tailwinds. Hopscotch, which initially began as an importing platform, focused on the children segment after noticing no Indian made brand was interested in capturing this space. Now thanks to the pandemic, the company is even able to turn EBITDA profit.
While talking about pandemic’s impact — 🖥️
WeWork has apparently decided to sell control of its Chinese division to an existing investor Trustbridge Partners, as it steps back from an increasingly competitive market. Changing political winds between the US and China can’t be ruled out as a possible factor that may have forced WeWorks hands.
Michael Jiang of Trustbridge Partners will serve as WeWork China's acting chief executive officer. In India however, WeWork plans to keep expanding once economic recovery begins.
Tweet of the day -
Building for GenZ is increasingly becoming important. There are plenty of insights here that may come handy for you.
What else are we snackin’ 🍿
🖥️ IT empowering Bharath - IT services firm Zensar has extended its current work from home policy and is expecting to have about 25-30% workforce remote in the future. Running a pilot, the company has hired some 100 people in small towns of India to see if the model works.
💪 Rakuten’s ambitions - Tech Mahindra has sold its entire stake in Altiostar Networks to Rakuten for $45 million making it a majority shareholder in the radio access network (RAN) technology firm. Rakuten is using the technology to build its next-generation wireless carrier.
😷 Where do we stand - India reported 86,508 new COVID-19 cases on Thursday. With the latest spike active cases stand at 9,66,382 with the death toll rising upto 91,149 in the last 24 hours.
🔌 Only electric cars in California - In a bid to reduce climate warming emissions from automobiles, the US state of California is planning to ban the sale of new gasoline powered passenger cars and trucks starting in 2035. Twitter cheered the bold action.
😐 Thai’s have had enough - Thailand has begun taking legal action against FB and Twitter for ignoring requests to takedown content. This is the first time the nation has taken legal action against platforms by using the computer crimes act for not complying with court orders.
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