Crypto heat 🔥

Hot SPAC closure, roasting NFLX, and Apple’s event.

Sep 16, 2020

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: 📊

Indian markets made a decent comeback Tuesday after a soft opening earlier in the week. For the US markets, it was another positive day, with things looking bright so far for the remainder of the week.

US:

S&P 500 - up 0.52%
Nasdaq 100 - up 1.43%

India:

Nifty 50 - up 0.71%
Sensex - up 0.74%

What’s out from the Apple stable?

Apple’s annual product launch event yesterday was uniquely exciting — the company did not launch any phones but blew fans away with a new Watch that’s capable of reading blood oxygen levels and a new A14 processor built with 11.8 billion transistors! 😱

Some highlights —

Launched 2 watches - a series 6 and a cheaper SE
2 new iPads - an 8th Gen and an iPad Air
A massive push into healthcare with Watches and a Fitness bundle
Revamped subscription bundle of services
iOS 14 dropping tomorrow

The launch made one thing clear — Apple believes healthcare is a critical next frontier of innovation for the company, one that would appeal to its ageing millennial and boomer user base. Here's all the stuff the company launched if you’re looking to nerd out.

Gut punch to crypto-bros 👊

Just as things were starting to look better for the nascent yet thriving crypto ecosystem in India, Bloomberg dropped a bomb last night that the government is conducting cabinet discussions to impose a blanket crypto trading ban in India. SMH.

Sure the crypto revolution, catalyzed in the aftermath of the global financial crisis of 2008, unequivocally challenged and even antagonized global governance and fiscal policies but other peer nations as well as developed economies never felt this threatened and instead worked hard to put in place regulations to let innovation continue in this space. India’s negative outlook, if true, is weirdly counter to everybody else.

Anyway, news suggests a fresh bill banning trading is in the works, which will be discussed by the cabinet before it is sent to the parliament for a vote. Apparently, the government “encourages” pursuit of Blockchain but wants to put a stop to trading (which also means no retail crypto currency ownership allowed). Here’s more.

Bottomline: the sentiment that crypto trading could harm unassuming investors is perhaps true but wayyyyyy blown out of proportion. Instead of thwarting innovation in an arena that continues to captivate the minds of some of India’s best, the government should spend resources on perhaps educating those that are most vulnerable to scamming. It's a terrible call.

Fundraising roundup 💰

Fintech had a great day yesterday when Swedish payments provider Klarna Bank AB raised $650 million at a valuation of $10.7 billion from big bracket investors led by Silver Lake.

Klarna is part of a band of buy-now-pay-later disruptors that are mushrooming around the world, growing at alarming rates. Affirm (by Paypal mafia Max Levchin) and Australia's AfterPay are key contenders globally in this space, while countless small players in India play in this arena as well. The raise nearly doubles Klarna’s valuation and will offer it valuable firepower to compete worldwide.

In Indian fintech -

Leading cashback and coupon site, Cashkaro, has secured $10 million in Series B funding round led by Korea Investment Partners (KIP) and existing investor Kalaari Capital.

Winning from India’s digital commerce boom, Cashkaro has launched some new complementary products including a price comparison service, and a social commerce app EarnKaro which gives cashbacks for referrals. Within 18 months EarnKaro has garnered about one million registered users and the funds will be put to expansion there.

Key takeaway: can’t help but notice how social commerce is rapidly gaining popularity. Recommendations from friends and family are viewed more credible than ads. Every big tech company (FB, GOOGL) is riding this wave in one form or another and some Indian companies including Meesho, BulBul, SimSim, and now CashKaro are having trail-blazing success.

Moving on,

Virtual event organisation platform Airmeet has raised $12 million Series A funding led by Sequoia Capital India and Redpoint Ventures. Notable angels like Gokul Rajaram also participated in the round.

The new round values Airmeet at about $50 million, a 100% premium to its valuation barely 6 months ago. Basically a beefed up Zoom for live events, the platform allows users and businesses to host interactive virtual events, with features to mimic elements of a physical event such as — a backstage, grouping people to a table, allowing member networking etc. and even facilitates sponsorship. World we live in!

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Come on!

Netflix is getting hammered in the press worldwide, and perhaps rightly so, for releasing a controversial movie titled “Cuties” which viewers allege encourages voyeurism and sexualizes children.

Some backstory: the movie “Cuties” actually won accolades at Sundance, including an award for directing. It tells a story of a young girl in poor Paris suburbs who apparently finds her freedom through a dance trope. Anyway, without delving into the plot, the movie has scenes that critics, viewers and everyone with a sane mind believes depicts kids in the wrong light.

On the other side, Netflix and the creator of the movie's defense says that 1. Freedom of expression yada yada and 2. The creator of the movie (a female) is actually telling her life story through the movie. Which is actually a plausible reason to not have the work blocked.

Consequences: we won’t play judge here but the western world seems livid with Netflix’s inaction. A massive #cancelNetflix campaign is already in motion and the company is losing subscribers at an alarming rate. Early reports suggest churn rates at “multi-year” high rates. Not just that, the US congress is gathering lawmaker support to reprimand Netflix and get the movie forcibly taken down.

Opendoor finally closes door on IPO 🚪

The hot real estate startup from the valley finally agreed to merge with Social Capital II, an SPAC from the legendary Chamath Palihapitiya, that will take OpenDoor public. The deal is valued at $4.8 billion.

Chamath outlined his investing memo here, which is quite a read. We also wrote about why SPAC’s are increasingly getting attention as credible alternatives for traditional IPOs.

Each year in the US alone 5 million+ homes are bought and sold. Globally that number will easily be over 50 million at least. Despite this being a trillion dollar market rife with inefficiencies, residential real estate has seen little disruption world wide. Opendoor was a fresh breath in the space — basically assuming all risk by buying homes itself within a few weeks, and then selling it to buyers on the other side in record times. Cutting middle parties and saving thousands of dollars is its value proposition.

Naturally, this is a gigantic market and it will take the company time to build a credible business. The SPAC deal gives it valuable cash infusion, without the constant media nagging or scrutiny of the public stock markets.

What else are we snackin’ 🍿

🛒 Employment Gods - After Amazon announced its plans of hiring 1 lakh new workers, Flipkart revealed similar plans of generating around 70,000 jobs such as delivery executives, pickers, packers and sorters to gear up for the upcoming big billion days.

🎵 Smitten by the Tok - finally giving into temptation, YouTube will launch a short video app called “Shorts” starting with an early beta version in India. YouTube has been aggressively looking to find new avenues of monetization for its video service.

🏏 Yup, we got IPL - South Asian online video streaming platform YuppTV has acquired the rights for the IPL 2020 for a total of 60 matches. The OTT has signed a deal with Star India for live telecast of the matches in more than 10 international markets.

🛵 EV milestone - Electric vehicle startup PURE-EV, which is incubated by IIT Hyderabad, will launch its premium model scooter in Nepal by October 2020. The startup is currently looking for good distribution partners to help bring the vehicle more widely in other target markets. EV innovation coming out of India is slowly showing a lot of promise.

🎮 Batting for PayTM - Paytm’s gaming arm has announced Sachin Tendulkar as its brand ambassador. The app is essentially a fantasy gaming platform for sports such as Cricket, Basketball, Kabaddi and Football. Tendulkar’s face gives them a strong edge in gaining eyeballs.