Hold that no code ✋
Edtech is bacc, Robinhood slammed, and Sam wants your eye.
Hi 👋, Tanvi here.
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Market summary: 📊
Indian markets posted 3 days down in a row, which is now starting to hurt a bit. US had a mixed day too, with Wall Street’s growth tech rally running out of fizz midweek.
US:
S&P 500 - up 0.13%
Nasdaq - down 0.12%
India:
Nifty 50 - down 0.17%
Sensex - down 0.13%
What’s brewing hot ? ☕
✅ Racing to pole — Formula 1 signed a $100 million, 5 year sponsorship deal with crypto exchange and platform Crypto.com, which will see Crypto.com present in all F1 events, trackside advertisements in races, and be the NFT partner of the Belgian Grand Prix. Post the widely watched Netflix series, F1 has found itself passionately pulled into mainstream pop culture, and the league is making the most of its popularity to expand eyeballs.
✅ Spanked — Robhinhood was slammed with a $70 million fine by market regulator FINRA to settle legal charges for failure of supervision of chaos on its app as well as routine outages in its option trading service, all of which led to average users holding the bag and collectively losing millions of dollars over the past 12 months! $57M will go to regulators, while $13M will be paid in reparations to the clients.
Another sleepy news day, let’s run through the important stuff real quick…
Microsoft bets on dev automation 😎
What happened — Microsoft is building a developer tool for Github that will use artificial intelligence to auto generate blocks of software code, as a way to help programmers improve throughput and become more productive.
Big problem — developers routinely spend gazillion hours of time writing the same logic that has been written a million times before, and many times easily found on Github or on online Q&A forums like Stack Overflow. If basic AI could somehow pool all this knowledge together and deliver “blocks” of a program before a programmer goes fishing for it, the resource savings could be massive.
Anyway, Microsoft is joining hands with OpenAI, the guys behind the GPT-3 language model for this project, and the tool will be called Github Copilot.
Bottomline — Microsoft owns Github, is an active investor in OpenAI, AND has distribution into millions of enterprise software customers, which makes it THE best player to deliver, scale, and monetize a solution like this as fast as possible. Reminder of Nadella’s genius!
Big picture — developer productivity is a massive bottleneck for global enterprises, if rightly done, potentially a hundred billion market in terms of wage savings.
Quick look down Venture Street 💰
What happened — BLR based edtech platform Quizizz raised a $31.5 million Series B round at a $300 million valuation from Tiger Global and a few others.
Quizizz offers a platform for K-12 school teachers to create, share, and discover interactive quizzes and lessons, to make monotonous learning a bit more immersive. With 20M+ quizzes, accessed by 60M users each month, across 120+ nations — it's a pretty legit service.
Fresh capital will now be put towards expanding operations in India, US, and a few key foreign markets.
Big picture — 1.0 edtech gave us an online version of a classroom (Khan, Byju’s, Coursera). 2.0 edtech will lean heavily on gamification and immersive tools to make things fun.
While we’re here,
ET is reporting that digital insurance giant Acko is raising $200 million from General Atlantic, Warburg Pincus, and others, at a billion dollar valuation — more than doubling its last known valuation.
Acko, which sells motor and health insurance, has sold 50M+ policies so far, thanks to India’s accelerated consumption of insurance services in the aftermath of COVID, and is now projecting premiums to top $175 million by end of year.
Quick updates from the local markets 📋
Most conservative investors are busy assessing the scope of blowback from the economic carnage of the past 2 months. Here’s what’s running across their desks…
Ratings agency S&P, which basically tells institutional investors how well the economy is functioning, reiterated systemic risks to Indian banks. S&P suggests banks will struggle with 11 to 12% of all assets as weak loans (kinda high, but not ridiculous yet), while losses from bad lending should spike to 2%+ of the loan book for 1-2 years. Gotta make serious investors a bit nervous.
Meanwhile, GOI finds itself in a much better footing financially vs. same time last year, with revenues rolling in from sell off of public sector companies and RBI’s support, helping keep fiscal deficits under control, even as tax revenues somewhat lag. This means GOI will be in a much better position to hand out more doles down the line, if economic carnage doesn’t end soon.
Big picture — long term, most of the hiccups will iron out, but hard to see the markets fall in love with “financial services” stocks in the short run, no matter how attractive the bids look.
Closing out — Silicon Valley’s crazy ambition 👁️
What happened — valley power figure and ex-YC partner Sam Altman has a new idea — to give every single person on the planet a crypto coin, if they would let Sam scan their iris to verify identity, into a globally deployed “orb-shaped" device about the size of a basketball.
The borderline dystopian project, called WorldCoin, raised $25 million from big name VCs, including a16z, and everybody just lost their shit.
Some context — although details remain scant, Sam, a long time proponent of universal basic income (free money everybody gets as dividend from automation), says this is one way of allocating resources to the mass population without incentives getting lost in the system.
Going ahead — tests are being conducted in several US cities with nearly 20+ orb shaped devices floating around town, says Bloomberg. Shit has gone too far.
What else we snackin’ 🍿
❌ No deal - Brazil will suspend its $324M contract with India’s Bharat Biotech for the purchase of 20M Covaxin doses after finding irregularities in invoices.
🙅 All lies - Reuters says data of nearly 700M LinkedIn users was found for sale on the dark web. LinkedIn says nah.
Hit that 💚 if you liked today’s issue.
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