No stopping for Tiger 💵
Zoom firings, Alibaba moves, and edtech consolidations.
Market summary: 📊
India opened sharply lower on Monday, with Nifty cracking through 17K after almost 3 months on the other side. US had an up day though, as Omicron worries begin to recede.
US:
S&P 500 - up 1.71%
Nasdaq 100 - up 0.85%
India:
Nifty 50 - down 1.65%
Sensex - down 1.65%
What’s brewing hot? ☕
1️⃣ More dough — Tata Motors will raise the prices on its commercial vehicles starting Jan 1st, by about 2.5% — to make up for rising costs of raw materials, supply chain issues, and other production snafus that are eating up its profits. Automakers across the board are battling similar issues, and Maruti, Audi, Merc have responded with similar moves recently. $TATA should catch some wind in its sails on the news.
2️⃣ FB in hot soup — the victims of the Rohingya genocide are jointly suing Facebook for an eye popping $150 billion, for stopping to spread misinformation on its platform, and further fomenting the 2016 crisis that killed 25K+ people. A case against FB was filed with a court in California by survivors who were admitted to the US as refugees. Although US laws protect internet platforms from such liability, the group argues that because the incident happened in a region where local laws are different, Facebook qualifies for no immunity. Messy!
Ain’t no stopping for tiger 🐯
What’s poppin’ — Bizongo, a vendor and supply-chain management SaaS platform, scooped up a $110 million series D from serial-unicorn-printer Tiger Global, with a few others pitching in — at a $600 million valuation.
Bizongo’s platform (1.5 star for naming btw) allows enterprises to manage manufacturer and vendor relationships (specifically for custom, “made to order” products) via a singular portal — making it easy to place orders, manage communication, maintain paperless trail, offering both parties complete real-time visibility over the supply chain.
Data churned is also used to offer supply-chain financing and other money-services to clients. 2 million tonnes of material is processed by the platform on a monthly basis — for 1,500 manufacturers, with 120+ end clients.
Worth mentioning — Tiger has pursued atleast 7 deals worth $100M+ a pop in India since it closed its $8.8 billion new fund 2 months ago.
Meanwhile, quick look at D2C roll-ups ☝️
Mensa Brands expanded its portfolio via another acquisition — buying out Folkulture, an India based home-décor and interior furnishing label, that mostly sells to customers in the US and the UK, on Amazon.
Mensa had recently raised $135 million at a $1.3 billion valuation, going from 0 to unicorn in 6 months. Last month alone, they’ve acquired some 12 brands — aiming to top 40 brands by the end of next year.
China forces Alibaba to clean house 🧹
What happened — Alibaba is pursuing a major reorganization of its trillion-dollar ecommerce business, AND hiring a new CFO — crumbling under pressure from the Chinese government and frustrated shareholders.
Quick look at the deets:
Will form 2 new business units within — with new heads
Domestic ecommerce businesses will hold Tmall and Taobao — both local ecommerce portals
Operations like AliExpress, Alibaba.com, and other cross-border portals with customers in US, EU, will be grouped under an international business vertical.
Hard to read into the dealing behind the curtain, but possibly by dividing by geography, Alibaba is making it easy for its Chinese domestic operation to more freely share data with the CCP and Chinese regulators, while international merchants are left unbothered.
Why care — last year, Alibaba sold more than $1.2 trillion worth of stuff making it the No.1 online marketplace, far ahead of Amazon’s ~$600B.
Yet, ever since China started beating its tech giants and going after Jack Ma, $BABA stock has lost 64% of its value — shedding $500B+ in market cap. Has been a painful ride for wall street buyers, which folks hope ends now.
Zoom-firing fiasco breaks the internet 🙄
Vishal Garg, the founder-CEO of Better.com, a US based unicorn home-loans platform, fired 900 people in the US and in India (15% of the company’s workforce) over a Zoom call. Folks recorded it, and the video is now everywhere.
Startups are hard sure, but Better has raised almost $905 million from investors to date — and the actions and the way in which the message was delivered, right before Christmas holidays, aren’t really sitting well with folks.
Casualty of an industry-wide slowdown — record low interest rates, and nesting millennials drove a massive up-cycle in residential real estate market in 2020, especially in the western world.
Tech companies jumped on the opportunity, investing, spending to build tech-first experiences to lending, showing, buying etc. But then demand cooled off fast, a glut followed, and tech plays were caught with pants down.
Zillow for example recently had to lay off 25% of its workforce in iBuying.
Closing out — edtech consolidation continues 🎓
Ronnie Screwvala’s UpGrad continued its acquisition spree — buying out Talentedge, a professional upskilling platform, for ₹350 to ₹400 crores.
Talentedge, which offers certificate courses in analytics, machine learning, and other tech-heavy verticals, was on its way to do about ₹130 crores in revenues this year.
UpGrad meanwhile, which also became a unicorn this year, is executing a ~$250 million mandate to buy out smaller players in adjacent areas, strengthening its own position. This would be their 6th major acquisition in the last 12 months.
Big picture — plenty of ventures with reach and engagement, but weaker financials, are counting on take outs as the only viable option. Top platforms are expected to keep getting stronger.
What else are we Snackin’ 🍿
🛢️ Oil back at it - as Omicron fears recede, the oil market is jumping back up. Prices topped $72/barrel, in hopes that travel, production won’t skip a beat.
🕴️ Bag secured - Reliance got a green loan from HSBC, MUFG, DBS Bank and a host of other global banks to wrap up its acquisition of REC Solar.
🤝 Indo Russia catch-up - Putin is in India, clearing out a long list of items improving relationship between our two nations. 28 pacts were signed, covering state security, cybersecurity, energy and more.
Hit that 💚 if you liked today’s issue.
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