Nvidia’s marriage halted ✋
Cult.fit’s raise, and stuff from the week before.
Market summary: 📊
India continued to bounce all over the place, ending lower sharply on Friday. Overall, a rocky week in the US as well, with Friday sprinkling some more salt on the wound.
US:
S&P 500 - down 0.84%
Nasdaq - down 1.74%
India:
Nifty 50 - down 1.18%
Sensex - down 1.31%
Weekend caffeine injection ☕
1️⃣ Didi toast — the dragon finally spoke. Ride-hailer Didi Chuxing will be packing bags from the US, delisting itself from New York, and preparing for a listing back home in Hong Kong. All in the guise of data security, but what’s really happening is the Chinese states’ muscling of its tech giants and the western capital that arms them to dream free. Didi investors will be billions in the hole.
2️⃣ Gig switch — Gita Gopinath isn’t leaving the IMF after all. After stepping down as the Chief Economist, she will return to a deputy managing director role at the org, replacing outgoing MD Geoffrey Okamoto.
Nvidia won’t get ARM ✋
What happened — after almost a year reviewing the deal, the Federal Trade Commission (foremost business regulator in the US) has decided to take legal action and block Nvidia’s $75 billion acquisition of ARM — claiming the deal majorly anti-competitive.
So a quick refresher… Nvidia recently found big success selling its GPUs (graphic cards) as AI-processors in large data-centers (just look at that stock move). Now NVDA’s Jensen Huang, an ambitious founder-CEO, thought buying out a low-cost CPU maker like ARM would nicely round off his GPU business with the complete tech needed to build end-to-end data-center computing platforms suitable for a data-heavy computing future.
More importantly, they could potentially displace Intel, who for decades has been the king of datacenter processors, but now suffers from R&D and manufacturing problems.
FTC’s concerns — FTC saw through the grand scheme, and said a merger would give Nvidia too much power in the market, and stifle competition. ARM chips are widely used in smartphones (95% of smartphones worldwide), defense, and everyday electronics, from Apple to Qualcomm to Lockheed Martin. For NVDA to control all that?
What now — all regulators from UK to Europe have opposed the deal. Nvidia would likely appeal, but given how long this has been dragging for, better off walking away and not antagonizing regulators more.
Big picture — failure of the deal could be a new life to Intel, which is limping to its deathbed.
Big money talks — who got the bag? 💰
Curefit, which runs multiple health and fitness services, closed a $145 million round from Zomato, SF-based South Park Commons, and others — at a $1.5 billion valuation.
Curefit runs offline fitness centers as well as virtual fitness classes, in addition to a mental-fitness platform (mindfit), and even primary care services, all reaching more than 2 million users. FYI, the company’s recently launched Peloton look-alike bike for India is making quite the buzz as well. 🤞
Then looking at a quick Metaverse deal,
Softbank invested $150 million in Zepeto, a Korean immersive-social play that's building a metaverse-experience for Asia.
Zepeto currently focuses on e-commerce use cases, allowing users to try and buy clothes in the virtual world, with top celebrities pitching wares. ~2 million people use the platform everyday, with fashion labels like Ralph Lauren and Gucci onboard. Shit getting real, fast!
Aight peeps, that’s all we have for today! Quick look at major stuff that went down this week…
🐦 Twitter got a new CEO — Jack Dorsey is quitting the business, after 16 long years at the company he founded, ending a 6 year-long tumultuous term as CEO. Indian born, IIT bred, Stanford PhD and Twitter-CTO Parag Agrawal took control of the ship. Jack had long-brewing problems with Twitter shareholders, caused by slow growth, poor monetization, over-policing, and divided attention at Jack’s other job as the CEO of the $100B payments giant Square. India rejoiced in Parag's new gig!
📱 PayTM tries to come back — the company reported a pretty decent second quarter, hoping that takes some pressure off of its stock. Revenues jumped a solid 69% YoY to ₹1,086 crores, while losses were contained, and momentum in non-payments businesses looked solid. Reopenings of travel, movie theatres, as well as emerging products in lending, BNPL, helped the growth numbers. Management deserves some points! ✌️
💪 ITC’s direct-to-consumer acquisition — ITC is acquiring a 16% stake in a homegrown personal care brand called Mother Sparsh, for ₹20 crores. The 5-year old business sells ayurvedic skin & hair care products for babies and new mothers, making some ₹15 crores in revenues a year. They can now leverage ITC’s extensive distribution network from malls-to-tapris in India to push their wares more broadly.
🧐 Snapdeal is going to test out DStreet — grand-daddy of Indian ecommerce is cleaning house to raise $250 million from the public market, at a ~$1.5 billion valuation, sometime early 2022.
The decades-old empire is picking some steam from COVID’s tailwind to e-commerce with ₹815 crores in revenues for the COVID year, but losses at ~₹200 crores net-net have stubbornly followed. Gonna be a tough sell with the market, but that’s why the valuation is so modest.
💰 Zomato launched an investor portal — a fundraising platform that will connect emerging food ventures with potential big-money investors, that’s Zomato’s idea to add more value to its ecosystem. Stats suggest barely 25-or-so food-ventures or cloud-kitchens, with a reasonably scalable model, have ever raised a Series A or later round. $ZOMATO will also apparently play a role of helping founders get their “story” right.
✈️ Jet placed a big order — in the hands of new owners and plotting an early-2022 comeback, Jet Airways is talking to Boeing and Airbus to buy 100+ planes for its new fleet, in a deal worth $12 billion! Post-bankruptcy, Jet is left with a tiny fleet of just 11 planes, most of which are old, in need of upgrades. Selling those off and starting afresh is a good bet. Jet had an old order placed with Airbus back in 18-19, which will now be revived.
💳 CRED buys out Happay — CRED acquired enterprise expense management platform, Happay, dipping toes into the B2B financial-software world. Happay’s SaaS tools help employees submit their corporate expenses bills, and for companies to track spending, along with integrations into accounting, HR, banking and other functions. CRED could tightly bundle Happay users with its consumer platform to give them points (and linked deals) for corporate expenses.
◼️ Square became Block — day after cleaning out his desk at Twitter, Jack Dorsey pulled off a Meta-like change at his payments company, renaming Square as “Block” — a holding company that will own Square and its multiple payments + bitcoin + music products, which will collectively focus on building decentralized products on the Bitcoin blockchain.
And then quick look at a mega raise: ☝️
Credit-card startup Slice, became India’s 41st unicorn of the year, after raising $220 million for its Series B from Tiger Global and Insight Partners. The $27-limit credit card has been a mega hit.
Hit that 💚 if you liked today’s issue.
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