Repurposing banks
Stimulus hopes, Crypto alternatives rising, and Women in power
Hi 👋, Tanvi here.
Filter Coffee hits your inbox every morning with notable tech and business news scoops to jump start your day.
Sign up below for free. 👇
Let’s go ahead and get started:
Market summary: 📊
Tuesday turned out a dud with India ending flat. US has another mixed session where traditional companies were pulled back an inch, while growth tech was favored.
US:
S&P 500 - down 0.21%
Nasdaq - up 0.12%
India:
Nifty 50 - up 0.071%
Sensex - down 0.028%
What’s brewing hot? ☕
✅ Serving with flexibility—rise of remote work has added massive flexibility to how millennials live, work, and travel, and Airbnb wants to make the most of that broad shift. CEO Brian Chesky announced a bunch of features yesterday that makes the platform more flexible to emerging behaviors, including “skipping” dates when booking (take me away for a weekend in June…), long term rentals, and other choices. The optionality at the company’s disposal to disrupt not just vacation rentals, but the broader real estate market is truly intriguing.
✅ Gonna see some govt. checks—Bloomberg says GOI is cooking up a fresh stimulus package as a painkiller for the worst hit sectors in the second wave—particularly travel, hospitality, aviation, and small businesses. Details are still scant, but it's hard to keep hopes too high when the government's own coffers are running dry due to the broad economic paralysis, which makes us think direct checks may be wishful thinking and instead more tax breaks is what we’re gonna get.
Softbank pulls out another one 🃏
What happened—yesterday, Softback handed a $250 million check to billionaire Bhavin Turakhia’s banking-as-a-service platform Zeta, making it a unicorn overnight.
We’d written about the impending deal a while back, but to remind you, Zeta basically delivers a sleeker, modern, software application that integrates with the core of legacy-banking systems, helps banks deliver better digital experiences to customers, while at the same time working on the other hand with startups looking to plug into a bank’s SDK’s and infrastructure to issue modern debit, credit, and prepaid products.
So far, the company’s made just $10 million in revenues for its 6 years of existence, which makes the $1.45 billion valuation rather questionable—but we’re guessing Softbank is counting on the banking relationships and partnerships the company has built, which in itself is a feat, considering how slow moving, opaque, and unfriendly banking ops can be in India.
Big picture—banks are slowly transforming into giant regulatory black boxes very good at just 1 thing—understanding and working with the law. Startups meanwhile will emerge to disrupt consumer relationships, customer support, product innovation (loans, investing, etc.) and the opportunity for platforms like Zeta to form the glue between the two factions is extremely promising.
Teaching Twitter some “desi policing” 🙄
What happened—Delhi Police visited two major offices of the India operations of Twitter, to “seek rationale” on why the company labeled a tweet by a certain politician of the ruling party as “manipulated media”.
Cops claim they visited the premises to merely “serve notice of inquiry”, but an hour-long search of the premises, with a bunch of TV cameras trailing is… not exactly how notices are served. The unsettling show of power was clearly meant to rattle Twitter into compliance.
The move kinda backfired though, because well, nobody told Delhi Police about work from home... 🤷♀️
Big picture—GOI’s recently proposed IT Rules 2021 goes into effect midnight on May 26, which among many other things, demands that social platforms appoint a dedicated compliance officer and more willingly comply with random government demands on what stays online and what gets taken down, or get banned. Rumors quickly caught speed that Twitter may be eyeing a TikTok like fate.
What matters—there’s sufficient rancor being built between US tech platforms and GOI, over sharing of data and control, but it's super unlikely that Twitter or any other service could get banned without it spiraling into a bilateral mishap, souring the relationship with the US. Good theater, but likely just bark.
Crypto, packaged for environmentalists 🧐
While Bitcoin takes a beating for being anti-climate, given the massive mining facilities that need to run to keep the network going, an alternative is growing in the shadows.
Blockchain project Chia Network raised $61 million from big name VC funds including Andreessen Horowitz, Richmond Global Ventures and angel Naval Ravikant, at a $500 million valuation, to build a currency that meets the “ESG” standards of institutional buyers.
Founded by the creator of BitTorrent, Bram Cohen, Chia basically uses hard drives for storing and mining crypto instead of heavy computers, thereby needing much less active power, delivering enhanced energy efficiency.
Fresh capital and legitimacy will be put to accelerate hiring, building products for a government offering, while already prepping for a soon to come IPO.
Closing out—Vimeo goes public 👏
YouTube’s forgotten competitor, Vimeo, which basically started the same route, making it easy to share videos online, but then made a B2B pivot helping SMEs and large corporations make employee training vids, product demos, etc., without ads, went public yesterday.
Although Vimeo isn’t a YouTube sized behemoth, it's a sizable business churning nearly $300 million in revenues each year, growing more than 50% each year, with nearly 1.5 million+ paid users across enterprises of all sizes.
Best part? The company is led by the 37 year old Anjali Sud, who joins the rare group of Indian American woman CEOs to ever take a company public.
What else are we snackin’ 🍿
💪Expanding the team - Flipkart apparently hired 23K people over the past 3 months as COVID exploded demand for e-commerce services. Will open five fulfillment centers in the next 3 to ensure faster grocery delivery.
🤝 Sealing the deal - online pharma player PharmEasy acquired rival Medlife as cash strapped independent platforms continue to fold their hands amidst heavy competition from giants Flipkart, Amazon, and Jio.
Hit that 💚 if you liked today’s issue.
You can forward this email or share FC on social media by clicking the button below. Thanks and Ciao! 😀