Sensex victory 🙌
Payments boost, and recap of the week.
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Market summary: 📊
It's done! Investors conquered peak 45K for Sensex, marking a resounding victory for Indian markets recovering from the pandemic. Fact that this has been achieved with little stimulus from the government makes it all the more exciting. US markets had a decent day too.
US:
S&P 500 - up 0.88%
Nasdaq 100 - up 0.49%
India:
Nifty 50 - up 0.95%
Sensex - up 1.00%
👋 Hey—easy news day last night so we thought of trying out a slightly different format with the Saturday email. Sometimes a lot of the news and commentary gets lost between the noise, so we’re relinking the most important news from the week before, with small commentary around it to help you refresh ideas. If you happen to passionately like it or HATE IT, do me a favor and let me know by just responding to this email—otherwise I am assuming you’re onboard :)
If it's a success and I don’t get too many emails calling a no-go, we’d adopt this format for every Saturday. THANK YOU!! 🤝
Recurring payments get a boost 💰
RBI yesterday revised the limit on auto-pay via UPI and contactless card payments to ₹5,000 from ₹2,000 per transaction. Basically, platforms will be able to automatically process transactions of upto ₹5,000 without seeking authorization from the user—a blessing for those ventures particularly building products and offering services around recurring payments involving EMIs, monthly investments, bill payments etc.
The bump up to ₹5K may seem very modest to some but apparently that covers majority of the credit card transactions going through as of date (see below). Expect a ton of startups, product features, and ideas mushrooming just in the aftermath of this move, which goes into effect on the first day of next year.
Then, refreshers from the week before
🎮 Discord doubling valuation to $7B—
Riding the post COVID explosion in gaming, Discord is raising a fresh pre-IPO round targeting a $7 billion valuation. Barely 3 months ago, the communications platform for gamers had raised $100 million at almost half the valuation. Discord had about 300 million registered users in June, and has been consistently doubling that number each year for almost 2 years now. With gaming set for further boost with AR, virtual currencies, and other structural changes in a few years, prospects have never been brighter.
💳CRED raised $80M—
Winning huge from a successful IPL marketing campaign, CRED cashed in an $80 million Series C check from DST Global, Ribbit Capital, Sequoia, and Tiger Global to further scale up assault in the fintech arena. Valuation now stands at $800 million—a 77% bump from the $450 million levels the company had raised at just last year. Despite the artificial barriers, they managed to pool an impressive 3M highly credible, high-income users that traditional banks can only dream of ever segmenting. More products are inevitable.
💰Salesforce buys out Slack for $28B—
Salesforce finally disclosed commitment to buy Slack for $27.7 billion—nearly a 70% premium to Slack’s market cap before rumours of the transaction broke out about 2 weeks ago. For Salesforce, owning slack essentially gives them access to perennial engagement from 12 million corporate employees via a “homepage” application where developers, business folks—literally everyone hangs out to get shit done, sharing files, searching docs, cracking dad jokes all the time. Salesforce will look to seamlessly sell them more cloud tools there. Also, Microsoft Teams had left them little choice but to take a shot.
💰Tata looking to buy 80% of BigBasket—
Tata is close to pulling the trigger on BigBasket, looking to acquire 80% of the online grocer for $1.2 billion, revising the valuation of BigBasket to $1.6 billion—a 33% premium. This transaction is phenomenal for everyone involved. BigBasket gets a resourceful, cash rich partner to keep fighting competition, while the Tata empire gets to dip its toes into the digital world at a relatively lower cost, before they go full speed with their super-app ambitions.
🗣️Facebook moves into SaaS tools, doubling down on commerce—
Facebook acquired Kustomer for $1 billion. The company sells a customer support platform that allows merchants to communicate with users across channels including email, text, FB messenger, and other medium, leveraging the power of AI to cross sell, up sell and handle basic queries without getting an agent involved until absolutely necessary. The move is part of FB’s broader strategy to monetize the social commerce opportunity at its disposal, and it appears they’re taking a unique angle combining earning commissions on a marketplace along with recurring income via SaaS tools. Watch out for more.
📱PhonePe spun off, and raised $700M—
Walmart has finally gotten Flipkart to spin off PhonePe into a separate entity, infusing $700 million into the new company in a fresh raise, and slapping a $5.5 billion valuation tag on it. Post spin-off, Flipkart’s ownership of PhonePe comes down to 87%, while 10% will be owned by Walmart and rest of the 3% will be shared between other investors who pitched in. PhonePe CEO claims the move will make the company more effective, giving the company the independence as well as the cash to pursue long-term vision without intervention. Walmart’s intention to cash in on some of its investment in India via an IPO could be the fundamental driver behind the move.
🕯️ Lastly, legends passed away—
Firstly Tony Hsieh, the founder and ex-CEO of Zappos, passed away due to injuries faced from a tragic house fire. Tony was known for scaling an ecommerce platform for footwear and then selling it to Amazon for nearly $1.2 billion in 2009. He was also well regarded for his vision, an empathetic approach to business, and his stubborn effort to focus on delighting the customer.
Then the world lost Dharampal Gulati, an Indian icon who shaped up the spice industry like no one before, turning MDH into a global behemoth that brings in hundreds of millions of dollars in revenues. He was 98. RIP.
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