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Market summary: 📊
Okayish day for the Indian markets yesterday, with over-valuation concerns holding investors back a bit. US gave away some gains but a stimulus announcement could send the markets rallying.
US:
S&P 500 - down 0.38%
Nasdaq 100 - down 0.58%
India:
Nifty 50 - up 0.21%
Sensex - up 0.19%
What’s hot? ☕
✅ How them tables have turned bruh—India’s looking at supplying close neighbors including Afghanistan, Mauritius, Nepal, Sri Lanka, Bangladesh and a few others indigenously manufactured vaccines. Close to 20 million vials will be packed off and sent out pretty soon, of course after ensuring enough doses are being distributed locally too. From being on the receiving end of charity, to the other end, we’ve come a long way and the capitalist stakeholders who’ve made this possible deserve a pat on the back.
✅ Auto sellers had a mixed month—car orders for the month of December held up pretty strong, with orders up 13.6%. The dealers are basically hoping that pent up demand from earlier in the year will continue to remain strong, and that more consumers will rush to buy a car right now, with a looming auto price hike on the horizon.
This was the 5th straight month of growth, so yeah, we’re recovering okay. But India’s auto market had a terrible few months in March, April, and June, and analysts say the total volumes we are seeing on a full year basis puts 2020 at a 10-year low.
Global VCs had a good year too 📈
It wasn’t just stonks that had an epic 2020—while the first quarter and the second quarter took some momentum away, venture capitalists returned to business with a lot more fervor and chutzpah towards the end of the year, finishing the year high up relative to 2019.
Some quick stats for the year of 2020 in the VC game:
Global venture capital invested up 4% in 2020, to just over $300 billion
Deal count however was lower than last year
Late stage ventures got most of the $$ meant for startups in 2020
41 startups got sold for over $1B—a record
And there’s many more interesting charts in this crunchbase article. The Angel and Early Stage investment landscape held steady relative to the last year, which is kinda awesome, especially when we consider how previous recession years have been slump-times for the VC business.
But this time is definitely unique—there is a broad mandate for the digitization of this world, which is tilting the scale disproportionately in the favor of technology-first businesses, and secondly with interest rates at record low, there’s a lot more capital relatively easily accessible. In short, best time to pitch investors if you’re building something.
Crypto tide hits Indian shores 💰
CoinSwitch Kuber, a crypto investment platform in India raised $15 million from global fintech investor Ribbit Capital and crypto-fund Paradigm, for its Series A round. Existing investors, Sequoia Capital India and Kunal Shah pitched in too.
Ribbit actively invests in the fintech game worldwide, and this deal books their first investment in India. So does for Paradigm, which is founded by one of Coinbase’s founders. Coinswitch, which started 3 years ago as an aggregator of crypto exchanges across the world, recently launched the Kuber platform targeted at the avg. Indian investor.
The team claims “millions'' of users right now, and hopes to scale to 10 million by next year’s end. Fresh funds will fuel upgrades in tech, product functionality, and security.
And while we’re on cap raises,
Elon Musk is handing over $5 million to Khan Academy, the online edtech platform, that apparently runs like a non-profitable organization (we had no clue). Good on Musk for pitching in, and it probably didn’t take a lot of convincing given our man started 2021 on a roll—clinching the richest man title, beating 2020 Tesla car deliveries by a mile, and announcing an Indian launch to much fanfare.
FYI—the Musk Foundation, which Elon runs with his brother Kimbal, has raised over $257 million and is a big giver to organizations around Education, renewable energy space research, human space exploration research, and the creation of safe AI tech for humanity.
On the other hand, one can't stop admiring Khan Academy either. The company kinda had the same ramp to glory as Bjyu’s, using a teacher-founder’s hustle as a hook to turn it into something much bigger. One went a particular route, the other complete opposite.
120 million people worldwide rely on the platform, with ~30 million using it each month.
Max Levchin, the O.G. 🙌
PayPal co-founder Max Levchin took his second fintech startup, Affirm, to a blockbuster IPO yesterday, as investors gobbled up as much stock as they could find their hands on, taking prices up nearly 125% by the end of the second day. Routine Thursday in stonks.
Affirm essentially pioneered the Buy-Now-Pay-Later model, allowing digital platforms to give consumers the option to buy something on the internet but pay later in parts without paying an eye and a nut for fees! Merchants were happy because it helps them convert consumers who may be particularly shy in buying high-ticket items online.
The UI was seamless, and within a few minutes consumers would be able to enter their information, secure a line of credit, and then checkout with just 1 click during repeat transactions. Affirm makes money by charging merchants a small fee, and then from late fees, penalties and such on the other end.
Riding the ecommerce boom, the company grew exponentially:
2020 revenues of $500M+, up 93%
4 million users
Total volume of transactions is at $4.6 billion, up 77%
They’re profitable too
As of today, the market cap now stands at $25 billion. What a year fintech has had!
Fun fact: Affirm threw some analysts off when it was reported the company makes nearly 30% of its revenue from just one company—Peloton, the health-tech platform selling $3,000 exercise bikes, and now looking to take on Apple.
UBS warming up to fintech in India 💳
UBS group is in pulling some backers and cobbling up a nice $400 million pot to hand it over to PayTM—marking a huge vote of confidence in the Indian ecosystem. No valuation has been discussed, but given how hot the global fintech game is right now, expect to be surprised.
The passion, vigor, and conviction with which big money managers are coming after startups in India is unprecedented. Not always, but UBS mostly serves big old money elites, the ones just looking to park their capital in places where it's safe for generations. Their bet on India speaks volumes about how the global sentiment is generally shaping up for the growth markets here.
What matters: late stage ventures gotta take those IPOs seriously now, and let the average investors ride out and build some wealth through this explosive growth phase for India.
What else are we snackin’ 🍿
💻 Voot voot - OTT platform Voot has bagged streaming rights for Poker Sports League (PSL). The league will hold its tournament online as the pandemic has disrupted the physical tournament.
👏 Another defence tech contract is through - The Indian Army has signed a pact to buy high altitude drones from an IITB incubated startup ideaForge, for $20 million. The company emerged as the only vendor capable of meeting the qualified operational requirements in an evaluation done in real-world conditions.
Hit that 💚 if you liked today’s issue.
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