Tata way of things
Fintech consolidation, Apple problems, and Nigeria joins Koo.
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Market summary: 📊
India resumed its upward climb after a momentary pause mid-week. US had a pretty decent session too, with tech showing good momentum.
US:
S&P 500 - up 0.47%
Nasdaq - up 0.78%
India:
Nifty 50 - up 0.65%
Sensex - up 0.69%
Quick two shots of espresso ☕
✅ How’s that transformation going?—GameStop is slowly getting its act together, reporting a growth quarter in a long long time with revenues up 25% YoY. There’s plenty other bright spots too—ecommerce is buzzing, all debt has been paid off, and ex-Amazon Australia executive Matt Furlong has been hired as CEO to clean things up. The joke might just become a serious business if things keep up.
✅ Ransomware keeps coming—Brazilian corporation JBS, which runs one of the largest meat processing companies in the world, apparently paid $11 million in ransom last week to stop a cyber attack that threatened to shut down company’s operation, just like the high-profile attack that took down the Colonial pipeline. Global corporations, governments, and institutions are running shit scared about this new pandemic.
Tata making this look too easy 💊
Tata finally moved on 1mg, buying out 55% stake in the online pharmacy, valuing it at about $450 million.
This would be Tata’s 3rd major attempt to acquire some hot property on India’s venture block (after Curefit, and BigBasket)—all 3 strategically diversified yet so synergistic.
1mg, competes with PharmEasy, as well as Reliance, Flipkart and Amazon in the online pharma races, a market which has been growing 45%+ on the back of the pandemic’s boom, estimated to attract $2.5 billion+ in spending by 2025. With a formidable cash-rich parent, 1mg can now afford to turn the heat up on its rivals.
Big picture—the precision, diversification, and breadth of ambition shown by the geriatric looking Tata empire here is truly staggering and exactly representative of why some of India’s largest businesses have survived centuries of change.
Banking as a service platform goes mainstream 🥱
What happened—payment processing and banking-as-a-service vendor Marqeta went public yesterday, with stock getting a nice 13% boost, booking a $16 billion market cap.
Some context—Marqeta started by allowing large businesses to process bulk online payments. Overtime, the platform caught the embedded fintech wave, to offer APIs for issuing debit and credit cards, filling an invaluable gap between disruptive startups and legacy financial institutions—making cool fintech end products possible.
Going forward—as of today, Marqeta has issued over 350 million debit or credit cards, to millions of Uber and DoorDash drivers, Affirm and Klarna users, and multiple other neobanking and fintechs around the world. Last quarter the business made $125 million+, at explosive 115%+ growth rates.
Bottomline—positive reception to the IPO signals the market's optimism and acceptance to these emerging businesses. Also, much better unit economics than neobanks or payment apps. Gotta go chasing on the Nasdaq tho.
Quick peek on venture street 👀
CarDekho, the online vehicle marketplace, is apparently looking to raise $150 million at a billion dollar valuation, promising investors that the market for auto-sales will strongly rebound in favor of digital.
The business, which started as a vehicle comparison website, has slowly transformed into a marketplace for used vehicles. Although India’s extremely picky vehicle consumer base has been unfriendly to used cars to date, that’s expected to slowly change as prices of new vehicles rise, and digital sellers add some transparency to the used car marketplace.
Key insight for ya—the used car market is expected to reach $70 billion by 2030—given a large population still untapped. Opportunity is bright, but unit economics, likely not.
Meanwhile, some payments consolidation
Fintech, BharatPe made a quick acquisition, buying out PayBack India, a loyalty and rewards platform for about $30 million.
Payback essentially runs a deal-aggregation platform that works with countless brands to offer points and cashback services to customers. 100 million people use the service, which made $25 million+ in revenues last year.
Closing out—the Apple “Job”🍎
Fanhouse, an only-fans like platform for non-XXX content, is taking on Apple for demanding debilitating processing fees on the App Store.
Fanhouse takes a tiny 10% cut from creators who monetize their audience on the platform, but Apple apparently has been demanding 30% instead, and has asked Fanhouse to vacate the App Store otherwise by August.
Bottomline—killing ads in the name of privacy is one thing, killing the livelihood of creators is another, and Apple’s adversaries are making the most of the “sentiment”.
Leading charge is Apple's new arch nemesis Facebook, who made events on its platform free for creators until 2024, just so it doesn’t have to pay Apple. Instagram CEO Adam Mosseri now says FB is “actively looking to make transactions happen elsewhere”. Buy some popcorn.
What else are we snackin’ 🍿
🐤 New home - Guess who joins the Koo party? Government of Nigeria. After banning Twitter in its country, Nigeria has adopted the Indian alternative, while Koo is firefighting to add local Nigerian languages ASAP. This a fight we’d pay to watch!
🌌 Blessed 10 - AWS’ space accelerator is a go with 10 startups joining this batch, including space robot makers, junk haulers, and infrastructure builders. What a way to expand TAM!
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