Trekking to the street 🏔️
Ukraine likes crypto, Berkshire killing it, and Airtel makes a deal.
Morning folks! 👋
Woke up in a whole new world! Social is littered with updates about the Ukraine-Rus conflict. On its face, Ukrainians seem to be holding fort better than imagined, while crippling sanctions have begun to rot the mood of the Russian aam-public.
Markets meanwhile could act weird for a couple days as Russian banks, businesses, oligarchs move $$ around to defend the bag. If the pundits are to be believed, lack of Russian money in the market (coupled with inflation, supply disruption, weak consumer, scared investor) could further tighten wallets — with effects visible from equities to venture markets. Gonna be a bumpy week ahead. Let’s hit it. 🤙
Kicking off the week hot ☕
😎 Crypto useful after all — short on arms and funds, the Ukrainian’s took to Twitter to set up a crypto wallet and start raising funds from anyone and everyone. Crypto-leaders from Vitalik to CZ retweeted their links. Within 24 hours, close to $8 million was raised through official addresses. There were scams, fake accounts trying to gain from the mess, and all the shitshow you’d expect — but a sovereign nation got the taste of the wonders of decentralized payment-mechanisms, and you can’t deny more nations are going to look at this seriously.
💸 Old man still got game — Uncle Warren released Berkshire’s financials over the weekend — obviously kicking some ass in what has otherwise been an extremely tumultuous year for us mortals. BRK grew operating earnings (basically returns the fund makes from all its investments) by 45% for the last 3 months of 2021, and by 25% for the full year. Berkshire called out 4 companies as straight homeruns, including Apple in which they own a 5.6% stake. Here’s the shareholder letter for value-nerds.
Wildcraft is trekking to an IPO 🏔️
Another hot domestic consumer story is about to hit the streets, with Moneycontrol reporting Wildcraft, which makes affordable hiking gear, backpacks, tents, knapsacks and such, is prepping for an early 2022 bid.
Quick backstory: the brand was founded in 1998 by a trio, initially focused on making tents for hardcore campers. In the last 10 years however, they slowly entered the casual/recreational hiking arena — appealing to the average guy.
In 2013, Sequoia led an $11 million round in the company. Growth really went boom when Flipkart wrote a check and paired them with Myntra’s distribution. Meanwhile, an Insta-ready generation was actively looking for great-quality & affordable gear to make those Himachal trips happen… and the rest is history!
Wildcraft today runs 2 manufacturing units in KA and Himachal, hiring about 1,000 people nationwide, selling products through 200+ of its own stores.
Financials seem great too: Wildcraft had finished FY21 (year of COVID) with about ₹1,000 crores in revenues, with ~20-25% growth rates. During the pandemic, the company ventured into Hazmat suits and Masks, and a lifestyle clothing lineup is now in the pipeline too.
Analysts say the IPO will be about ~₹750 crores in size.
Bottomline — great story, but the times when stories-only could sell on the street are behind us. Profitability and valuation will dictate fate.
Quick look at an old-school fintech raise 🦄
What’s poppin’ — a financial software and consulting player called Perfios raised about $70 million from PE-giant Warburg Pincus and VC-house Bessemer, at what multiple media houses say, valued the business at a $2.5-$4 billion.
Perfios, unlike the sexy zero-to-100 unicorn you’re used to, has been in the business for 15+ years, basically selling a complex software suite that aggregates and analyses large scale financial data such as bank statements, tax data, and business financials to help banks understand the credit worthiness and risk of businesses and individuals.
The company works with more than 200 major banks and other financial institutions, particularly lenders.
Worth mentioning — quickly after the fundraise, Perfios put the $$ to use, buying out a Mumbai-based risk-management software company called Karza in an $80 million deal.
Airtel bought a stake in Indus Towers 🗼
What happened — Airtel is buying a 4.7% stake in a telecom infrastructure company, Indus Towers, from Vodafone, for about ~₹2,800 crores.
Indus ($INDUS) runs mobile towers across India, managing some 185K towers across 22+ telecom circles nationwide. Vodafone used to own about 28% of the company, but began offloading that recently to help raise cash to reduce its debt pile.
About 2.4% of Vodafone’s stake was sold to a consortium of investors recently, and another 4.7% was lifted by the Airtel gang, very kindly. 🙌
Bottomline — with new bosses at the table, VI is rewiring for sustenance. Airtel meanwhile is sowing seeds to secure its 5G future.
Closing out — Zendesk forced to give up SurveyMonkey ☝️
Customer-service software giant Zendesk is forced to terminate its $5 billion take out offer for SurveyMonkey, after its own stockholders rejected the deal.
Zen-CEO tried to spin the news into a positive story, but turns out several activist investors owning 3-5% of the business flat out objected the sale, calling it a vanity pursuit, not adding any concrete value. Bad look for the CEO.
Why does this matter — Zendesk, if you remember, had just weeks ago rejected a $16 billion takeout offer from a bunch of PE giants, thinking with SurveyMonkey combined, it was worth a lot more. 🤣
Now with the deal falling through, the sharks are going to get a whole lot nastier.
Bottomline — valuations have dropped to all time lows in software, making it the perfect environment for M&A, takeouts, and board room fist-fights. Expect a whole lot of market theatre coming in 2022.
What else are we Snackin’ 🍿
🕶️ Consulting in the Metaverse – INFY is launching a metaverse foundry to help clients figure out wtf all the hoopla is about. Investors gotta love that!
✋ Cut them off - western nations have decided to cut several top Russian banks from the SWIFT payment network, increasing economic assault. Here’s a good primer on what the SWIFT is.
💰 Thin ice - local-Indian pharma giant, Sun Pharma, is recalling some meds in the US over contamination worries.
💣 Swedes ain’t joking - Western Europe is responding will full force. Sweden sent Ukraine 5,000 anti-tank missiles, helmets, body shields, and some $50 million in funds, in a $150 million+ deal (***edited from $1.5B).
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! 😀