Women CEOs rock 😎
Major venture raises, and stuff from the week before.
Hi 👋, Tanvi here.
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Market summary: 📊
Another boring session in India, finally ending the week on a low. US had a great day, bringing major indices back to all-time high areas.
US:
S&P 500 - up 1.13%
Nasdaq - up 0.71%
India:
Nifty 50 - down 0.24%
Sensex - down 0.35%
Weekend shot of espresso? ☕
✅ Smoking COVID away — global tobacco granddaddy Phillip Morris ($PM), maker of the Marlboro cigarettes, is buying out a British pharma giant Vectura for $1.5 billion — guess what Vectura does? Makes inhaler devices and other nasal drugs, and is apparently pioneering an inhaled treatment for COVID. Philip Morris is looking to ride the wave to pull off a “wellness” transformation, and so far has spent $8 billion on turning the business around via acquisitions. Don’t forget the 4.8% dividend...
Bring me your best gladiator...⚔️
What happened — grocery delivery startup Instacart, which is valued at over $39 billion, replaced its CEO, moving founder Apoorva Mehta to “Chairman” role, and bringing in Facebook hotshot, Fidji Simo to drive the bus.
Fact that Apoorva has been a stellar founder-CEO and yet gets replaced was kinda surprising.. but then 👇
Problems brewing? — after an EPIC run up during 2020, there has been some chatter about Instacart’s sales volumes flatlining and declining in 2021. Now 2020 was an odd year for sure, and trumping that is hard, but when companies like Uber, DoorDash and Amazon continue to gain share, it's hard to come up with excuses.
Bigger strategy — also, the Information had recently reported that Instacart was on its way to make almost a BILLION DOLLARS this year from guess what… Ads.
Hiring Fidji, who led Facebook App, and made big bucks for Zuckerberg, is a sure shot way to double down here.
Instacart also has been poaching other top FB execs...
Bottomline — unit economics of delivery are horrible. $5 Apples, cost $10 to deliver to your house. Diversifying the business with ads is a powerful way to bolster margins, and compound leverage.
You listenin’ Zomato?
And then a quick look at Venture Street ✋
With lockdowns persisting, cash bleed extending, and bills from its mammoth EV factory in the outskirts of Bengaluru piling up — Ola is back on the phone with investors.
Rumours are, a $500 million pot is being put together by Temasek and global PE giant Warbug Pincus, with Bhavish Aggarwal pitching in some of his own dough.
And if Uber’s rebound is any indicator — the ride-hailing market has recovered extremely strongly in global regions, and investors can confidently see some light at the end of the tunnel .
Also, that cool video of Bhavish taking the latest electric bike for a spin gotta help with those checks getting signed faster.
Moving on, winners keep winning 👐
PharmEasy is working with Softbank to raise another $200 million at a $5.6 billion valuation, barely days after closing a Series F round.
With diagnostics company Thyrocare in its pocket, and the acquisition of Medlife wrapped up, the case for a digital end-to-end care-delivery company is becoming stronger by the day.
That’s it for today folks, here’s a quick look at all major things that went down this week
💪 FMCG lookin’ good — Dalal Street drew some confidence from a few major FMCG companies offering stellar guidance, despite last quarters’ messy operating conditions. Parachute-maker Marico guided for 30%+ growth rates, and santoor-maker Godrej Consumer echoed similar sentiment. Pandemic battered supply chains have recovered stronger, higher prices are helping sales growth accelerate, and with revenge spend kickin in, the entire FMCG game is looking quite sexy in the short term.
😡Hackers rule us now — another high-profile ransomware attack is eating through thousands of corporations. The hack infiltrated a managed IT services provider called Kaseya from Miami, spread itself through Kaseya’s clients, and is now touching 1,000+ global enterprises, and millions of end customers. Several businesses have already had to stop operations overnight. Biden admin downplays the hack, but global corporations and nations are running scared.
🚗 Not again, pls — Tata bought bad news to the Indian automotive party, which had just started to see sentiment turn after some rebound in volumes. Per Tata, the ongoing semiconductor shortage will continue to weigh on the industry, hurting volumes by almost 50%, which could lead to consumer cancellations, eventually weighing on revenues and profits. Tata stock was hammered down 8% in a day, while impatient near-term investors bailed on the auto sector broadly.
🚘Europe’s grand electrification — Volvo, Daimler and Volkswagen, three of the largest truck makers in the EU, announced a $600 million joint venture, to build 1,700 charging stations to support long-haul electric trucks and buses, across Europe. Lack of charging infrastructure is a major bottleneck for automakers worldwide, and this so far is one of the most aggressive moves where automakers take matters into their own hands. India should consider mimicking.
🔥 Cloud war’s over — the US DoD dumped the widely fought over $10 billion cloud digitization project, called “JEDI”, ending year long infighting between Microsoft, Amazon, and the US Gov. Microsoft had won the contract in 2019, pissing off rival Amazon, which had pushed Bezos to sue the government for impartiality (Trump hating Bezos made things uglier). Anyway, influenced by the ongoing cyberattacks, Pentagon is now looking at taking a multi-cloud approach.
💻 Indian SaaS is legit— a joint report by SAAS Bhoomi and McKinsey says the Indian SaaS market is capable of generating $1 trillion in market value, employing 500K+ skilled labor and pulling in about $40 to $50 billion in revenues by 2030. Quite a promising outlook and one of the staunchest vote of confidence in the local ecosystem just as concerns on rising valuations and high salaries try to break at the venture ecosystem’s unfettered optimism.
🤑 Round up of major startup raises this week —
Online insurance giant Digit raised $200 million from Sequoia, IIFL and others, doubling valuation to $3.5 billion. Premiums have grown 44% to ₹3,200 crores+ over the past year, with nearly 20 million customers served.
Used cars marketplace Cars24 is courting DST Global for a $250 million fundraise, doubling valuation to $2 billion. Cars24 is betting on fear of public transport to persist after COVID, and that increased prices of cars will force consumers to give used vehicles a legit shot.
Meanwhile, furniture subscription service Furlenco raised $140 million in a Series D, led by Zinnia Global Fund. The business operates in 13+ cities, making ₹100 crores in revenues in 2020, with ₹7.5 crores in profits last year — a rarity in the D2C biz.
Biggest blockbuster raise came from payment processor Pine Labs, which raised $600 million, at a valuation of $3 billion from Fidelity, BlackRock, and others. Payment volumes for the omnichannel merchant processor have topped $30 billion annually, as mainstreet aggressively shifts to accommodate digital payments.
Lastly, in old-finance town, Japan’s 2nd largest financial services company, Sumitomo Mitsui (SMFG), invested $2 billion to buy out 74% stake in India based Fullerton India Credit — betting large on the prosperity of the Indian middle class. Fullerton India works with 630 brick and mortar locations, reaching 3 million end consumers and sells your typical home, car, and personal loans.
Hit that 💚 if you liked today’s issue.
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