What’s brewing hot? ☕
✅ One step at a time — Tesla is in close talks with some top Indian automakers and parts manufacturers for purchase of key components like windshields, brakes and power seats, to kick off its India operations. Tesla already buys some key material from Indian parts makers like Sona Comstar, Sandhar, and Bharat Forge, which should put these guys at the top of the potential suppliers list.
✅ One step at a time — Square’s newest Bitcoin business, which is Jack Dorsey’s aspirational project no.1, offered some direction into what they’re actually building — which at its core involves a decentralized Bitcoin exchange. Square will also allow developers to build on top of the exchange infrastructure, which when combined with Square’s existing ecosystem of millions of merchants and consumers, brings a whole new set of possibilities under light.
India’s first SaaS IPO is here 🔥
Freshworks, one of India's foremost cloud-software companies, submitted its docs for a Nasdaq listing, looking to raise $100M at a $3.5 billion valuation.
For the uninitiated, Freshworks started as a customer support chat tool back in 2008, and was one of the first product-led software businesses coming out of India, deviating from the common IT services market India was known for. Since then, the company has moved into marketing, HR tools, IT management, and a broad suite of adjacent software services.
And the numbers look stellar — revenues grew 40% YoY last year, in-line with the broad cloud and SaaS industry, topping $308M in sales with ~$10 million in losses, which isn’t too bad when compared to peers.
Bottomline — $3.5B valuation is a steal. Freshworks’ rival Zendesk trades at 15 times its revenues, which puts Freshworks at ~$5.6B market cap.
Big picture — successful listing should draw a lot of attention to India’s emerging SaaS economy, driving even more capital into the space.
While we’re on IPOs,
Homegrown digital map maker, MapmyIndia is set to go IPO, looking to raise $175 million at an $825 million valuation.
MapmyIndia basically builds localized maps tracking India’s roads infra (if you can call it that), and supplies that intelligence to global automakers and software enterprises, in few cases powering Apple Maps and Amazon’s Alexa in India. Revenues hover in the ~₹150crores range, with modest profits.
Nazara made a move 🔥
What happened — gaming company Nazara Tech acquired OpenPlay, another online real-money gaming player, in a ₹186 crore deal.
OpenPlay basically hosts skill-based games like quizzes, poker and other esports staples, where users can bet money to win a much larger pool. Revenues top ₹80 crores for the past year.
Nazara is executing an agenda to have 10% of its revenue base come from real-money gaming (from ~2% levels currently), and this acquisition along with the purchase of Halapay in 2019 will help with that.
Key takeaway —real-money gaming is a $1 billion market, expected to grow 40% over the next four years.
Getting you up to speed with big tech land 💰
🏃♀️ Investors hammered work-equipment maker and pandemic-darling Peloton, taking stock down 15% in a single day because well with COVID restrictions ending, people don’t actually like to be stuck in their basement on a bike, staring at a screen. Peloton’s unit sales fell short of expectations last quarter, and management told markets they plan on dropping the cost of the bikes by $400!
🖥️ Computer device companies are struggling with supply chain issues. Dell Computer was hammered 5% because management said it can’t get production and delivery to keep pace with orders. Later in the day rival HP echoed the sentiment — saying demand from remote learning and hybrid work was strong, but fulfilling orders is becoming a pain with supply chain problems, chip shortages, and port closures because of delta.
📈 Lastly, chip manufacturing giant TSMC is raising the prices of its wares by 20%, to make up for semi shortages, labor issues, and supply chain problems, which is about to reverberate through the chain making end consumer electronics you buy equally expensive.
Key takeaway — the world is swiftly moving into a post-COVID reality, while carrying “debt” from the 2020-boom into your portfolio could be catastrophic.
Closing out — Amazon jumps on BNPL wagon 😎
What happened — Amazon surprised the markets late Friday night when it disclosed plans to work with Affirm to allow consumers to split purchases above $50 into monthly payments.
A BNPL move from AMZN was expected for a while now, but an Affirm partnership? Low on the charts. But... Wall Street Bets got an early whiff of the deal a few weeks ago.
Anyway, even if 10% of Amazon’s total volumes get processed via BNPL, that throws $65-$75 billion in volumes to Affirm, or ~$1B in revenues.
Market reaction — Affirm stock jumped 35% in late Friday night market trading.
Big picture — 200M+ people shop on Amazon each month globally. This integration could finally bring mainstream behavioral buy-in, landing a final death-blow to use of credit cards online.
What else are we snackin’ 🍿
❌ No foreign travel - DGCA extended the ban on international travel to and from India until September 30.
🥈History maker - Bhavinaben Patel won a silver in Table Tennis at the Paralympics, becoming the second Indian woman ever to win a medal at the games.