Weekly Wrap #38: Jay-Z & Jack, Rocket Lab SPAC and Bond is Back
Weekly Wrap #38: Jay-Z & Jack, Rocket Lab SPAC and Bond is Back
Welcome to our Weekly Wrap, where we cut through the noise to bring you our favourite insights from the technology and startup world.
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Let’s dive straight into ANZ deals
Xero acquired Denmark-based workforce management platform Planday. With a price tag of €183.5 million in shares and cash (including earn out), this is its largest acquisition to date. Xero, which currently has a market cap of nearly A$17B, has been ramping up its M&A team - watch this space.
Sensis, publisher of the Yellow and White Pages, has been sold for A$260m to Nasdaq-listed Thryv Holdings, which owns the Yellow Pages brand in the US. More than six million searches are made every month on Yellow.com.au. The sale comes seven years after Telstra sold a 70 per cent stake in Sensis to US private equity firm, Platinum Equity, for $425m.
Atlassian is acquiring Chartio to add a new data analysis and visualisation component to the Atlassian family of products:
Atlassian products are home to a treasure trove of data, and our goal is to unleash the power of this data so our customers can go beyond out-of-the-box reports and truly customize analytics to meet the needs of their organization.
Startup life - a visual journey. Chris Duell shared Elevio’s investor updates with the world, following its acquisition by Dixa. What a great comms strategy - how could an investor possibly get upset over bad news with such an elegant use of gifs?! A good high level insight into the ups and downs of running a startup.
Space X’s biggest rival? This week Rocket Lab unveiled Neutron, its first rocket capable of human spaceflight and a “direct alternative” to the SpaceX Falcon 9 rocket. In a blow to the NZX, it also revealed it is going public via a SPAC at a valuation of US$4.1b! Much of that cash will be pumped into Neutron, which the company wants to start flying in 2024.
Relatedly, Space X launched another batch of Starlink satellites and completed a test flight of SN10 - its current prototype series of heavy-lift reusable spacecraft, Starship. Incredible!
Karbon raised US$10m from Five Elms Capital as a strategic investment. The accounting practice management startup partnered with Intuit last year and now serve more than 1,600 firms after doubling its number of active users over 2020.
Procurement platform VendorPanel raised $4.5m.
Deferit raised $15m led by existing investor Carthona Capital and new investor Alceon Group. The ‘BNPL’ startup lets customers split utility, telco or childcare monthly bills into four instalments.
Can’t knock the hustle
Square has purchased a majority stake in Tidal, a music streaming service, for nearly US$300m. As a part of the deal Jay-Z is joining Square’s board.
Tidal was founded in Norway in 2014 before being bought by a group of artists (including Coldplay, Rihanna, Daft Punk, and Madonna) led by Jay-Z in 2015 for $56m.
But despite the big name backers and a $200m investment from Sprint in 2017, Tidal failed to live up to the hype. The platform has been unable to significantly grow its subscriber base over the years. It has faced also criticism for underpaying artists - as of last year, the company was still behind on payments to rights holders.
Square is a payments-focused tech firm with a market cap of around $100B. Best known for its signature portable square white card reader, the company’s products have gradually expanded to include business loans, money transfer services, Bitcoin/crypto trading and a Visa debit card. This week it officially became a bank.
So why would a bank buy a failing music streaming service? Here’s the official answer.
More interestingly, conspiracies are abound that the deal is really about NFTs—non-fungible tokens—which have exploded as a trend in crypto. Huh? We’ll let The Verge explain:
“Non-fungible” more or less means that it’s unique and can’t be replaced with something else. For example, a bitcoin is fungible — trade one for another bitcoin, and you’ll have exactly the same thing. A one-of-a-kind trading card, however, is non-fungible… At a very high level, most NFTs are part of the Ethereum blockchain. Ethereum is a cryptocurrency, like bitcoin or dogecoin, but its blockchain also supports these NFTs, which store extra information that makes them work differently from, say, an ETH coin.
NFTs have taken off in the world of music as a means for super fans to “invest” in artists. This means artists can sell digital media at higher prices and collect a cut of secondary sales. Kings of Leon announced they planned to release a new album through an NFT sale. Grimes sold $6 million worth of digital art as NFTs. Electronic dance music star 3LAU held a $11.7 million NFT auction - selling off access to new songs and digital copies of his 2017 Ultraviolet album.
So, back to Tidal-Square. Tidal needs to pay its artists more. And Square has a growing crypto trading business, a large consumer base and hundreds of millions of dollars worth of bitcoin. Together they could form the leading position in a new NFT market.
Or maybe Jack Dorsey is plotting to merge Square with his other business, Twitter.
Even if NFTs fade into oblivion, Square will surely benefit from having a fresh-thinking creative genius on its Board. Dorsey might have 99 problems, but Jay-Z ain’t one.
Side note, The Defiant Ones (on Netflix) is an exceptional miniseries that tells the entrepreneurial tale of Jimmy Iovine and Dr Dre’s partnership - from N.W.A. to Beats. Well worth a watch.
Celebrating the innovators
Inside Retail’s Top 50 People in Australian E-Commerce
Flora & Fauna founder and CEO Julie Mathers has taken out the top spot in Inside Retail’s Top 50 People in E-Commerce 2021. Flora & Fauna is Australia's largest cruelty free & vegan shop with exclusive eco friendly products. From judges:
“From launching a custom built rewards program and gift registry to leading a major replatforming project, Julie delivered some big customer experience improvements in 2020. She also started a conversation about plastic waste in the supply chain with her Take It Back campaign and helped several of her e-commerce peers step up their own sustainability efforts. Her impact is felt far beyond Flora & Fauna.”
Other stand outs include “The visionary” The Sheet Society Founder/CEO Hayley Worley (#8) and “The role model” Aje’s Head of ecommerce Georgie Yates (#9). Congrats to all!
Trade Me New Zealand Innovator of the Year Award finalists – Te Pou Whakairo o te Tau
The awards recognise a person or group who, in the spirit of Kiwi inventiveness and resourcefulness, have created a better New Zealand. Three finalists were announced this week:
Craig Piggott is the CEO of Halter. Founded in 2016, Halter is a US/NZ company that has developed technology to modernise the dairy industry by physically moving and guiding animals under machine learning control.
Kami: Hengjie Wang, Alliv Samson and Jordan Thoms & Bob Drummond. EdTech Kami’s (‘paper’ in Japanese) audio & video-enhanced assignments, digital whiteboarding and sketchnoting tools have transformed the way students and teachers worldwide engage with digital information, learning resources, and each other - in the classroom and beyond. Over 22 million students and teachers across 180 countries every schoolday and is ranked the No.1 document annotation application in the Google Web Store. Kami has offered free subscriptions to all schools in Aotearoa and any school affected by the pandemic.
In 2014 Ranjna Patel established the first Gandhi Nivas home for family violence perpetrators for rehabilitation in Otahuhu. The program was novel because men are removed from the family home, rather than uprooting the mother and children. Massey University released a 5-year longitudinal study, which found 60% of men who had been through a Gandhi Nivas home did not re-offend. There are now three permanent Gandhi Nivas homes in Auckland, all staffed 24/7 by counsellors, social workers and Alcohol and Drug counsellors.
Round the globe
Indie.vc is ending. In 2015, Bryce Roberts via O'Reilly AlphaTech Ventures (‘OATV’ a typical early-stage VC firm) started Indie.vc as a pilot program to finance sustainable, sometimes profitable businesses. It was a new school of thought for startupland, which had been dominated by VC’s ‘spend to hyperscale, fast’ mentality. However, the more Indie-focussed OATV became over the years, the fewer limited partner investors it could attract - ultimately leading to its shut down. But all is not lost. Roberts has certainly started a movement around ‘sustainable’ startups and, as a result, we’ve seen the rise of alternative funding mechanisms from the likes of Lighter Capital and Aussie’s own Tractor Ventures. Good read: ‘What’s in a name’.
Bond’s latest mega fund. “Queen of the Internet” Mark Meeker’s Bond VC closed its second fund with $2 billion in capital commitments. There are high hopes for Bond in the world of VC. Its investments include Indian edtech Byju, UK neobank Revolut, Canva, Locus Robotics and Nextdoor. Bond hired former Atlassian president, Jay Simons late last year to lead its global enterprise practice.
Speaking of Atlassian, the Aussie giant has selected Stripe Billing as global billing and payments solution for all product offerings. Another huge coup for Stripe.
With our powers combined, we are Captain Authentication! Identity and access management (IAM) behemoth Okta is acquiring another IAM auth0 for $6.5b. Okta provides single-sign-on access for employees to a variety of cloud services, e.g. Gmail, Outlook, Salesforce, Slack and Workday. Auth0 is a developer tool providing coders with easy API access to single-sign-on functionality. Gartner projected that IAM would grow to over $13.5b this year. Kinda makes $6.5b sound like a hefty price tag, but the bet could pay off in the long term.
The beginning of consolidation in marketing solutions? Online consumer intelligence and social media listening platform Brandwatch has been acquired by Cision—best known for its media monitoring and media contact database services—for $450m.
Hopin’s 81x ARR val. Hopin closed a $400m Series C, valuing the business at $5.65b. Andreessen Horowitz and General Catalyst co-led the round. The virtual events platform and video-focused software service was founded in mid-2019, raised $40m Series A in June 2020 and a $125m Series B in November 2020. “At $70 million ARR, Hopin is worth around 81x its current annual recurring revenue.” Mind blown.
IWD happenings
It’s International Women’s Day on Monday. We wanted nothing more than to do a weekly wrap filled with news about women-led startups and women superstars. But at times it feels like there’s more news about BNPL startups than there is women in tech.
Men, women and non-binary are an equal part of the equality equation. To make change, we all need to #ChooseToChallenge (the IWD theme this year) and be a part of the discussion.
So, in case you don’t have any IWD events lined up in your diary, here are our picks:
Rare Birds: Is Male Allyship Required to Interrupt Gender Bias?
Rae Cooper AO (University of Sydney), Troy Roderick (Inclusion & Diversity Advisor), Dai Le (Founder of DAWN and Councillor at Fairfield City Council) and Josh Griffin (SBS).
8 Mar, at 1:00 PM
Women forging innovation through technology in Australia
Rebecca Burrows (DoorDash), Prue Cox (LinkedIn), Natalie Field (Belong) and Fiona Morphett (DoorDash Drive).
9 Mar, 12:15 PM
Scale x Startmate virtual mix and match
A two-part event where women founders will be connected directly with investors and rising talent.
10 Mar, 12pm (paid event)
Women in eCommerce
Sandradee Makejev (St Frock), Julie Mathers (Flora & Fauna) and Aparna Gray (dotdigital).
10 Mar, 1:30pm
OneRoof: Honouring Women's Successes and Sacrifices
Christina Hobbs (Verve Super), Angela Priestley (Agenda Media),Sarah Agboola (mtime), Jo Stanley (media extraordinaire), Sheree Rubinstein and Frances Goh (One Roof).
11 Mar, 12pm
Connect with female Aboriginal Artists
Keturah Zimran (Ikuntji Artists), Chanveasna Nhean (Women For Women a social enterprise in Cambodia that recruits, trains, supports and employs disabled women and minority groups in remote communities), and Felicity Wright (Flying Fox Fabric).
22 March, 03:30pm (paid event)
The road to the boardroom and equal representation
Despite the fact that Australia has been churning out more female university graduates than male grads for the last 30-odd years, women only make up 21.8% of board and chair positions in Australia – and the numbers of young women are even smaller! So how exactly do you get on a board? What skills and experience are required? And what sort of equal representation is important, and why?
29 Mar, 7.30pm (paid event)
Auxilia - Linking women
Check out Auxilia, a LinkedIn group started by Product guru Georgie Smallwood (Xero, N26, TIER Mobility):
Auxilia (Latin for helping hand) exists as a place for women who are Founders, are interested in Founding/co-founding, or want to join early-stage teams. Targeted at women with 4yrs + professional experience we will discuss, debate and connect with the purpose of increasing awareness and funding to female-founded, tech enabled businesses. The Group will also consist of women in positions to fund/advise/support.
That’s a wrap! We hope you enjoyed it.
Join us on Clubhouse, 8.30am Tuesday.
Bex, Gavin and the team at Ignition Lane
www.ignitionlane.com
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p.s. We love feedback - if you have any or want to continue the conversation, please reach out. Watch Bex on AusBiz at 2pm on Monday, when she opens the Startup Daily TV show.