Weekly Wrap #78: Global VCs pounce down under
Weekly Wrap #78: Global VCs pounce down under
Welcome to our Weekly Wrap, where we cut through the noise to bring you our favourite insights from the technology and startup world.
If you love the Weekly Wrap, please spread the word and help it grow:
Forward this to friends/colleagues by email or Slack
Share on the socials with a short note
Births, deaths and marriages
That’s right! Your favourite segment is back.
Births
Carma. The second hand car market is booming thanks to a low supply of new vehicles at the moment. Taking advantage of that timing, Carma came out of stealth mode to tell the world about a $20m raise from Tiger Global and the launch of its online used car dealership. Carma buys used cars, zhuzhes them up (repairing and making them look pretty), resells and then delivers direct to the purchaser’s door.
Sample. Freshly minted with $920k from Sequoia India, Sample is launching ‘LinkedIn for essential professionals’ - people in hospitality, retail, beauty, warehousing and logistics.
Aussie Angels. Aussie Angels launched a platform to help angel investors share deal flow and form syndicates to invest in startups. A syndicate is a group of investors who invest together as one entity on a cap table. There’s no commitment to invest required, or cost to join.
Convenient deaths
Into thin air. Administrators have reported that Blockchain Global—which operated a cryptocurrency trading platform called ACX that collapsed in October—now owes investors around $50m. The credentials to access millions worth of Bitcoin and Ethereum are supposedly sitting on a laptop owned by former Blockchain Global director Allan Guo… that was stolen in 2019 in China.
Meanwhile, myCryptoWallet also went into administration last week, leaving another set of customers stranded without access to their crypto wallets.
Marriages
Show us your crack. ASX-listed hipages has acquired NZ tradie marketplace Builderscrack in a deal worth $11.8m. In FY21 there were 95,000 jobs posted on the marketplace, making it the leading trades platform in NZ.
[hipages CEO] Sharon-Zipser says the two businesses will remain separate and he has no plans to change the name Builderscrack because “it’s just so appropriate to the New Zealand market”.
Chur.
Sporty Spice. Texas-based Stack Sports is acquiring Team App. Melbourne-based Team App helps coaches, team managers and volunteers communicate and engage with their members and is used by more than 250,000 sporting clubs, teams and social groups. Stack Sports has a suite of tools for sports team management and performance.
Validation. US growth firm Level Equity* has taken a significant stake in Eftsure, valuing the $10m ARR business at $100m-ish. Eftsure provides real-time payment protection and vendor verification services, e.g. ensuring a payees’ account name, number and BSB all match. The deal means another tidy return for Our Innovation Fund, who sold down the bulk of its shareholding. OIF saw a sizeable return from the acquisition of XM Cyber two weeks ago.
*Sound familiar? Level Equity also participated in simPRO’s mega $350m raise last month.
Raise round up
Startups raised over $1.4bn in November - the the second biggest month of 2021 so far. December is shaping up to give November a run for its money. SO many chunky raises this week.
Trend: For the second week in a row, global investors are taking the lead in raises - big and small.
Pet Circle raised $125m. The online pet supplies and services marketplace business is now an Aussie unicorn. The round was led by US-based Prysm Capital and Sydney-based TDM Growth Partners.
Marketplacer raised $38m for its ecommerce marketplace platform. Marketplacer had planned an IPO at the end of last year, but decided to stay private (smart move). Its tech now helps to run over 100 marketplaces around the world, including Woolworths, Myer and Surfstitch.
Kasada raised US$23m (A$32m) led by StepStone Group. Kasada’s tech helps businesses defend against advanced bot attacks:
Since its Series B funding in mid-2020, Kasada has grown its revenue by 230%…Kasada now protects more than $20 billion in eCommerce annually and stops over 5 billion monthly requests left undetected by legacy systems.
Finder raised $30m at a $650m valuation from Future Now Capital. This is its first external funding since being founded in 2006. Finder now operates its comparison site in more than 50 countries, with 10 million visits per month. Expanding beyond comparison, Finder recently announced the launch of an Australia-first crypto product offering 4% annual returns.
Auror raised NZ$30m for its retail crime intelligence and prevention tools led by Movac.
Auror works with some of the world’s biggest retailers including Woolworths, and is now used by more than 13,000 retail locations, supported by more 500 law enforcement agencies worldwide. The platform records more than 100,000 crime events recorded a month.
Carma raised US$20m (A$28m) from Tiger Global (mentioned above).
Ofload raised $20m to optimise trucking fleets - matching shipments to the best available truck using its network of carriers.
Lumi raised $20m from Perennial to grow its alternative lending business. Lumi recently secured a partnership with Openpay to provide SME funding to its customers including HP and Kogan.
Block Earner raised $6.4m led by US VC Framework Ventures. It will launch next year offering investors a way to invest in DeFi products that provide consistent annual yields.
PT Blink raised $5m for its software and marketplace that enables the offsite manufacture of multi-storey buildings.
AllVascular raised $5m from mostly offshore investors ahead of an IPO next year. Its flagship product is an implantable device for targeted delivery of chemotherapy, which aims to reduce the side effects of chemo.
Parkable raised NZ$4.7m in debt and equity led by Pioneer Capital. ‘Airbnb for parking,’ Parkable allows companies and individuals to rent out their empty parking bays. Parkable is growing in the UK with an electric vehicle charging product and has landed its first significant contracts for staff parking management in the USA.
Skykraft raised $3.5m to build a satellite constellation for space-based air traffic management services.
Eugene raised $3.2m to expand its genetic testing products overseas. Eugene provides at-home saliva tests for detecting nearly 300 genetic conditions (targeting parents trying to conceive) and a proactive cancer risk.
Shipeezi raised $1m for its software that provides end-to-end supply chain visibility for some of Australia's largest retailers including Coles and Country Road.
Onwardly raised NZ$1m for its cybersecurity platform that provides SMBs and startups a way to assess their security risk, create policies and build a security roadmap.
Sample raised $920k from Sequoia (mentioned above).
Raising? Change your name to Chris. Founders named Chris have raised a collective $1.2bn across 24 deals so far in 2021.
Investor news
Investible closed $51.6m for its second early-stage fund. Recent investments include Quantum Brilliance (the world’s first lunchbox-sized room-temperature quantum computer) and Functionly (organisational design software). Investible continues raising for its $100m Climate Tech Fund and is developing Greenhouse, a new climate tech growth hub.
Skalata Ventures is half way through its $50m raise, with commitments of over $25m including from Touch Ventures and Afterpay cofounder Anthony Eisen. Skalata also runs a seed stage accelerator program.
Character + Distinction launched a new seed fund, Protagonist. The tech-focussed PR firm will invest in a handful of pre-revenue and early revenue startups each year. They’re on the hunt for consumer or B2B SaaS startups where story can play a supersized role in growth. Given that focus, Protagonist is the best fund name we’ve seen in a while.
Square Peg’s third SPAC. This week its portfolio company Tomorrow.io, a hyper-local weather analytics company, announced it will list on the NASDAQ via a merger in mid-2022. The deal values the company at US$1.2bn. Tomorrow.io (fka ClimaCell) uses data from NASA’s Global Precipitation Measurement (GPM) satellite and other sources to provide analysis for companies heavily affected by weather patterns.
AirTree invested in Zeta’s US$8.5m round. Zeta wants become a critical layer of DeFi infrastructure, starting with auto-strike generation, undercollateralized trading, cross-margining, real-time liquidations, and instant settlement.
Thinking back to the future
One of our favourite tech analysts Benedict Evans released his annual tech trends. Here’s 94 slides summarised in a few paras:
The future
The transformative visions for 2025-2030 are the most exciting themes in tech today: Web3 (new user-controlled models for building software, internet businesses and networks) and the Metaverse (the next platform after smartphones). For example, digital assets are now being taken seriously - the market cap of Bitcoin and Ethereum is over $1.5Tr (a little less than Amazon). But we’re still so early in this journey. Just look to our vision of the consumer internet in 1995 (below) - we don't know what the future looks like in practice. What will stick? What’s just hype?
The present
Digital transformation is still just beginning. Only 10-15% of enterprise IT spend and 20-30% of workflows have moved to the cloud. The modern tech stack is being reshaped by the SaaS business model (enterprises can now easily use hundreds of apps, rather than a handful), plus massive investments in cloud (US$40bn+) by hyper-scale providers like Azure, AWS and Google Cloud. This creates an almost endless opportunity for new business creation.
“Everything the internet did for music or newspapers, is now happening to everyone else.”
The old economy is now trying to adjust to tech disruption. Companies need to rethink logistics models, advertising and UX to adapt for the rise in online of everything - banking, retail, groceries, restaurants:
Global parcel volumes have exploded: 8bn in 2010; 21bn in 2019; 25bn in 2020. Amazon spent US$74bn in shipping in the last 12 months and is expected to be larger than UPS or Fedex in the USA by next year.
Despite its size and influence, Amazon is facing ecommerce competition and smaller brands have a dramatically larger share online. Shopify powered over US$160bn of ecommerce in the 12 months to September, which represents 45% of Amazon’s Marketplace volume.
Even established companies with distribution models that were traditionally B2B are adapting to D2C - nearly 30% of L’Oréal sales are now online.
New brands with great UX, strong data and cash to burn on acquisition are quickly taking younger generations by storm, e.g. Shein broke into fast fashion in a few years; and Revolut has grown rapidly in banking - its UX takes a user around 25 clicks to create an account, compared to over 100 for a traditional bank.
So, of course, investment in tech is at an all time high - matching levels seen in the 2000 bubble, except this time that investment is (largely) based on reality, rather than promise.
Microsoft 30.0
That’s a wrap! We hope you enjoyed it.
Bex, Gavin and the team at Ignition Lane
If you aren’t subscribed to the wrap, sign up now:
Watch Gav on AusBiz at 2pm on Monday!
Seen any interesting startups? Have any tips for the Weekly Wrap? Want to indulge our inner-journalists? Drop us a note: tipoff@ignitionlane.com