Wrap #93: How it started; How it's going 2022
Wrap #93: How it started; How it's going 2022
Welcome to our Wrap, where we cut through the noise to bring you our favourite insights from the technology and startup world over the past month. If you prefer your news in video format, check out our chat with Startup Daily.
If you love the Wrap, please spread the word and help it grow.
What a roller coaster of a year!
How things can change in a short space of time. We looked back through the archives to our first Wrap of 2022 to compare then and now:
Growth rounds & virtual/hybrid collaboration
Then: Multi-billion dollar valuations and US$400m+ capital raisings by virtual collaboration tech companies - Miro, Airtable and Clickup.
Now: Growth rounds are out; ‘fit’ startups are in. Almost overnight, VC advice went from “grow at all costs” to “ensure you have a two year cash runway.”
The war for talent
Then: ‘The Great Reshuffle’ and the need for companies to have flexibility and work-life balance in order to win in the war for talent.
Now: The tables have turned, with thousands of people in tech being made redundant around the world.
Big international VC investment in Australia + grocery delivery hullabaloo
Then: Grocery delivery startups were flavour of the month with big backing from international VCs. Sydney-based Milkrun raised $75m led by Tiger Global and Voly raised $18m led by Sequoia.
Now: Voly has shut up shop. Milkrun is rumoured to have been (unsuccessfully) shopping around for deals with Uber, Coles and now defunct Deliveroo Australia.
Sadly one of the OGs of grocery delivery, Your Grocer, which aimed to help independent grocers announced on Friday that it is also shutting down.
Over in Europe, Getir bought Gorillas this week for US$1.2bn, valuing the two combined at US$10bn vs $15bn last year. Gorillas was reportedly burning $1.50 per dollar of revenue.
In VC land, the most active US VC firms made just seven investments in Australia during the second half of 2022, compared to 28 and 39 in the two halves prior, according to Cut Through Venture.
Elon
Then: Zero mentions of Elon Musk in the Wrap.
Now: We can’t get away from the guy after his Twitter purchase blew up the internet.
What’s remained constant: new VC funds, early-early-stage investing, M&A deals, choppy public markets and Wordle.
The big Aussie VCs raised record funds. Sydney VC AirTree kicked off the year with a $700m raise. Blackbird and Square Peg ended the year with A$1bn and US$550m raises respectively.
VCs ploughed capital into early-stage companies throughout the year, with 80%+ of the big 3 Aussie VCs’ (named above) investments into new companies being seed or pre-seed deals. Square Peg even wrote a whole post reminding people that they invest early.
Local M&A deals continue. Uber acquired Carnextdoor in January. Now, that Aussie-grown product is being roll out around the world as Uber Carshare. This month saw Relay Commerce acquire SmartrMail. Last mile delivery business Drive Yello and café ordering app Hey You also merged.
Wordle took the world by storm. This week Google confirmed it was the most searched term of 2022.
Still relevant:
Local newsings
Winning a market. Australians spent a total of $7.3bn with Uber last year, generating $2bn in revenue and $1bn gross profit. Deliveroo, on the other hand, was losing around $3m a month on its Australian operations before it shutdown last month.
In other closing down news, online furniture retailer Brosa has gone into administration.
FTX ripples. FTX founder Sam Bankman-Fried has been arrested in The Bahamas. Meanwhile, Australian crypto exchanges are battling to stay amid the FTX fallout. Digital Surge went into voluntary administration due to its exposure to FTX. Swyftx has announced it will lay off 40% of its workforce (around 90 people) and CoinJar has cut around 20% of its staff.
Winner winner chicken dinner. Women and purpose-led businesses took out the most wins at Pause Awards ‘22. Two standouts, winning three awards each were Great Wrap (compostable Stretch Wrap made from potatoes) and Verve (ethical super fund for women). In the Deloitte Tech Fast 50, Montu (medical cannabis telehealth and training) was announced as the overall winner, followed by FrankieOne (fraud and money laundering risk management) and me&u (restaurant table ordering platform).
New local funds
Melt Ventures launched Australia’s first dedicated Advanced Manufacturing Venture Fund (e.g. clean technologies, automation and robotics, agriculture, transport and space), targeting a $20m raise by the end of March 2023.
Accelerator, Startmate is aiming to raise $30m by early 2023, including for a new Continuity Fund that will let Startmate continue backing its successful alumni as they mature.
Community Capital launched a new credit fund that will donate a portion of its management fees to charities. The fund aims to give multi-year grants of between $100,000 and $500,000 a year to 10 and 15 early-stage social purpose organisations.
In the US of A
Grow big or go home. US VC a16z launched a Guide to Growth Metrics benchmark tool for VC-backed B2B companies.
Everyone is leaving Salesforce. Slack CEO Stewart Butterfield is leaving in early January. This comes less than a week after it was announced that Salesforce’s vice-chair and co-CEO Bret Taylor will be stepping down and Tableau CEO Mark Nelson is also moving on (Butterfield says the departures aren’t related).
Open iPhone. After ferociously fighting to keep iOS as a closed ecosystem, Apple is preparing to allow alternative app stores and side-loading on iOS in response to looming EU requirements. It is also exploring opening up its camera and NFC stack to developers.
Terrible UX. Hertz will pay $168m to settle 364 claims related to the company falsely reporting rental cars as stolen. Thanks to a few bugs in Hertz’s back-end systems, its innocent customers were stopped at gun point, arrested and even imprisoned.
Jail, cont’d. Theranos Exec Sunny Balwani was sentenced to 13 years in prison for defrauding patients and investors - that’s 2 more years than CEO Elizabeth Holmes.
Chinwag. Over 2 million people have signed up to use OpenAI’s conversational text-generation model, ChatGPT. Massive hype and an equal amount of criticism:
“It often looks like an undergraduate confidently answering a question for which it didn’t attend any lectures. It looks like a confident bullsh*tter.” - Benedict Evans
Here’s VC Turner Novak giving ChatGPT a whirl:
This wrap was not written by ChatGPT (yet).
That’s a wrap! Thanks for joining us this year. See you in 2023.
Bex, Gavin and the team at Ignition Lane
If you aren’t subscribed to the wrap, sign up now:
Seen any interesting startups? Have any tips for the Wrap? Want to indulge our inner-journalists? Drop us a note: tipoff@ignitionlane.com
Fascinating view of the 'before' and 'after' 2022. So much has happened, so much has changed !