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| Hey Insiders, Today we are taking a look at the reduced pace of acquisitions done by the Big Five U.S. tech companies, the $1.8B in funding deployed into green infrastructure startups in H1, and Tiger Global's sale of its Flipkart stake to Walmart for $1.4B. I hope you enjoy today's edition! Karan
p/karan-chafekar | |
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The five highest-valued tech organizations in the U.S. –Apple, Microsoft, Google, Amazon, and Nvidia– have collectively acquired just five startups so far this year. Four of the startups were in the seed stage. The five startups acquired by the "Big Five" tech organizations had collectively raised just $57M in equity funding. With the present pace of deal-making, this year will likely conclude with the fewest acquisitions in recent times. More: - Initially, investors anticipated a surge in M&A activity, expecting larger organizations to scoop up startups at discounted prices.
- Recent deals suggest that Big Five tech firms are still keen on acquiring established organizations.
- Microsoft is proceeding with its acquisition of Activision Blizzard for $68.7B and Google bought cybersecurity firm Mandiant for $5.4B last year.
- The broader M&A landscape has also experienced a period of subdued activity due to macroeconomic headwinds.
- While acquisition deal-making has declined, corporate venture capitalists have increased their startup funding.
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What the numbers say: Climate tech startups focusing on green infrastructure raked in $1.8B in venture funding in the first half of the year. Annual funding is on track to surpass the previous record high set in 2021. Funding for built infrastructure startups is defying the venture funding retrenchment that has impacted all sectors and the broader climate tech sector. While climate tech funding has plateaued at around $3.6B to $4.2B per quarter recently, green infrastructure startups are gaining traction. Relevance: The two most notable deals that closed in the first half were HVAC energy efficiency startup Redaptive's $250M Series E round and energy electrification data analytics startup BlocPower's $154M Series B fundraiser. Former NBA player Rick Fox launched a concrete CO2 removal startup Partanna with $12M in pre-seed funding, four times larger than the median round size of $2.9M for the same quarter. Why it matters: Leopold Spenner, the founder of sustainable concrete software startup Alcemy, said, "We see companies active in the hardcore decarbonization space, and more startups willing to touch hardware and software together." | | | |
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| 3 | | Tiger Global Management exited its holdings in Flipkart, selling its remaining stake to Walmart for $1.4B. The transaction values the Indian e-commerce startup at $35B, lower than its peak valuation of $38B in 2021. Accel also sold its remaining 1.1% stake to Walmart, netting nearly $1.5B to $2B return over its initial investment, estimated to be between $60M and $80M. More: - The deals allowed Walmart to increase its stake in Flipkart from 72% to 77%.
- It acquired the majority stake in Flipkart for $16B in 2018.
- The move showcases Walmart's commitment to increase its foothold in India's growing consumer market.
- Tiger Global had initially invested $8.6M in Flipkart's Series B round in 2009, which valued the firm at $42M.
- The investment firm invested $1.2B in Flipkart between 2010 and 2015 through its various venture funds, hedge fund, and long-only vehicle.
- Tiger Global has netted $3.5B in gains on its investment in Flipkart.
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| 4 | | Stock and crypto trading platform eToro gave early employees and angel investors an option to liquidate their holdings through a secondary sale. The secondary sale to existing investors saw transactions worth $120M. Sources informed CNBC that the share prices at the transaction gave eToro a slightly lower valuation than its most recent valuation of $3.5B. More: - As the transaction is a secondary sale, eToro did not issue any new shares nor raise additional capital.
- The secondary sale round comes nearly a year after eToro scrapped plans to go public via a SPAC merger with blank check firm Fintech V, which would have valued the firm at $10B.
- The Israeli startup raised a $250M venture round earlier this March from SoftBank Vision Fund 2, ION Investment Group, and Velvet Sea Ventures.
- The transaction took the form of an advance investment agreement, enabling investors to pay in advance for shares to be allocated at a later date.
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| 5 | | U.S. asset manager Fidelity revised the value of its stake in SaaS startup Gupshup to $8.08M at the end of June, down 20% over its previous value of $10.15M from May. Fidelity initially invested $16.2M in the business messaging startup from its Blue Chip Growth Fund in mid-2021. More: - Fidelity's stake has more than halved in value since the original investment.
- Gupshup was valued at $1.4B at the time of the initial investment.
- The Indian startup raised a $240M Series F funding round in July 2021 from Tiger Global, Think Investments, and Malabar Investments.
- The investment came barely four months after it had raised a $100M round earlier in Apr. 2021.
- Fidelity increased the value of its stakes in Reddit, Discord, X Holdings, and Meesho at the end of June.
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| 6 | | Today's Funding: Blockchain - Japanese blockchain solutions developer HashPort bagged $8.5M in Series C funding led by Sumitomo Mitsui Banking Corporation, The University of Tokyo Edge Capital Partners, and Yusaku Maezawa.
Cleantech - Canadian cleantech startup Carbon Upcycling Technologies nabbed $26M (CAD $34.4M) in Series A funding co-led by BDC Capital's Climate Tech Fund and Climate Investment.
- Woburn, Mass.-based clean technology startup Veir secured $24.9M in Series A-2 funding from Breakthrough Energy Ventures, The Engine Fund, Congruent Ventures, VXI Capital, and others.
Energy - Australian solar thermal technology startup GlassPoint reemerged with a $8M Series A funding round led by 300PPM. The firm had previously reached a peak valuation of $400M before it liquidated in 2020.
Mining - Australian mining tech startup Plotlogic raised $28M (AUD $43M) in Series B funding co-led by Galvanize Climate Solutions and SE Ventures.
PropTech - German eco-friendly retrofitting tech startup Ecoworks received a €22M ($24.3M) Series A capital injection from PropTech1 Ventures, Zacua Ventures, Blackhorn Ventures, Warema Group, and others.
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- Vanquis Banking Group acquired British money management app Snoop for an undisclosed sum. The firm had last raised a £15M ($19.2M) Series A round at a post-money valuation of £47M ($60M) in 2021.
- Swedish buy-now-pay-later startup Klarna shuttered its open banking brand Klarna Kosmo less than 18 months after its debut.
- Peak XV Partners, the $9B Indian VC firm, is holding a closed-door meeting with founders of more than 200 portfolio startups to address concerns over its split from Sequoia Capital.
- Vietnamese VC firm Touchstone Partners is in talks with potential investors to secure backing for its second fund.
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