VENTURE CAPITAL MARKET REVIEW, ISSUE 25 (FEBRUARY 16-22)
Last week came out to be a week of Asia: South-Korean Samsung corporation acquired company competing Apple Pay technology, Indian startup raised $4 million and famous 500 Startups accelerator started investing in Thailand startups
M&A. Samsung Acquires An Apple Pay Competitor
Samsung has acquired LoopPay. The acquisition confirms earlier rumors that suggested the two were working closely together on an upcoming project, and suggests Samsung could make use of LoopPay’s technology to offer is own Apple Pay competitor on future devices.
LoopPay even advertises its solution as an alternative to Apple Pay for non-Apple device makers, and advocates its compatibility with systems already in place at retailers throughout the U.S. Its tech currently works using a standalone fob or a CardCase, which incorporates the payment tech into a protective case designed for use with some of the top smartphones currently available. A LoopPay app allows you to input and store payment card information, and the case communicates wirelessly with existing tap-to-pay terminals available at merchants and retailers. It works by mimicking mag stripe technology, meaning it shouldn’t even require updated hardware in most stores.
LoopPay founders Will Grayling and George Wallner will join Samsung’s Mobile Division as part of the acquisition arrangement, and both the company’s talent and the tech will help the smartphone maker further its mobile wallet ambitions. Samsung is making very clear that the acquisition will help it produce its own mobile wallet solution, likely a direct competitor to Apple Pay.
M&A. Infosys Acquires SaaS Provider Panaya In Deal Valued At $200M
Consulting and IT services provider Infosys announced that it will acquire Panaya, an enterprise resource planning (ERP) software company. Worth an enterprise value of about $200 million, the deal is expected to close by the end of March.
Infosys, which is based in Bengaluru, India, said that it will integrate technology from Panaya’s CloudQuality suite to bring automation to some of its software. CloudQuality helps businesses test changes to SAP, Oracle EBS, and Salesforce software by identifying functions that might break and providing potential solutions including code corrections.
Vishal Sikka, who was named CEO and managing director of Infosys last summer after resigning from SAP, said “The acquisition of Panaya is a key step in renewing and differentiating our service lines. This will help amplify the potential of our people, freeing us from the drudgery of many repetitive tasks, so we may focus more on the important, strategic challenges faced by our clients. At the same time, Panaya’s proven technology helps dramatically simplify the costs and complexities faced by businesses in managing their enterprise application landscapes.”
M&A. Renaissance Learning Acquires UClass
Renaissance Learning, the Google-funded K-12 assessment and learning analytics service with a valuation north of $1 billion, announced that it has acquired UClass, a cloud storage and content management service school districts can use to store, distribute and analyze their curriculum catalogs. The two companies did not disclose the financial details of the transaction.
By combining the two services, Renaissance Learning — which is currently being used by about a third of U.S. schools — will be able to help teachers match students to the right content that’s already approved by the state and part of its curriculum. This way, teachers will be able to see how students are doing and quickly match them with the right set of existing resources in the UClass library, where all the content is already tagged based on the state standard and/or skill.
Renaissance Learning will continue to operate UClass for existing customers. The company doesn’t have any plans to shut the standalone service down right now. Renaissance is also working on integrating the two services and expects to launch its integrated platform in the second half of the year.
M&A. Just Eat Acquires Mexican Online Take-Out Ordering Service SinDelantal.Mx
The online take-out ordering behemoth (and recently publicly listed company) Just Eat has acquired Mexico’s SinDelantal.Mx to add to its Latin American presence and keep up the pressure on Rocket Internet’s Foodpanda.
SinDelantal.Mx’s founders, Diego Ballesteros and Evaristo Babé, also founded and sold Spain’s SinDelantal to Just Eat back in late 2012, for a £2.5 million.
Just Eat isn’t disclosing how much it’s paying for SinDelantal.Mx, although, according to the rumour mill, it’s thought to be one of the largest, if not the largest, online company exits in Mexico.
Meanwhile, Evaristo Babé and Diego Ballesteros are to become the new country managers for Just Eat’s Mexican operation.
STARTUP. India’s News In Shorts Raises $4 Million Series A Round
News In Shorts, an India-based company that operates a news digest app for iOS and Android, has raised a $4 million Series A round led by Tiger Global.
The funding round for the New Delhi-based startup included participation from Japan’s Rebright Partners and existing investors Sachin and Binny Bansal, the founders of e-commerce firm Flipkart. The startup raised an undisclosed seed round last June, and counts media firm Times Internet among its backers.
News In Shorts is an interesting service that has comparisons with Yahoo’s News Digest app and mobile news startup Circa. It provides its target audience in India with 60-word summaries of the day’s top stories, that’s typically 60 summaries spanning a range of categories including sports, entertainement national and international news. Each summary is written by its in-house team of editors, and includes a single link out to a story with further information.
The company actually went Android-first in India, launching its app 18 months ago. Founders explained that it didn’t have the resources to cover both Android and iOS, and went with the Google-owned platform because “Android has much better penetration in India.”
News In Shorts finally released an iOS app this year, and together its apps have been downloaded over 100,000 times. The company sees 10,000 downloads per week.
STARTUP. WorldRemit Raises $100M To Take On Western Union In Money Transfers
WorldRemit, a UK-based startup that is going after the Western Unions and MoneyGrams of the world with a commission-beating online and mobile remittance service, has raised another $100 million — funding that it will use to continue building out its service globally, and specifically in the U.S., where it has laid down roots in Denver.
The funding comes from new investor Technology Crossover Ventures and existing investor Accel. This is only the second time that WorldRemit, founded in 2010, has raised money: the first time was in March 2014, when Accel put $40 million into the company.
This latest round values WorldRemit north of $500 million.
WorldRemit is still relatively small: it processes 250,000 transactions per month, and has been steadily growing revenues, with $25 million in sales in 2014, compared to $9.3 million in 2013. It says it’s on track to grow at the same rate this year.
But on a wider scale, the remittance market is very big business. The World Bank estimates that by 2016 there will be more than $700 billion sent overseas between family and friends, with $646 billion sent in 2015.
INVESTMENT. Google Capital Is Opening An Office In India
Google is joining SoftBank, Tiger Global and other investors in India, after the company revealed that it is in the process of setting up an office for Google Capital, its year-old late-stage fund, in the Asian country. The outpost will be its first outside of the U.S..
A Google spokesperson confirmed plans to hire an India-based Google Capital representative, although it is not yet clear where that person will be based. Google Capital partner David Lawee told The Wall Street Journal that “it makes a lot of sense to focus on India right now,” citing the growing adoption of smartphones in the country and its increasingly active startup community.
INVESTMENT. 500 Startups Is Raising A $10M Fund In Thailand
500 Startups, the U.S. startup investor/accelerator with a reputation for backing startups across the world, is deepening its efforts in Asia with a new $10 million micro-fund for Thailand. The organization launched a $10 million fund for Asia — ‘500 Durians’ — in 2013, but this new one — ‘500 TukTuks’, named after the iconic mototaxis — is dedicated to Thailand, a country where there are few VC firms.
The fund is not closed yet, but a formal announcement — including details of its first investment(s) — is expected to be made next month.
500 Startups has already invested in more than eight Thai companies via 500 Durians, so now it is doubling down on the country. It plans to use half of the 500 TukTuks fund to invest in early-stage startups — that could potentially involve as many as 67 deals — with the other half allocated to follow-up and later-stage funding.
According to documents, 500 TukTuks will provide an average of around $75,000 as a first investment, usually as part of a seed-stage round with other investors. The fund will cut checks of upwards of $150,000 for follow-on investments in startups “that show signs of becoming big winners.”