I have been researching about diversity in the workspace this past week. I therefore came across a study by McKinsey and LeanIn, an international organization supporting professional equality, called "Women in the Workplace 2023 . The results were quite stunning. While it is true that it covers only the U.S. and Canada, its implications resonate across the world, including Latin America. One striking statistic from the study reveals that for every 100 men elevated to managerial positions this year, only 87 women received similar opportunities. Undoubtedly, we have achieved significant milestones in recent times. However, it is clear that our journey towards full workplace equality is not yet complete...
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Shifting gears to the usual market update, a very interesting read this week was Pitchbook’s Emerging Tech Research note on the trends seen on recent tech IPOs in the U.S. The results have been a mixed bag, with seven major US-listed IPOs showing varied outcomes compared to the Nasdaq since their offerings. Klaviyo is up by 6.9%, RayzeBio by 16.3%, Arm by 12.8%, and CAVA by a notable 61.2%, while Instacart, Oddity Tech, and Birkenstock have seen declines.
Klaviyo's IPO success can be credited to its strong revenue surge, securing a valuation on par with its last private valuation despite an increased offering range. Valued at 18.5x its trailing twelve-month gross income, it overshadows Braze's 16.9x. However, Klaviyo must sustain growth, particularly over the next three years, to hit significant revenue milestones.
Arm's promising growth outlook has earned it a high valuation, with anticipated revenue increases of 11% in fiscal 2023 and about 25% in fiscal 2024, leading to an expected $1.5 billion in adjusted EBITDA. This places its value at a moderate premium compared to similar companies.
Instacart, on the other hand, confronts both challenges and opportunities in revenue growth. With a slight drop in US online grocery sales in the first half of 2023, the company must innovate to sustain growth. Although advertising has offset some losses, Instacart will need to further exploit this avenue for additional revenue.
Despite different performances, one common aspect made clear to investors is that in the current economic landscape, the journey towards consistent profitability is crucial. This is a marked shift from the SPACs between 2019 and 2021, for example, many of which are projected to operate at a loss until 2025 or later.
Shifting gears a bit, another insight is that currently public markets are looking expensive again relative to private markets. Trading multiples on the S&P 500 are more than twice those seen by mostly private M&A deals on an EV/revenue basis. The spread has widened to where it was prior to the massive take-public wave of 2020 and 2021.
General news:
Sensedia, the Brazilian company that delivers API solutions for businesses, and Mambu, the European cloud-native core banking platform, announced a partnership to provide advanced API management and modern banking solutions for financial institutions.
a16z is gearing up to raise $3.4 billion total for an early-stage fund and a seed fund. If it succeeds at hitting its target, this set of funds will be 17% larger than its previous pair.
Flourish Ventures, the California-based early-stage fund with a focus in US and emerging markets, secured $350 million in capital. Among its previous investments is the Brazilian neobank Neon.
Japan is set to invest USD$13 billion in regions such as Latin America. Japan’s Minister of Economy, Trade and Industry, Yasutoshi Nishimura, stated that the JPY$2 trillion (USD$13.3 billion) will come from investments by Japanese companies backed by public aid.
Domo.VC, Brazilian venture capital, is entering a new phase and will raise proceeds from abroad for the first time.
Deals:
Jusbrasil, Brazilian technology company in the legal sector, raised $86.10 million of venture funding from Warburg Pincus.
Krealo invests in Colombian startup Plurall, promoting financial inclusion and backing innovation with artificial intelligence for micro-entrepreneurs in Latin America. Amounts were not disclosed.
Food To Save has just raised a round to scale its platform, entering new cities and acquiring new users in the markets where it already operates. The funding of R$ 14 million was led by DSK Capital and included the participation of the management companies Spectra and HiPartners.
Six months after the seed round, Jobecam raises an additional R$ 2 million. The HR tech company was selected in a program by BID Lab, the innovation lab of the Inter-American Development Bank.
General news:
Eletromidia has disclosed soft results for the quarter. However, the company witnessed a more favorable trend in the third quarter of 2023 as opposed to the second, with gross revenue growth picking up from zero percent year-over-year in Q2 to nine percent in Q3. It's suggested that, under more robust economic conditions and with additional events like "The Town" in the third quarter, Eletromidia might have reported even stronger figures.
Deals:
QI Tech secures R$ 1 billion with General Atlantic and prepares for M&As. In the biggest round of the year, the fintech attracts General Atlantic to its shareholder base and seeks acquisitions to boost its EBITDA, all while gearing up for an initial public offering.
Vaas raises USD$2 million to fight financial frauds. The startup, which is still in a proof-of-concept phase with large enterprises, does not plan to officially launch its blockchain transaction tracking platform until next month.
Monuv, a startup specializing in SaaS and AI solutions for camera surveillance, has just bolstered its funding. In a bridge round co-led by Indicator Capital and Invest Tech, the startup raised an additional R$ 8.5 million.
General news:
Itaú BBA will gather prominent figures from Brazil and abroad to discuss the economic landscape, business, and investments. Macro Vision 2023, which will happen on November 9, will feature the participation of individuals such as Richard Clarida, former Vice Chairman of the United States Federal Reserve, and business leaders Abilio Diniz, Eugênio Mattar, and Rubens Ometto Silveira Mello, alongside key leaders from Itaú. If you want to watch it online, click here.
Quarterly corporate venture capital (CVC)-backed funding has fallen 73% from its all-time high ($48.6B) just 2 years ago.
Magical announces USD$5 million fund for LATAM startups. This fund has allocated resources of up to USD$100,000 to support emerging companies seeking to grow during the period covering the remainder of 2023 and part of 2024.
Deals:
Verqor raises USD$7.5 million to digitize agricultural sector. Accion Venture Lab, SP Ventures, Glocal and Amplifica Capital also participated in the round. The startup also raised an additional USD$3.5 million in debt financing from Co_Capital and Addem Capital.
General news:
Brazilian insurtech company 180 Seguros showcased its own artificial intelligence (AI) solution at InsurTech Connect (ITC) in Las Vegas, named "Sagas Buddy". The tool has been developed in collaboration with Google.
Deals:
DM Card's proposed acquisition of Credz transitioned from non-binding to binding, providing relief regarding the company's continuity. DM signed a binding memorandum of understanding (MOU), sent to all Credz creditors.
Energy Master, developer of an intelligence software intended to empower corporations to make the best decisions on utility consumption raised $5 million of seed funding from undisclosed investors.
Pacific Time, operator of a cybersecurity company intended to minimize the impact of cyber-attacks in various areas of business in the world, raised BRL 10 million of Series A venture funding from Gear Ventures and other undisclosed investors.
General news:
The Ukrainian edtech Mate Academy arrives in Brazil with an employment-based payment model. Mate Academy launches programming courses in Brazil with deferred payment model tied to students’ employment success.
Deals:
Their business is to ensure the scheduling of a medical appointment with a good doctor within 48 hours. São Paulo-based startup Melvi has raised $9.8 million from funds like Kaszek and Canary to address a dilemma faced by many Brazilians: finding a healthcare professional with excellent credentials and an accessible schedule.
Finkargo, developer of an import financing platform designed to accelerate and finance international trade operations for SMEs in Latin America, raised a $20 million Series A venture funding in a deal led by QED Investors. Quona Capital, Maya Capital, ONEVC, Flybridge, and Nazca also participated in the round.
The study is based on a sample of 2,453 companies registered in Gupy's database, which were analyzed from September 2022 to August 2023 in Brazil. Below you can see some of the key takeaways:
Self-declared white and brown people have more equitable percentages in companies of all sizes;
Over 99% of hires across all sizes, sectors, and regions are people who primarily identify as female or male;
Hires are more concentrated among individuals who are part of Generation Y and Z (over 90%);
Although there are laws supporting the employment of people with disabilities (PCDs), companies with more than 200 employees still have low numbers of hires from this demographic.
