Happy Sunday!
It is hard to ignore the current decoupling of public and private markets’ valuation in tech. This is true both from a local and global perspective. Looking at Brazil, while listed tech stocks suffer, everyday we hear a new deal and astonishing valuations in the venture world. In the US, as the Fed tightens monetary policy, public market investors are rotating out of high growth tech companies - and the public software sector experiences the second deepest multiple contraction in the last decade - 52%. The question is when and how this will affect the startup world.
Tomasz Tunguz, venture capitalist at Redpoint, brilliantly discusses the theme in his recent blog post. Astella, Brazilian VC Fund, also wrote a piece worth the read. In a nutshell - markets are interconnected - and we should start seeing soon later stage valuations flattening and falling.
Now – let’s go ahead to the week’s news… Even though it is not LatAm specific, I can’t ignore Microsoft’s move of acquiring Activision Blizzard for USD 68bn this week. If approved, the company will have the wealth of gaming franchises - very important factor in a “Web 3.0 Metaverse” world.
Please bear in mind that these are strictly my opinion, based on my background and personal interests. Feel free to share this newsletter with anyone who might be interested – to subscribe, just click on the link below!
ClearSale, Brazilian anti fraud, announced its first acquisition, Beta Learning, a company specialized in software development (software factory) and corporate and technical software training for BRL 40.1 mm.
My take: By now we all know that one of the biggest challenges in tech is hiring developers in a super competitive enviornment. This M&A is a clear case of acquihire as Beta Learning has 110 employees, with a total of 97 developers.
HASH11, crypto ETF from Hashdex traded in the Brazilian stock exchange, reaches the mark of 130.000 shareholders. After 9 months, the ETF is already the second largest ETF traded in B3 by number of shareholders - shedding light on the theme’s popularity.
According to the recent report published by Sling Hub, Brazil has currently 1,670 fintechs - the number represents a 67% growth when compared to 2020.
Big news for Quinto Andar - the BRL5.1bn firm rebranded this week with the objective of connecting more with its consumers and showing that the Company does much more than a sale transaction - providing solutions after the signing of the contract. The new ad will air on Big Brother Brasil as 5A positions itself as one of the most important proptechs in the region. Currently, the company has BRL 81 bn in leases under management, closing ~ 10,000 contracts every month.
The acceptance of PIX as a means of payment in e-commerce websites have tripled in 2021. Recent research shows that in January/21 16.9% of the online stores accepted PIX, number that climbed to 55.9% in December of the same year.
Sinqia announced the acquisition of LOTE45, financial consulting firm that focuses on third-party asset management through its risk and operational management platforms used by more than 100 firms in the investment fund industry (mainly family offices and asset managers).
Open health: the Brazilian government announced it is currently studying a provisional measure aimed at increasing competition in the health insurance market, by the creation of an “open health” system. It is inspired by the open banking platform — a system conceived by the Central Bank to give greater transparency to the banking sector.
Tabas, company that provides rental services intended for a comfortable stay with fully furnished apartment, raised BRL 80mm in debt and equity for a Series A.
Agrolend, company that aims to revolutionize the agribusiness market for small and medium rural producers in Brazil through the granting of sustainable credit, necessary to finance the development of agricultural production and to encourage investment in equipment and technology, raised BRL 80mm in a Series A round led by Valor Capital Group.
Soon to be closing a pre-IPO private round, fintech Creditas has already started the process for a possible IPO in the US to occur most likely in the second semester of 2022. In current conversations, the company estimates a debut valuation of USD 7 billion-USD10 billion. The Company should raise from USD 500 million to USD 1bn.
Cubo, Itaú Unibanco's initiative to foster innovation and entrepreneurship, will launch a segment dedicated to urban mobility. The Smart Mobility project was born with the partnership of Bike Itau, Vec Itau (electrical vehicles), iCarros and Connet Car.
Two Brazilian edtechs to watch: Resilia and Education Journey advance to the semi final of the biggest Edtech competition in the world - GSV Cup Elite 200.
What am I reading?
Tech Crunch: Funding for women founders continues to disappoint - New data indicates that less than 2% of VC funding last year went to all-women teams.
CB Insights: State Of Digital Health 2021 - Digital health startups pulled in a record-breaking $57.2B in funding in 2021, up 79% from 2020 totals. Funding in all geographies hit record levels in 2021, fueled by the growing need to provide digital solutions and delivery models to patients during the pandemic.
Blackrock: Larry Fink CEO letter
What did I listen/watch?
Quote of the week:
“80% of success is showing up”— Woody Allen
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