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Hello and welcome to Daily Crunch for Wednesday, May 26. Yes, we’re going to get to the huge Amazon-MGM deal, but we have to chat about a startup first. Have you heard of Poparazzi? If you have kids you might have — it’s the latest social phenom. And it just ran its way up to the top of the App Store. (Too bad it’s not Puparazzi!)
Yes, I feel old as well. Take a look if you want to know what the kids are up to. Now, the rest of the news. — Alex
Table of Contents
The TechCrunch Top 3
- Amazon snaps up MGM: The biggest news out today is the giant Amazon-MGM deal worth more than $8 billion. Its studio purchase helps cement Amazon in the mix of tech companies with huge investments in the online video space. Observers believe the e-commerce giant plans to use MGM to bolster its Prime service, making consumers less likely to churn thanks to the inclusion of more services. Which rings hollow to us: Who is going to give up Prime, but be swayed by movies? The connection to shipping speed feels tenuous.
- The global fintech boom: This morning, Clara announced a new round, mere months after it raised its preceding round of capital. The Mexican startup works in the corporate spend market, a startup niche that recently saw a $2.5 billion exit in the United States, and more capital for both Ramp and Brex. Our read here is that many nascent fintech formulas that work in the U.S. are going to have wide remit globally.
- IPOs are back: The recent Flywire IPO pricing (strong) and first-day trading (even stronger) are indicative that the temporarily slowed public-offering market is back. So, Robinhood, let’s go?
Startups and VC
Here are five of the tastiest venture capital rounds that TechCrunch covered, showing off an array of niches and round sizes:
- UK’s Paysend raises $125M for mobile B2B payments: You are excused for wondering if every fintech round these days involves both companies and payments. I feel the same way. But what matters in the case of Paysend is that its model to provide SMB online payment services is happening from a post-Brexit U.K. Not even a tectonic decoupling can stop U.K. fintech, it seems.
- Yalo raises $50M for conversational commerce: Here’s a tech startup round that typifies the year. Did it raise less than a year ago? Yes. Did the company have funding find it, as opposed to the other way around? Yes. And did COVID accelerate its business? Yes. Yalo is a wager that the way we buy online is changing, a technology story if we’ve ever heard of one. And it’s one that venture capitalists are lining up to bet on.
- Skiff raises $3.7M for encrypted Google Docs: That’s the pitch, per our own Zack Whittaker. Essentially, Skiff mimics the familiar features of Google Docs, but with end-to-end encryption. As a fan of privacy, I dig the project.
- Treet raises $2.8M to help brands resell their own stuff: The online resale market is huge. ThreadUp is public now, as is Poshmark. But Treet is betting that there is still room in the market for more tech, namely its plan to get brands involved in their own resale market. It isn’t the richest startup around, but given the sheer number of brands out there, it has a pretty huge TAM to grow into.
Finally, African fintech OPay is in the process of raising a huge new round. The investment could help push the continent’s 2021 venture capital totals to new heights, based on data TechCrunch reported earlier in the week.
7 questions to ask before relocating your startup to Florida
Cities like Miami, Pittsburgh and Austin have been drawing talent and wealth from Silicon Valley for years, but the COVID-19 pandemic accelerated the trend.
In recent months, many investors and entrepreneurs have noisily departed for Miami, citing the region’s favorable business climate and quality of life. It’s always good to consider one’s options, but before booking a moving van for the Sunshine State — or any emerging tech hub, for that matter — here are some basic questions entrepreneurs should ask themselves.
(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)
Big Tech Inc.
We’re not going to touch on the Amazon-MGM deal more here in the Big Tech section, leaving us room for all sorts of other news:
- Facebook is looking into allowing users of both the Big Blue App and Instagram to hide social like counts. Which is great for your mental health, we suspect, if awful for those of us with overdeveloped competitive urges.
- Visa is rebounding from its pre-nuptial breakup with fintech unicorn Plaid by building a vetted list of fintech startups that its friends and other customers may want to leverage. In a sense, it’s a way for startups to get a stamp of approval from Visa, and possibly more clients in the process. What’s in it for Visa? More digital payments. That’s good for a company that does lots of payments work, we reckon.
- GM and Lockheed are working on the next American lunar vehicle. It is very, very American to have the progenitors of the consumer Hummer and various weapons of death build our next extraplanetary go-kart. And it’s good that we may go back to the moon? It’s more than time.
To round out the Big Tech section today, OpenAI is out in the market with a $100 million fund to invest in startups. And Microsoft is partnering with the company and putting funds into the capital pool. It feels like ages ago that Microsoft told me that it wasn’t getting into the VC game because the returns would not prove material to its asset base. That wasn’t the point and the company seems to have figured that out.
TechCrunch reports that OpenAI’s Sam Altman of Y Combinator fame said that the fund “plan[s] to make big early bets on a relatively small number of companies, probably not more than 10.” Something to watch out for.
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