Welcome to Ignition Lane’s Weekly Wrap, where they cut through the noise to bring you their favourite insights from the technology and startup world. Ignition Lane works with ambitious business leaders to apply the Startup Mindset to their technology, product and commercialisation problems.
This wrap goes out free to subscribers every Saturday. Don’t forget you can catch Gavin Appel discussing the week on the Startup Daily show on Ausbiz every Monday at 2pm. If you miss it, you can catch up on the week’s shows here.
Here’s their review of the week.
FunTech (kiwi for FinTech)
The largest Australasian series A? Founded just two years ago, Scalapay raised $210m led by Tiger Global at a valuation of neeearly $1b (US$700m). The founders started the buy now, pay later startup from Australia, but quickly realised the local market was saturated and decided to shift focus to Southern Europe. Scalapay now integrates with 3,000 merchants and over 2,000 physical retailers from Italy to Spain. Now that’s global from day one. We think this series A could be the largest Australia has ever seen, coming close to smashing Airwallex’s record for the fastest to unicorn status.
今すぐ購入、後で支払う. PayPal is buying Japanese “buy now, pay later” firm Paidy for $2.7 billion, mostly in cash. Afterpay and Square’s shares were down following the news. Thread on the future value of BNPL:
1/ Why is “Buy Now, Pay Later” (BNPL) an early threat to trillions of dollars of market cap – Visa (almost $500B), MasterCard ($350B), card issuing banks, acquiring banks/services (Fiserv, FIS, Global Payments, etc)?
— Alex Rampell (@arampell) September 8, 2021
You want bitcoin with that? You can now use bitcoin to buy McD’s in El Salvador, after it became the world’s first country to make bitcoin legal tender.
Do you even crypto, bro? A recent Finder survey found that 17% of Australians now own crypto, totalling $8bn (well, maybe a bit less after the price crash on Tuesday). Bitcoin is the most popular cryptocurrency, followed by Ethereum and Dogecoin. One in three Australians believe bitcoin will take over from fiat currency by 2050.
Instant bitcoin. Australian crypto exchange BTC Markets is partnering with Volt. Volt will provide corporate cash management accounts for BTC Markets users to manage their Australian dollar funds, providing near-instant cash-to-crypto trading opportunities. The partnership will eventually allow BTC Markets users to open Volt bank accounts without leaving the exchange.
Battle of the regulators. The U.S. Securities and Exchange Commission (SEC) has warned it will sue major bitcoin and cryptocurrency exchange Coinbase if it launches its new Lend product, which offers interest to be paid on bitcoin holdings. The SEC wants to argue that Lend is a security, and should be subject to securities laws (registration with the SEC, a prospectus, audited accounts, etc). From Bloomberg’s Matt Levine:
In general the thing that is happening now in the crypto world is that it is rapidly recreating the things that exist in the traditional finance world. [For example Lend is like a savings offering:] “Earn interest on your savings” … And of course it would be nice, for crypto companies, to re-create banking without bank regulation. But you can see why regulators wouldn’t like it.
Relatedly, Coinbase Ventures was the third most active corporate VC in the first half of 2021. Founded in 2018, it already has 11 companies in its portfolio valued at over US$1bn.
Meanwhile in Aus… In October an Australian Senate committee is set to issue recommendations on how blockchain and cryptocurrencies like bitcoin should fit into Australia’s financial regulatory landscape. Some have expressed concern at the lack of clarity in rules around digital assets. Others, including Afterpay, are pushing hard to prevent regulation from stifling innovation. It’s a delicate balance.
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Afterpay submitted to the Senate committee that crypto-based payments could cut costs for merchants by avoiding card fees (unlikely if Mastercard has its way – more on that below). It said it is actively “considering” how innovative fintech features, such as crypto payments, could function within Afterpay. It also recommended that the government work to create a framework for an AUD-backed stablecoin. All of this is not surprising, particularly given Afterpay’s likely acquisition by Square, which is heavily investing in bitcoin and decentralised finance products.
Clipping the digital ticket. Mastercard acquired crypto intelligence and security firm CipherTrace for an undisclosed amount. It wants to use the startup’s analytics capabilities to enhance crypto security and fraud detection. Mastercard has been moving deeper into crypto this year: it launched a crypto accelerator program, partnered with a digital lender and crypto exchange to offer crypto rewards cards, and announced it will support cryptocurrency payments.
New bank, who dis? Avenue Bank has been granted a restricted banking licence by Australia’s financial regulator. The approval means Avenue can offer short-term working capital lending to SMEs. The neobank is hoping for a full licence by mid-2022.
Fixed income blooms. Blossom hit $10m funds under management after being on the market for just 3 months. Founded by Gaby Rosenberg only two years out of university, Blossom provides Australians with a simple way to invest in fixed income assets, which would usually only be available to institutional investors like hedge funds. Blossom is backed by Gleneagle Asset Management and aims to provide a 3% p.a. return, without zero fees or term commitment.
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Other local newsing
Microsoft buys a new Clippy. Microsoft is acquiring Queensland video startup Clipchamp, “welcom[ing] them wholeheartedly as kindred spirits.” Namaste, Microsoft. Clipchamp is an in-browser video creation and editing experience founded in 2013. Offering ready-to-use templates within a flexible video editor that compresses and converts videos, investor Steve Baxter describes it as “Canva for video.” Word.
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Australia’s first national biotech incubator. The federal government has granted $40m to a Brandon Capital-managed Medical Research Commercialisation Fund (MRCF) to help commercialise promising research into new therapies. The MRCF is a collaboration of leading medical research organisations, hospitals and superannuation funds in Aus & NZ. Half of the funding will help promising preclinical biomedical technologies get investment ready. The other half will support the clinical development of novel therapies to treat disease.
If you’re interested in working in HealthTech, our friend Emily Casey rolled out a new What the Health jobs board. Get amongst. And while you’re at it check out her newsletter.
Reining in the bullies. Australia’s High Court ruled that newspaper publishers can be held liable for comments made by members of the public on their Facebook pages. The ruling has come about as a result of a case brought by Dylan Voller who wants to sue certain media companies in the NSW Supreme Court over alleged defamatory comments on their Facebook pages. There’s now a risk that media companies will turn off comments if they can’t be bothered moderating them. Maybe that’s not a bad thing if it prevents online bullying?
Envato is building out its NZ presence. It now has 17 staff working remotely across Aotearoa and expects that number to double by the end of the year.
Drugs on demand. Chemist Warehouse is the latest retailer to strike a partnership with DoorDash to deliver pharmaceutical products to customers within 24 hours.
Proof that…
- Anything can be sold online. Glasses retailer Bailey Nelson is using Plattar’s AR tech to allow customers to virtually try on glasses, increasing conversions by 400% in Australia and more than 600% in Canada.
- You can find amazing women Directors. Atlassian now has three women on its board (including its Chair), after appointing cofounder, COO, and President of Cloudflare, Michelle Zatlyn as its latest Director.
- Cremorne is the startup hub. The Vic government is backing the Australian Sports Innovation Centre for Excellence with a $4m investment to create an innovation centre in Cremorne.
Show me the money
Willow raised US$43m (valuation US$170m+) from existing investors for its digital twin platform. Digital twins are digital representations of physical assets (e.g. train lines or buildings) overlaid with real time data on how those assets are performing.
All G Foods raised $16m, including $5m through the federal government’s Clean Energy Finance Corporation (CEFC). The Sydney-based startup is developing alternative proteins.
Azupay raised $10m from Ellerston Capital. Azupay is the first fintech to offer an Australian made consumer-to-business payment solution using the New Payments Platform (NPP) and PayID.
Unleash live raised $8m led by SafetyCulture. Its software helps companies increase safety and reduce costs by using video analytics on streamed visual inspections.
Verrency raised $6.5m led by the Salter Brothers and Perennial. Its tech enables banks to offer functionality like rounding up purchases to donate to a charity or send to a savings account, or offset the carbon footprint of transactions.
Carina Biotech raised $5.4m led by Minderoo Foundation. Adelaide-based Carina Biotech will use the cash injection to develop its “CAR-T” cell therapies to treat cancers such as colorectal cancer.
CarClarity raised $3m led by EVP for its car loan offering and to “pioneer” a new online car buying service.
Yabble raised NZ$3.2m from Movac, NZ Growth Capital Partners and its existing investors. It says its hero product, Hey Yabble, is the world’s first automated customer insights platform. Hey Yabble takes a brand’s data and tells them how customers feel about their products and services in remarkable detail and almost real-time.
Remote Social raised $1m led by Black Nova VC. It is building what it calls its Culture-as-a-Service offering, which includes remote culture activities, tools, and a marketplace of experiences for teams.
Shouta raised $1m. The app, which launched in December 2020, allows users to instantly gift or ‘Shout’ any contact on their phone by sending them a link to a digital, prepaid Shouta Mastercard.
Steppen raised $535k. Steppen says it has combined all the best elements of social media, workout apps and TikTok to help make working out more easy, more fun and more social! The app is free.
Moxion raised an undisclosed amount from Punakaiki Fund. Moxion provides services to the movie and TV series creation industry. Its workflow for filmmaking is used by the world’s leading filmmakers.
VC/PE land
Pitch Venture Capital aims to raise its first fund – a $2m fund to back 100 founders with $20k each.
Lux Group (Luxury Escapes) is looking to raise $60-100m via ASX-listed PE firm, Auctus Asset Management. Auctus will set up a new fund for the investment, which will be open to wholesale, family office and sophisticated investors (investing in the ASX firm will not give you a piece of the Lux equity pie). This will be Lux’s first external equity capital raise since it was founded in 2009. It was forecast to turnover $500m in 2020, before Covid hit.
On the socials
All-seeing Facebook. Facebook has copied yet another product idea from Snap. Shock horror. This time, a Snap Spectacles clone – Ray Ban Stories. The glasses have a built in camera, microphone, speakers and touch panel. Just what the world needs.
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Risky move putting Zucks on the ad. The kids really don’t think he’s cool.
Twitter is the new facebook. Twitter is testing a new feature similar to Facebook Groups called Communities, where people can tweet just to a group (rather than their entire follower base). It is also testing “edge to edge” tweets that, a la Instagram, span the width of the timeline “so your photos, GIFs, and videos can have more room to shine”.
The party is cancelled. Remember Houseparty? That video chat app you (and 17 million other people) downloaded in March 2020 as the world went into lockdown, and then never used again? Well, it is shutting down. Owner Epic Games is sunsetting the party to focus on other projects.
When ex-Apple, Beats and Uber people build a webcam:
We quietly backed a team (from Apple, Beats, Uber) reviving a forgotten corner of consumer tech
The beta arrived today and the quality
is mind blowing…Webcams, welcome to 2021. pic.twitter.com/xYe1APRMCX
— AlexisOhanian 7️⃣7️⃣6️⃣ (@alexisohanian) September 8, 2021
That’s a wrap! We hope you enjoyed it.
Bex, Gavin and the team at Ignition Lane
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