Cryptocurrency is facing real regulation threats. Thousands of cryptocurrencies are now traded 24/7 around the globe, without many rules to oversee it. Many countries, including the United States, want guardrail protections. Last week, SEC Chairman Gary Gensler said the Commission would try to maximize regulatory protection of the "Wild West" of crypto. Gensler wants crypto to be regulated in the same way the SEC oversees securities (like: stocks, mutual funds, and bonds). Crypto markets and cryptocurrency exchanges don't have the same controls and protections as the stock market. No single regulator oversees them. This is because most cryptocurrencies are classified as commodities, not securities. So, they're not under the purview of the Securities and Exchange Commission (SEC). Gensler believes many cryptos function like unregistered securities – and should be SEC-regulated as soon as possible.
The total market cap of cryptocurrencies skyrocketed this year, as coins like Bitcoin, Ether, and Dogecoin gained mainstream appeal. That's also led to more volatility, crypto scams, and money laundering. Now, more countries are considering crypto regulation — or are already enforcing it. The SEC wants to protect crypto investors against fraud and manipulation. That could mean crypto becomes less anonymous — and more regulated. The EU already proposed tightening rules on crypto transfers to make sure they're traceable. Meanwhile, India has been considering a crypto ban for quite some time. Because of its limited purview, the SEC’s strategy has centered on suing token sellers case-by-case. Gensler is calling on US lawmakers to grant the SEC more power to oversee the industry. But regulation could take years.
Cryptocurrency being unregulated, decentralized, and hard-to-trace nature is core to its identity. Some enthusiasts want it to stay that way. But Gensler and some companies believe crypto's survival depends on regulation. Gensler says that just like traffic lights and speed limits helped make cars mainstream, oversight could boost trust in crypto and allow it to grow. Still, we don't know whether regulation might happen — or what it might look like if it does. But with the rise of meme crypto causing price volatility and Robinhood prioritizing risky coins like Dogecoin, it may only be a matter of time before cryptocurrency oversight is a reality in the United States or worldwide.
As the Delta variant spreads, Covid restrictions are cropping back up around the world. The CDC recommended re-masking indoors. Half of California is back under mandatory indoor mask mandates, and NYC is requiring proof of vax status for some indoor activities. Meanwhile, Home Depot, McDonald’s, and Target are requiring many workers to mask up again. The chances of more lockdowns are low, but investors are worried Delta will slow the recovery.
The US unemployment rate is 5.9% — nearly double pre-pandemic levels. But there are still more jobs than job seekers, and employers are struggling to hire. Some reasons workers aren't returning: Covid fears, child care needs, and boosted unemployment benefits.
Now, companies are doing more to sweeten the pot for their employees. Target and Walmart will pay 100% of college tuition for their workers. And CVS is boosting its minimum wage over the next year to $15, the target number of most Democrats in previous legislative attempts to raise national minimum wage.
Airbnb has been resilient during the pandemic by embracing the work-from-anywhere life. It added a new feature that allows renters to search for flexible dates and destinations — including boats, farms, and even shipping containers. Last quarter, Airbnb's sales even beat pre-pandemic levels, as you staycationed in a yurt. We'll see if that favorable trend continues when Airbnb drops earnings on
The company 23andMe drops earnings on Friday — its first checkup as a public company. Shares of the home DNA testing company have plunged 20% since its February IPO, as fewer people bought its ancestry and health kits. But it’s building a longer-term revenue stream: partnering with pharma companies like Genentech and GlaxoSmithKline to develop drugs with its trove of genetic data.
Rihanna just gained billionaire-status thanks to her 50% stake in Fenty Beauty, as the celeb-preneur biz model thrives. You too can be a boss-lady billionaire! Jack Dorsey’s Square dropped $29B on acquiring Afterpay, because "buy now, pay later" is Zillennials' favorite option. Shine: Reese Witherspoon sold her female-driven production company Hello Sunshine for a reported $900M, as the content wars intensify.
Fueled by rapid consumer adoption of restaurant and grocery delivery services, the foodtech vertical delivered another strong quarter in Q2 with startups around the world raising $6.2 billion across 280 deals. Our latest Emerging Tech Research report explores VC activity in the foodtech sector, highlighting key deals, exits and industry opportunities in the food delivery market. Key takeaways include: Ecommerce-focused food suppliers led Q2 funding with $3.1 billion invested across 29 deals. Ultrafast grocery, the latest online food delivery trend, is characterized by startups offering 20-minute-or-less delivery of goods, betting on consumers who prefer spontaneous food orders over trips to the store. The latest protein to garner VC attention is microalgae. Several corporate food companies have formed partnerships with microalgae providers to develop new plant-based products and reduce their carbon footprint. The food delivery market in India is estimated to exceed $21 billion by 2026. As the market is large and under-penetrated, it is believed that ghost kitchens will play a greater role in the development of India's food delivery market.
Over the past decade-plus, venture capital investors have been searching for the next Silicon Valley. And the COVID-19 pandemic accelerated the hunt, with industry heavyweights touting the benefits of moving to cities that embrace tech culture. Collin Gutman, co-founder and managing partner at SaaS Ventures, joined the "In Visible Capital" podcast to discuss what it takes to grow venture ecosystems in cities outside traditional tech hubs, and why he's more bullish than ever on the future of tech. The episode is sponsored by Vanta. Topics include: How Miami has emerged as a destination for tech companies and VC, and what other cities could soon follow suit. How a mix of state-run funds and private capital can contribute to building a startup ecosystem. Why institutional investors should think about geographical diversity when teaming with startups.
Caribou Biosciences, a UC Berkeley spinout, uses a CRISPR-based approach to develop "off-the-shelf" therapies and potentially broaden the use of engineered immune cells in cancer treatments. The company recently raised $304 million. Caribou Biosciences (NSF-1315621) is one of hundreds of deep tech startups funded annually by the National Science Foundation, a government agency that plays a central role in accelerating discoveries into the marketplace. Each startup can receive up to $2 million to support translational research and development. NSF helps teams navigate the earliest stages of technology translation, investing roughly $200 million annually in startups. In the last five years, these companies have gone on to raise billions in follow-on capital, and the portfolio has had 100-plus exits.
Moove, a provider of revenue-based vehicle financing services for drivers in Africa, has collected a $23 million Series A co-led by Speedinvest and Left Lane Capital. The company also announced it has raised $40 million in debt. The Nigerian startup, which caters to the continent with the lowest per capita vehicle ownership in the world, is Uber's exclusive car financing and vehicle supply partner in sub-Saharan Africa. Clocktower Technology Ventures and Spartech Ventures also participated in the funding, among others. Moove is the latest entrant in the African fintech market to attract investor attention in 2021. Fintech startups in the region have secured around $330.5 million in H1, more than double the amount raised the entire year before, according to a report from Disrupt Africa, a tech-focused research and news organization based in the continent.
GP stakes deals have surged in popularity over the past five years, with tens of billions of dollars flowing into the strategy. Yet the blistering growth has some industry observers questioning its future—and what investment prospects may remain. Plenty, as it happens. GP stakes deals are in a lush opportunity landscape, with $100 billion-plus in potentially available value, our analysts argue in our recent research note. Among the takeaways: The middle market offers the best supply-and-demand dynamics compared to larger or smaller GPs, with less than $10 billion currently targeting the space and over $40 billion in capacity. Buyout firms have long been the favored choice for GP stakes investors, yet growth equity targets have become increasingly attractive based on their return profiles, fees and holding periods. Private capital managers are opting for more IPOs, signaling a change in how they view outside ownership. More may be willing to sell stakes—or the top end may have less capacity than expected if firms go straight to the public markets.
SoftBank's decision to halt investments in China is likely to add fuel to the investment firm's push into less developed markets around the world. Chinese startups have long been a cornerstone of SoftBank's portfolio, but their influence is waning. Just one in 10 new deals have come from the country this year. The Japanese investor remains significantly exposed to Chinese tech. Regulatory headwinds from Beijing have battered the stocks of portfolio companies like Beike and Full Truck Alliance in recent months. In the long term, SoftBank CEO Masayoshi Son is bullish on the potential for Chinese innovation, especially in artificial intelligence.
Pets and animal health are big these days so let's unpack some companion animal investment opportunities. Pet ownership has been steadily rising in recent years as people around the world brought companion animals into their homes. Against the backdrop of the COVID-19 pandemic, even more consumers became pet parents. At the same time, a growing public interest in health and wellness has spilled into the animal world, and humanization of pets is on the rise. Pet and animal health sector valuations are up as a result, and for private equity and strategic buyers in the space, competition for assets is at an all-time high. For many, a buy-and-build strategy brings advantages of geographical diversification, an ideal channel mix or economies of scale within specific subsectors.
Sports merchandise website Fanatics has reportedly reached an $18 billion valuation following a new funding round that continues a trend of investors willing to wager on sports media and sports-betting companies. Fanatics landed the $325 million from existing backers like Major League Baseball, SoftBank's Vision Fund and Silver Lake, as well as new investors including Jay-Z and his entertainment company, Roc Nation, The Wall Street Journal reported. The Jacksonville, Fla.-based company reportedly plans to use the new funding to create a digital umbrella platform with multiple business channels, including ticketing, media, sports betting and internet gambling. The financing highlights a recent trend of deals in the sports-betting sector. Within the past week, sports-betting giant DraftKings reportedly struck a deal for Golden Nugget's online gaming business for $1.56 billion, and Penn National Gaming agreed to purchase Score Media and Gaming (TheScore) for $2 billion in cash and stock.
Ecommerce platform Trendyol has raised $1.5 billion at a valuation of $16.5 billion, making it Turkey's first decacorn. The round was led by General Atlantic and SoftBank's Vision Fund 2. Princeville Capital and two sovereign wealth funds, Qatar Investment Authority and the UAE's ADQ, also participated. Trendyol has more than 30 million users and delivers over 1 million packages per day including groceries, clothes and electronics. It also offers logistics and payment services. The company, founded in 2010, also raised $350 million in March from Alibaba. VC activity in Turkey was largely stable over the past decade, but a handful of big deals have driven 2021 to record levels for capital invested. Aside from Trendyol, rapid grocery delivery startup Getir raised two mammoth rounds that reportedly totaled over $850 million in the first half of the year. Mobile games developer Dream Games also closed a $155 million Series B in June.
More and more people are flocking to the once-exclusive world of angel investing as part of a wider boom in ever-riskier investments. Cruise companies, cinema operators and retailers are watching their bond prices fall as US investors back away from debt in light of Delta variant concerns. One writer questions whether fintech companies are really as ethical as they may seem.
Stay tuned and subscribed to the Frugal Finance Blog for more financial news now!
