INTELLI Weekly Round Up
Friday September 16, 2022 | Volume 1 Series 5 | US VC Valuations Report, Figma acquired by Adobe, Uber gets Hacked
*Freebie!* On randomly-selected Fridays, we remove all paywalls and let our free subscribers get a sneak peak at what an (lighter version of an) INTELLI newsletter is packed with!
What a wild week it’s been in the venture space, with Uber getting hacked all the way to Figma getting acquired by Adobe in a deal that took everyone by surprise due to the fact that it was 50x their revenue. Let’s take a closer look into the INTELLI Insights for these, but first, we’ve got a special report to share with you and a new video about INTELLI!
PitchBook Q2: US Valuations Report
📌 US VC Valuations Report for Q2 📌
Different outcomes for different stages of US VC valuations 👇
In Aug, Pitchbook released its latest report on the US VC landscape during the second quarter (we’ve attached the PDF below).
Some key takeaways:
Early-stage
⬇️ The median pre-money was $52.0 million, exhibiting a 16.1% decrease from the Q1 2022
Seed-stage
➡️ It held up better than any other stage, with deal counts and sizes remaining elevated and median pre-money valuations up 33% this year over 2021
Late stage
⬆️ The median pre-money valuation for late-stage deals was $110 million, a 10.0% increase above the 2021 full-year median of $100 million
A key observation was made regarding the behavior of non-traditional investors - their investment in late-stage startups declined compared to Q1. We’ve attached the full report below. In only 23-pages, it contains interesting graphs regarding the VC landscape in the US. I’d recommend you give it a look.
Access the PDF version here via INTELLI Insights
Another great resource: The Revolution of Banking-as-a-Service
Written by senior leaders at Bain, the article outlines how integrating payments and lending services into online products (1) creates better user experiences, (2) opens new revenue opportunities, and (3) increases global GMV. A recommended read for any digital goods or services providers.
Uber was hacked in a massive attack yesterday. Normally, insurance covers these types of wild situations except for the fact that in this case, Uber was warned three days ago and decided to not take heed of the warning thinking it was a joke.
“They pretty much have full access to Uber,” said Sam Curry, a security engineer at Yuga Labs who corresponded with the person who claimed to be responsible for the breach. “This is a total compromise, from what it looks like.”
INTELLI Insights spoke to a PreIPO team member’s friend, who told INTELLI that “yeah that was primarily centered around the fact that Uber was being accused of not paying its driver community fairly,” which is an age-old adage that we hear often.
Design giant Figma was acquired by Adobe in the deal that was announced yesterday, for ~50x their revenue. Obviously, the Instagram community was quick to respond with hilarious memes.
Big news out of Singaporean bank DBS - they’ve opened an office in a new part of the world: the metaverse in an attempt to promote ESG. Read more about their plans here.
FinTech giant CommonBond is shutting down after 10 years of operations.
Over the course of their journey, they accomplished:
*$5B+ in loans funded
*$1B+ in savings for consumers
*1M users and 100K customers served
*$2.5M+ donated to their “Social Promise”
*50 Most Innovative Companies in the World (Fast Company, 2018)
CEO David Klein stated in a lengthy LinkedIn post that “…we were still scaling, not yet profitable, and needed new capital. Unfortunately, we couldn't pivot the entirety of the business fast enough.”
INTELLI Insights
INTELLI Insights: Deep Dive on Revolut
(Est. Valuation ~$33B)
Company name: Revolut
Why Revolut matters right now:
As per Finder over 27% of British adults have opened an account with a
digital-only bank and this number is expected to reach 36% (19
million) by end of 2022.
Revolut’s mission is to unlock the power of a borderless economy, for
everyone. Revolut currently, has 20m+ users, 950k business users, and
200+ countries and regions supported with 30+ in-app currencies.
INTELLI 'hot takes' on Revolut:
Revolut is a rapidly growing banking app, and its founders aim to
become the banking super app. Currently, Revolut is under pressure due
to “Material Misstatement” in Auditing Report.
They have received a crypto trading license from CySEC to allow its
European customers to trade and hold cryptocurrencies.
A closer look at Revolut:
Problems with Revolut:
As a Digital-only bank, Revolut also has difficulty operating over the
internet and fighting hard to earn the trust of its customers.
These are some of the few major concerns customer faces with Revolut.
Customer accounts can be frozen due to security reasons, no current
accounts are available, and customers are complaining about its poor
customer support. Apart from these customer complaints registers over
review sites as losing money due to hacking or some unknown reason.
Potential solutions that Revolut could take:
Focusing and investing more in customer support can reduce most of the
issues presented above. And improving its security and auditing
process to create a more seamless user experience for its customers.
Key things "coming up" / things that might come up in the near future
for Revolut:
Revolut acquired a CySEC crypto license to allow its customers to
trade and hold up to 80 cryptocurrencies. Under this license, Revolut
plans to roll out this feature to 27 European markets.
Revolut started offering unsecured personal loans in Romania 2 years
after its debut in Romania. Romania is the 4 European market Revolut
launched the credit product after Poland, Lithuania, and Ireland. (The
Paypers).
INTELLI's predictions on Revolut's next moves or steps:
It will expand its market share in the cryptocurrency space with its
CySEC license.
Also, recently published in Financial Times on 5th September 2022.
Regarding Revoluts Audit flaws. UK regulator highlighted an
“unacceptably” high risk of “Material Misstatement”. This could
possibly lead to civil penalties against the company itself under UK
law.
“The entity intended to house the UK banking license applied for by
Revolut in January 2021, but which it still has not received”.
(Financial Times)
Opportunities that Revolut has:
It will expand its market share in the cryptocurrency space with its
CySEC license.
Also, recently published in Financial Times on 5th September 2022.
Regarding Revoluts Audit flaws. UK regulator highlighted an
“unacceptably” high risk of “Material Misstatement”. This could
possibly lead to civil penalties against the company itself under UK
law.
“The entity intended to house the UK banking license applied for by
Revolut in January 2021, but which it still has not received”.
(Financial Times)
Things that could pose a risk to Revolut:
Laws and Regulations are one of the major concerns for a fintech firm.
Currently, Revolut is under pressure due to “Material Misstatements”
in its Audit report.
What the Revolut 'haters' could/would/are saying:
Revolut is still not a digital bank at least it is not there yet. It
doesn’t provide loan services or current accounts across the country.
It is simply like a budget tool or an occasional app for travelers. By
the way, it was the original Idea of the founder.