Amazon to Buy MGM Studios for $8.45 Billion - Daily Crunch

Daily Crunch: May 26th Edition

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Poparazzi and the Latest Social Trends

Greetings, and welcome to today’s Daily Crunch for Wednesday, May 26th. While the substantial Amazon-MGM agreement will be addressed, a noteworthy startup deserves initial attention. Have you become acquainted with Poparazzi?

The platform has rapidly gained traction as a current social media favorite, particularly among younger users. It recently achieved the number one position in the App Store rankings.

A Note on Generational Shifts

The emergence of platforms like Poparazzi can be a reminder of evolving digital landscapes. Observing these trends offers insight into the preferences of younger demographics.

Amazon and MGM: A Major Deal

Now, turning to other news, the Amazon-MGM acquisition is a significant development in the media industry. Further details regarding this transaction will be covered in subsequent reports.

— Alex

TechCrunch's Top 3 Developments

Today’s leading stories focus on significant moves in the tech and finance sectors. These include a major acquisition, continued growth in fintech, and a resurgence in the IPO market.

Amazon’s Acquisition of MGM

Amazon has finalized the acquisition of MGM in a deal exceeding $8 billion. This substantial purchase solidifies Amazon’s position among tech companies heavily invested in online video platforms.

Analysts suggest Amazon intends to leverage MGM’s content library to enhance its Prime subscription service. The goal is to reduce subscriber churn by offering a more comprehensive entertainment package.

However, the effectiveness of this strategy is debated. It’s questioned whether access to MGM’s films will significantly influence Prime members, given the service’s existing benefits, such as fast shipping.

The Expanding Global Fintech Landscape

Clara, a Mexican startup operating in the corporate spend management sector, has secured a new funding round. This follows closely on the heels of its previous capital raise.

This development occurs within a rapidly growing niche, evidenced by a recent $2.5 billion exit in the U.S., and further investment in companies like Ramp and Brex.

The trend suggests that successful fintech models originating in the U.S. are readily adaptable and scalable on a global level.

A Rebound in Initial Public Offerings

The strong pricing and initial trading performance of Flywire’s recent IPO signal a revival in the public offering market. This indicates that the previous slowdown in IPO activity is easing.

This positive momentum raises expectations for other companies, notably Robinhood, considering their own potential public debut.

The return of a robust IPO market provides a valuable avenue for companies to access capital and further fuel innovation.

Startups and Venture Capital Funding

TechCrunch recently highlighted five particularly noteworthy venture capital investments, demonstrating diversity in both industry focus and funding amounts.

Paysend Secures $125M for B2B Mobile Payments

Paysend, a UK-based company, has successfully raised $125 million to expand its mobile B2B payment solutions. It’s a common observation that many current fintech rounds involve both companies and payment technologies.

However, Paysend’s unique position lies in its provision of online payment services for small and medium-sized businesses from a base in the United Kingdom, even following Brexit. This suggests the UK fintech sector remains resilient.

Yalo Attracts $50M for Conversational Commerce

Yalo’s recent $50 million funding round exemplifies current market trends. The company secured funding less than a year prior to this latest investment.

Furthermore, investors actively sought out Yalo, rather than the company seeking investment, and the COVID-19 pandemic significantly boosted its business growth. Yalo represents a bet on evolving online shopping habits and is attracting substantial venture capital interest.

Skiff Gains $3.7M for Encrypted Document Editing

Skiff has raised $3.7 million to develop an encrypted alternative to Google Docs, as reported by Zack Whittaker. The platform aims to replicate the functionality of Google Docs while incorporating end-to-end encryption.

This project is particularly appealing to those prioritizing data privacy.

Treet Receives $2.8M to Facilitate Brand Resale Programs

The online resale market is experiencing significant growth, with companies like ThreadUp and Poshmark already publicly traded. Treet is capitalizing on this trend by enabling brands to establish and manage their own resale marketplaces.

Despite not being the most heavily funded startup, Treet possesses a substantial Total Addressable Market (TAM) given the vast number of brands that could benefit from its services.

Finally, OPay, an African fintech company, is currently finalizing a substantial new funding round. This investment has the potential to significantly increase the total venture capital investment in Africa for 2021, according to TechCrunch’s recent data analysis.

7 Key Inquiries to Make Before Relocating Your Startup to Florida

For several years, cities such as Miami, Austin, and Pittsburgh have been attracting both skilled professionals and capital from Silicon Valley. However, the onset of the COVID-19 pandemic significantly intensified this movement.

Recently, a considerable number of investors and startup founders have publicly announced their relocation to Miami, pointing to the area’s advantageous business environment and appealing lifestyle. While exploring alternatives is prudent, entrepreneurs should carefully consider several fundamental questions before arranging a move to the Sunshine State – or indeed, any up-and-coming technology center.

Considering a Relocation: Initial Questions

Before making a significant decision like relocating a startup, a thorough evaluation is essential. Careful planning can mitigate potential risks and maximize the benefits of a new location.

Here are seven crucial questions to address:

• What is the true cost of living? Beyond rent and housing prices, consider expenses like transportation, childcare, and healthcare.
• Is the talent pool sufficient? Assess the availability of skilled workers in your specific industry.
• How robust is the local ecosystem? Evaluate the presence of investors, mentors, and supporting businesses.
• What are the tax implications? Understand state and local taxes, including corporate income tax and sales tax.
• What is the regulatory environment like? Research the ease of doing business and any industry-specific regulations.
• How will the move impact your existing team? Consider the willingness of employees to relocate and the potential for disruption.
• What is the long-term vision for the area? Investigate planned infrastructure projects and economic development initiatives.

Digging Deeper into Florida’s Appeal

The recent influx into Florida, particularly Miami, is driven by several factors. The state offers a comparatively lower cost of living than Silicon Valley, coupled with a more favorable tax structure.

Furthermore, Miami’s growing tech scene and vibrant cultural landscape are attracting a diverse range of entrepreneurs and investors. However, it’s vital to remember that every location has its own unique challenges.

The Importance of Due Diligence

Relocating a startup is a complex undertaking. It requires careful planning, thorough research, and a realistic assessment of both the potential benefits and drawbacks.

Entrepreneurs should avoid making hasty decisions based solely on hype or anecdotal evidence. A data-driven approach, coupled with a clear understanding of your company’s needs, is essential for success.

(Extra Crunch is a membership service designed to empower founders and startup teams. Registration is available here.)

Big Tech Inc.

Further discussion regarding the Amazon-MGM acquisition will be omitted from this Big Tech update, allowing space for coverage of other significant developments.

• Facebook is currently exploring the possibility of enabling users across both its primary platform and Instagram to conceal the number of likes their posts receive. This feature is anticipated to positively impact user well-being, though it may prove challenging for individuals prone to competitive tendencies.
• Following the dissolution of its prospective merger with Plaid, Visa is actively establishing a curated directory of fintech startups. This list is intended to provide recommendations to Visa’s partners and clientele. Essentially, it offers startups an opportunity to gain validation from Visa and potentially expand their customer base. The benefit for Visa lies in facilitating increased digital payment transactions.
• GM and Lockheed are collaborating on the development of the next-generation lunar vehicle for American space exploration. It is characteristically American to task the creators of the Hummer and military hardware with constructing our next vehicle for extraterrestrial travel. A return to lunar exploration is arguably overdue.

Concluding the Big Tech segment, OpenAI has announced the launch of a $100 million investment fund dedicated to supporting startups. Microsoft is collaborating with OpenAI and contributing capital to this fund.

This development marks a shift from Microsoft’s previous stance, where the company indicated a lack of interest in venture capital investment due to perceived insufficient returns on assets. It appears this perspective has been reevaluated.

According to TechCrunch, Sam Altman of OpenAI and Y Combinator noted that the fund intends to “make substantial initial investments in a limited number of companies, likely no more than 10.” This initiative warrants close observation.

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