Zoom to Acquire Five9 for $14.7 Billion in All-Stock Deal - Daily Crunch

Daily Crunch: July 19, 2021

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Venture Capital's Evolving Landscape

Greetings, and welcome to today’s Daily Crunch for July 19, 2021. Historically, the venture capital world operated with discernible seasonal patterns.

Investment activity would traditionally slow during December, and the months of July and August often saw a reduction in deal flow. However, these fluctuations have become less pronounced.

Currently, securing funding appears to be a year-round endeavor. The volume of deals being completed demonstrates that venture capital activity is now consistent across all seasons.

Recent Deal Activity

The consistent pace of investment is readily apparent in the stories detailed below. This illustrates the ongoing dynamism within the startup ecosystem.

Further details regarding recent funding rounds and key developments can be found in the following reports. — Alex

TechCrunch's Leading Three Stories

Here's a rundown of the top three tech news items as reported by TechCrunch.

Rappi Secures $500 Million in Funding

The demand for on-demand services remains strong globally, as evidenced by Rappi’s recent funding round of $500 million. This investment elevates the Colombian delivery company’s valuation to $5.25 billion.

According to Crunchbase, Rappi has accumulated over $2 billion in funding since its founding. The company currently provides services in nine countries and across 250 cities throughout Latin America.

Zoom's Acquisition of Five9

An agreement has been reached for Zoom to acquire Five9, although the completion of the deal is anticipated in the coming year.

The transaction is valued at $14.7 billion, sparking considerable discussion within the industry. This represents a substantial financial commitment and involves the merging of two publicly traded companies.

Both Zoom and Five9 initially benefited from venture capital funding, and this acquisition may establish benchmarks for pricing in future software mergers and acquisitions. Further details regarding the deal's specifics can be found on TechCrunch.

Robinhood and Duolingo IPO Pricing

For those following the public offerings of major tech companies, recent developments from both Robinhood and Duolingo are noteworthy.

Fresh data concerning the initial public offering (IPO) prices has been released for Robinhood, a prominent U.S. consumer fintech company, and Duolingo, a leading U.S. edtech platform.

• Robinhood is a U.S. consumer fintech giant.
• Duolingo is a U.S. edtech giant.

Startups/VC

Sweetch secures $20M in funding to promote increased physical activity: Smartwatches frequently deliver notifications at inopportune moments, such as prompting movement while dining. Sweetch aims to deliver more intelligent encouragement for individuals to prioritize their well-being, positioning this as a strategy to “proactively manage chronic illnesses.” Considering the universal need for improved health habits, the performance of this startup is of considerable interest.

Recruiting Innovation

Dover obtains $20M to streamline the recruitment process: Traditional recruiting methods often rely on manual processes and spreadsheet management, or systems like Lever. However, several startups believe there’s potential for further optimization. Dover is one such company, developing software designed to assist recruiters in “efficiently managing and consolidating multiple candidate pools for automated sourcing, and subsequently overseeing the outreach process.” This venture has now received funding from Tiger Global.

Breakr facilitates connections between musicians and influencers: The era of relying on radio airplay to achieve mainstream success is over. Breakr seeks to assist musical artists in navigating the evolving landscape by connecting them with individuals who possess established audiences. Breakr will collect a 10% commission on fees generated through these connections.

Sales and Real Estate Tech

Recapped raises $6.3M to enhance sales software: Similar to Dover’s focus on improving recruiting, Recapped is dedicated to refining the sales process. They are developing software that offers increased transparency into sales pipelines and provides buyers with a comparable digital experience to that offered to sales representatives. Any improvement to the purchasing experience is welcome!

Jones aims to simplify commercial real estate vendor hiring: Engaging contractors for building maintenance or improvements carries inherent liability for property owners. Jones has recently raised $12.5 million to assist commercial real estate professionals in “locating and hiring qualified personnel in a legally compliant manner.”

Media and Acquisition News

TechCrunch reported that the private equity firm Carlyle is exploring a potential investment exceeding $400 million in LiveU, a company specializing in livestreaming services.

Seed-Stage Financing: A Founder's Guide to Understanding

A well-known verse suggests avoiding comparisons to others, as there will always be those with more or less than ourselves.

This principle applies equally to startup fundraising; the amount of your initial seed funding will be dictated by your company’s specific requirements and the investors involved.

Yin Wu, a three-time graduate of Y Combinator, emphasizes that fundraising should not be considered the ultimate objective. The true goal is constructing a thriving business.

This guide is designed for early-stage founders seeking a clearer understanding of equity distribution, or those experiencing anxiety about the amount of capital to secure. It also serves as a valuable resource for early team members and co-founders unfamiliar with startup financing.

Key Areas Covered

• The mechanics of financing: SAFEs versus traditional equity rounds.
• Determining the appropriate amount to raise.
• Establishing your company’s valuation.

Understanding these elements is crucial for navigating the initial stages of funding.

(Extra Crunch is a membership program dedicated to helping founders and startup teams achieve success. Registration is available here.)

Big Tech Inc.

Significant developments are unfolding within the technology sector. These include leadership changes at a key lidar firm and expansions in the streaming and delivery service landscapes.

Velodyne Leadership Change

A change in leadership has occurred at Velodyne, a company specializing in lidar technology that became publicly traded through a SPAC (Special Purpose Acquisition Company).

This news is part of a larger trend of instability following SPAC transactions, indicating that achieving public status doesn't guarantee sustained organizational stability. Currently, Velodyne’s stock is valued at $8.69 per share, a considerable decrease from its peak of $32.50.

CNN's New Streaming Service

CNN is preparing to launch a new streaming platform, joining the growing number of services denoted with a “+” symbol. The company is actively recruiting personnel for this venture.

This expansion represents CNN’s entry into the competitive streaming market, aiming to capitalize on the increasing demand for on-demand content.

Uber Expands Grocery Delivery

Uber is broadening its grocery delivery service to an additional 400 cities. This expansion signifies the ride-hailing company’s commitment to diversifying its services beyond transportation.

The timing of this announcement, preceding Uber’s earnings report, suggests a strategic move to highlight positive developments, potentially offsetting any concerns regarding past financial performance.

Cybersecurity Concerns and China

The United States government has formally accused China of being responsible for the extensive hacking of Microsoft Exchange servers earlier in the year. This incident prompted intervention from the FBI due to fears of widespread damage.

There is a noticeable shift in the approach to cybersecurity, with increased willingness among nations to publicly attribute malicious cyber activity to countries like China and Russia.

Growth Marketing Insights from TechCrunch Experts

A discussion featuring Danny Crichton and MKT1, both previously featured in TechCrunch Experts interviews, will be held tomorrow, July 20th.

The event is scheduled to begin at 5:00 PM Eastern Time and will take place on the Twitter Spaces platform.

Focus of the Discussion

Crichton and MKT1 will be sharing their observations regarding current growth marketing trends.

Event Details

• Date: July 20
• Time: 5:00 PM ET
• Platform: Twitter Spaces
• Participants: Danny Crichton and MKT1

Attendees can expect to gain valuable insights into the evolving landscape of growth marketing strategies.

This session offers a unique opportunity to learn from experienced professionals in the field.

The September Disrupt Stage Schedule Revealed

We are pleased to provide further details regarding the Disrupt Stage. This platform will host leading figures in the technology sector, offering insights into their organizations, future strategies, and the evolving technological landscape.

The Disrupt Stage is designed to showcase innovation and thought leadership within the tech community.

Featured Discussions and Speakers

Attendees can anticipate a series of compelling discussions led by prominent industry experts. These sessions will cover a wide range of topics, from emerging technologies to the challenges and opportunities facing tech companies today.

Keynote addresses and panel discussions will provide valuable perspectives on the future of technology.

What to Expect from the Disrupt Stage

• Company Deep Dives: Exclusive looks into the inner workings of successful tech businesses.
• Future Outlooks: Discussions on upcoming trends and their potential impact.
• Industry Insights: Expert analysis of the current tech ecosystem.

The Disrupt Stage aims to foster a dynamic exchange of ideas and inspire the next generation of tech innovators.

We believe these sessions will be incredibly valuable for anyone interested in staying ahead of the curve in the rapidly changing world of technology.

Stay Tuned for More Updates

Further details about the specific speakers and session times will be announced shortly. Keep checking back for the latest information on the Disrupt Stage agenda.

We look forward to welcoming you to what promises to be an insightful and engaging event.