Toil and trouble and … startup acquisitions!

2 years ago 110

Welcome to Startups Weekly, a fresh human-first take on this week’s startup news and trends. To get this in your inbox, subscribe here.

I think it took maybe three days after I roasted our rather dry M&A season for the news cycle to prove me wrong. This week we saw Naver acquire Poshmark, Duolingo buy its first company, Spotify acquire content moderation tech company Kinzen, and, um, Twitter got closer and closer to striking a deal with Musk.

When we see high-profile acquisitions happen in close proximity, the human response is to think that there’s a trend forming. Eh. I’d rather ask questions: Poshmark’s acquisition is at somewhat of a discount, so what does that tell us about the state of marketplace startups and their valuations? Duolingo is finally becoming an acquisition-friendly company; what does that tell us about their priorities and expansion efforts? How does Spotify’s acquisition play a role, if any, in its recent layoffs and shuttering of some original podcasts? Musk is readying to buy Twitter, after saying he wants to buy Twitter, but that’s somehow news because, wait, does anyone know what’s going on?

Bloomberg tells me that I’m not entirely wrong for thinking things have slowed down. M&A in the United States has fallen for the past five quarters. The same report says that “roughly $212 billion worth of deals were announced in the past three months, the lightest period since the second quarter of 2020.” At the same time, tech is a bright spot. Despite the fact that deals are slowing, the tech sector’s total deal value is up 39% year over year, Bloomberg data claims. It’s the big ones weighing out, such as Adobe’s $20 billion acquisition of Figma.

I’m always here to provide nuance, especially after an especially eventful week. Do let me know what you’re thinking about by tweeting at me or responding to this post. If you missed last week’s newsletter, read it here: “Welcome to spooky season in startups.”

In today’s newsletter, I’ll talk to you about Liquid Death and crypto advertising.

If you like this newsletter, do me a quick favor? Forward it to a friend, share it on Twitter and tag me so I can thank you for reading myself!

Your favorite tech podcast

On Equity this week, your favorite podcast trio spoke to the numbers and nuance behind the top tech headlines. I mean, we’re biased, but who doesn’t love a weekly deep dive into top news? Remember that we have three podcasts a week: Equity Monday is best paired with a cup of coffee and a catch up on the week ahead; Equity Wednesday is a deep dive into a question or a thought; and Equity Friday is a look back at what the heck happened this week.

Here’s why it’s important: This week, the highlight of the podcast for me was our discussion about Liquid Death’s $700 million valuation. It’s especially interesting when you consider recent news that Haus, a low-ABV alternative to traditional alcohol, is putting itself up for sale due to a funding round falling apart. Listen to our whole conversation here, come for the Liquid Death, stay for if Alex is going to get his future baby a Substack.

Image Credits: Liquid Death

Dear carry, carry me?

Flag this for a future trend for me to look into: We’re seeing more and more VC firms dedicate a portion of carried interest to people who refer successful deals to them. This week, Mary Ann looked into how a cross-border VC firm is sharing profits in its 20-founder LP base.

Here’s why it’s important: This trend first emerged on my radar around a year ago, when Gumroad founder and CEO Sahil Lavingia announced a new type of scout program. Longtime Startups Weekly readers will remember this evergreen take from back then: It’s hard to philosophically argue against more transparency and distribution in entrepreneurship, but it’s also hard to pull off those goals in a way that actually helps those who need it most.

Image Credits: Say-Cheese / Getty Images

The follow-up

I’m experimenting with a new section in Startups Weekly, where each week we follow up with an old story or trend to see what’s changed since our first look. This week, we’re following up on Kim Kardashian. A few weeks ago, we spoke about Kardashian and the financialization of trendsetters after she announced the debut of her private equity firm.

Here’s what’s new: She’s back in the news, but without congrats Twitter. Kardashian was fined $1.26 million by the SEC for advertising crypto without a disclosure. Her mistake? She should’ve mentioned that she was paid $250,000 to publish a post about EthereumMAX’s EMAX tokens on her Insta story.

Anita and Dom say it best, so I’ll just place this link here for people who want to keep reading: “Let’s not defend Kim Kardashian for shilling crypto.”

Image Credits: Spotify

A few notes

We’re less than one month away from TechCrunch Disrupt, and I’m already emotional. It’s going to be a blast, a pep talk, a realization and a week not to miss. Here’s the full agenda, and here’s where you can get your tickets.

First up, use code “STARTUPS” for a special reader discount for Disrupt tickets. We’re less than one month away!
We also have a special for those impacted by layoffs. If you were laid off, go here to get a free ticket to TechCrunch Disrupt’s Expo.

Enjoy these exclusive benefits in the TC+ Lounge at Disrupt

While I have you, let’s talk some more. As you know, I co-host Equity, which goes out thrice a week and is TC’s longest-running podcast. We have some besties to listen to, too, including our crypto-focused show that goes by Chain Reaction and the founder-focused show that goes by Found. The TechCrunch Podcast is also a can’t miss, so pay attention to all the good shows that they’re putting out.

Seen on TechCrunch

Google makes good on its $1B plan to support Africa’s digital economy, but there is a long way to go

Amazon scales back Scout delivery robot program

If it’s agtech, it’s climate change: How the crisis is shaping investors’ strategies

AI music generators could be a boon for artists — but also problematic

Seen on TechCrunch+

Yeah, no, most VCs still don’t really care about your path to profitability

5 key IP considerations for AI startups

Even as ESG faces growing backlash, these companies are all-in

Pitch Deck Teardown: Vori’s $10M Series A deck

Platforms beware: Politics won’t save you from antitrust legislation

Same time, same web page, next week?