Byju's valuation shakeup and what's ahead for WWDC

Apple’s WWDC is just hours away, and we’re gearing up for big announcements on – you guessed it – AI. We're kicking off today’s episode of Equity with a list of what we can (and can't) expect from the highly anticipated developer conference. But that's not all we talked about this morning. Becca Szkutak also took a look at Byju’s alarming valuation drop. The Indian edtech giant, once valued at $22 billion, might now be worth nothing according to BlackRock. The news may not come as a surprise given the rocky year Byju’s has had, but as Manish Sing put it, its journey stands to be one of the most “spectacular startup slides in recent memory.” To close out, we had news of a new fund looking to give the Italian startup ecosystem a boost. We’re optimist about the Italian Founders Fund and what it could contribute to the market, so press play and join the conversation! Equity is TechCrunch’s flagship podcast, produced by Theresa Loconsolo, and posts every Monday, Wednesday and Friday. Subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts. You also can follow Equity on X and Threads, at @EquityPod. For the full episode transcript, for those who prefer reading over listening, check out our full archive of episodes over at Simplecast. Credits: Equity is produced by Theresa Loconsolo with editing by Kell. Bryce Durbin is our Illustrator. We'd also like to thank the audience development team and Henry Pickavet, who manages TechCrunch audio products. Learn more about your ad choices. Visit megaphone.fm/adchoices

• 0:11Speaker 00

  Hello and welcome back to Equity TechCrunch's flagship podcast about the business of startups. This is our Monday show where we take a look at the weekend and get you ready for the week ahead. Today is June 10th, 2024, and I'm Becca Scootac, a senior reporter at TechCrunch. On today's show, we have what to expect from Apple's Worldwide Developer Conference today, a new valuation for Indian ed tech Baiji's, a new fun betting on Italian startups, and a quick note for Pitch Deck teardown fans. Hy is on vacation this week, so we'll have a shorter show today and get back to our regular scheduled programming when he returns. Let's get started.

• 0:46Speaker 00

  The first big story we're looking at today is Apple's Annual Worldwide Developer Conference, which kicks off later today at 10 a.m. Pacific, 1 p.m. Eastern. Well, last year's WWDC event introduced us to the Vision Pro headset. This year, we don't expect any new hardware announcements as the event will largely be focused on the company's generative AI plans. According to TechCrunch's Brian Heater, we should expect a big Siri refresh, Apple Mail to get an injection of Apple's LLM known as Ajax to offer email reply suggestions, and even a new look and new features for Apple Photos. CEO Tim Cook promised last month that the company would, quote, "break new ground" on generative AI, adding, also in quotes, "we believe it will unlock transformative opportunities for our users." Brian Heater expects a lot of focus on iOS.

• 1:29Speaker 00

  There were early reports that suggested Apple was meeting with Google about a potential Gemini integration for iOS, while conflicting reports say that they've been meeting with OpenAI. It would be interesting if Google were to land the deal. If it did, its LLM Gemini would play a key role in two operating systems that account for combined 96% of the global mobile operating system market. Apple has gotten a lot of strife from the industry that it may be behind its peers when it comes to generative AI. So we'll see what gets announced today and how people are feeling after the show. If you want more, Brian Heater and the rest of the team has lots of pre-show coverage you can comb through, and there will be more to come as the day goes on.

• 2:09Speaker 00

  And the second story we're looking at today involves Baiju's, the Indian ed tech giant that used to be worth a whopping $22 billion. TechCrunch's Manish Singh reports that BlackRock estimates that their stake in the company is now worth nothing, according to a disclosure in a recent SEC filing. That news probably won't come as a huge surprise to regular listeners of the show, because if you remember, last October, BlackRock cut the valuation of Baiju's to just about $1 billion. Separately, HSBC also estimates that the value of Process's 10% stake in the Indian startup to have diminished so severely its analysts have not bothered to attribute any value to it at all. Whew, it has been a rough year for Baiju's, which struggled to meet its financial reporting deadlines

• 2:52Speaker 00

  last year and fell short of its revenue projections by more than 50%. Investors don't tend to like those kind of metrics. In the same year, the company faced governance issues, its auditor and three board members quit, and its $1 billion fundraise was derailed. Baiju's did manage to raise at least $200 million at a post-money valuation of $250 million this year, but that investment is being legally disputed by some of its largest investors. Baiju's used to be one of the highest value startups in India, gaining ground amid a rise in interest in ed tech thanks to the pandemic, but it doesn't look like they are still able to ride those macro headwinds. This markdown makes Baiju's one of the most, in quotes, "spectacular startup slides in recent memory."

• 3:35Speaker 00

  And to close out today's show, we have a look at a new fund in Italy courtesy of this morning's TC newsletter. Our own Anaheim reports that a newly launched fund called Italian Founders Fund has raised €50 million to invest in 25 companies in the Italian startup ecosystem. The firm will be sector agnostic and hopes to work with both global VCs and local accelerators to back more Italian founders with, quote, "global ambitions." Italian Founders Fund has backed four companies thus far with a fifth deal in the works. They've already backed a customer research startup and an HR tech startup as well. The fund is a, quote, "step up from the angel investing the Italian Founders Fund team was previously engaged in." And founding partner Lorenzo Franzese said that Italian Founders Fund is addressing the

• 4:19Speaker 00

  challenge for early-stage founders in Italy to find a high conviction lead investor at the pre-seed and seed stages. Now, while that quote implies there are not other funds in Italy, which there definitely are, including Exor Ventures, Primo Ventures, and United Ventures, among others, I will say, as someone who sits over here in the US, you definitely do not hear about the Italian startup market as much as you do at their ecosystems in Europe. So if this fund is the first, it's the third, it's the fifth, if it's going to help give a boost to that market, I don't think it really matters, and I think that is going to be a net positive overall.

• 4:56Speaker 00

  And that's it for today, but Equity will be back on Wednesday. Mary Ann Ezevedo has an interesting conversation coming up with NEA Venture Partner Vanessa Larko, so definitely stay tuned. If you want more from us between now and then, follow us on X and Threads at EquityPod. Thank you for listening, and you can always find more stories from TechCrunch on techcrunch.com.

• 5:19Speaker 01

  Equity is produced by Teresa Loconsolo with editing by Kel. Bryce Durbin is our illustrator, and we'd like to give a big thanks to our audience development team and Henry Pickavet, who manages TechCrunch Audio Products. Thanks so much for listening, and we'll talk to you next time.