Equity Monday: People like Threads

Here’s the rundown from this morning: The global stock market is looking mixed, with the leading piece of financial news dealing with inflation data in the Chinese market. On the crypto side of things, there are no massive price movements in key tokens to examine. That said, the NFT market has been turbulent in the last few days due to incentive changes as a key marketplace. An FYI: We are back in earnings season, but there’s little to report on the tech side of things this week. Expect the pace to pick up next week. Ant has a new valuation thanks to a choice to offer share buybacks to existing backers. It’s still worth nearly $80 billion, just a lot less than it might have been valued at back in its 2020 IPO that got scuttled. People like Threads: The new social service from Meta has reached the 100 million sign-up mark rapidly. More on threads here on the TC Podcast. In Startup-Land: FrontRow is shutting down in another blow to Indian edtech, while Propel raised $2.7 million to connect African tech talent to global employers. And that is our show! We are back Wednesday, and Friday this week! For episode transcripts and more, head to Equity’s Simplecast website. Equity drops at 7 a.m. PT every Monday, Wednesday and Friday, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts. TechCrunch also has a great show on crypto, a show that interviews founders, one that details how our stories come together and more! 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

• 0:10Speaker 00

  Hello and welcome back to Equity, the TechCrunch Podcast, where we unpack the numbers and the nuance behind the headlines. This is July 10, 2023, and this is our Monday episode where we unpack the weekend and take a look at the week ahead. Hi, everybody. My name is Alex and I am back after a week off. It feels amazing to be back, let me tell you. Taking a week off, though, when you don't have childcare is not really a week off. Anyways, it was hard to stay away from the news cycle because there was so much going on. And I want to start with a quick little programming note. So last week I said that we'd run the TechCrunch Podcast in the Equity feed on Friday, but we wound up putting up an interview with the co-founder and CEO of Mercury instead. So make sure you check that out. Mary Ann absolutely crushed it and it's really high on my own list of things to get to this morning.

• 0:55Speaker 00

  All right, so what is on deck today on the podcast? Well, we're going to take a quick look at the global stock market and the latest from crypto. Then we're going to talk about Ant's new valuation, the latest growth metrics from Threads, and then two startup stories, one about ed tech, one about a talented marketplace. It's going to be a great show. Let's get into it.

• 1:14Speaker 00

  Let's start as we always do with a look at the global stock market. Spinning the globe and starting over in Asia, stocks are mixed today. The leading narrative is that Chinese inflation data missed expectations, adding to the narrative that China's economy is decelerating. Over in Europe, shares are up today, green across the board, in fact. So shout out European investors. And then finally, here in the US, shares are mixed in pre-market trading, but not by much. There doesn't really seem to be a prevailing sentiment yet in the American stock market to start this week, but by the time you hear this, that could have changed. Looking ahead, there are no new IPOs sadly. I was very bummed to come back to a really empty roster. And then earnings season, yes, it is time for Q2 earnings, but this week there's not really much from the tech side.

• 1:57Speaker 00

  If you care about financial institutions, well, Friday will be big, but otherwise, we're on break. And then there was crypto. Well, a week off did not really change the value of global cryptocurrencies much. Bitcoin is still worth around $30,000, changed about 1.5% in the last week. And ETH, Ethereum's token, is off about 5% in the last week to $1,860 a piece. Now, while I was out there, did seem to be a kind of mini panic in the NFT market, if you will. Changes to incentives at a key NFT marketplace are possibly the catalyst, though the crypto community is not really sure who's to blame. I'll just say this, though, if you care about blue chip NFTs and floor prices, you have not had a very good week.

• 2:41Speaker 00

  Next up, a segment that I'm calling "Key News from the Last Couple of Days", and first up, Ant's new valuation. Now, Ant, the Alibaba fintech spinout of sorts that wanted to go public back in late 2020, is offering to buy back a chunk of its shares from investors. Bloomberg reports that the company is willing to buy up to 7.6% of existing shareholder stakes at a valuation of $78.5 billion. Now, that's a lot of money, but don't forget it's also down about 70% from the valuation the company wanted to go public at a couple of years back. Recall that Ant's IPO and it getting yanked was kind of the opening salvo in China's multi-year crackdown on its domestic tech industry. And since then, the government has worked to shift the domestic focus, if you will, of its tech industry more towards chips and hard tech

• 3:25Speaker 00

  and away from things like social and fintech. This is, of course, part of the larger chip wars we talked about on equity ad nauseam. Now, is the Ant price cut really a shock? Here's the thing, uh, no. Have you seen what's happened to the broader fintech world? Still, though, it's a crushing reminder of Ant's former ambitions and really, who holds the power in China's economy?

• 3:47Speaker 00

  It turns out people like threads. Now, when Meta's new Twitter competitor Threads launched the other day, I wanted to play with it, and so I did. It turns out, however, that not having a regular, used Instagram account was a real setback for my entry into the new social platform. All I had at the time was a burner account that I set up to get past the Instagram login wall. I hate that thing, so that I could track bands on tour. Anyways, I was not alone in kicking.

• 4:11Speaker 00

  Threads tires. I'm sure by now you heard that Threads got 30 million downloads in its first day, but did you know that things have continued to be hot over at Meta's new service? TechCrunch reports that, and I quote, "Instagram's text-based app Threads has achieved the mark of 100 billion signups in just five days." "The Twitter arrival was launched on July 6th or July 5th in the Americas, according to a tracker." That is super impressive. It's a lot of folks, it's very fast, and it's catching up to how big Twitter is in like a week? So a couple of thoughts about how Meta actually managed this win. First of all, Threads worked right out of the box because Meta marshaled brands and celebrities to posts. That way, when people showed up, there was already stuff to kind of see and interact with.

• 4:52Speaker 00

  And then two, it built a feed for you. So if you had no followers, no one that you followed, AKA me on Instagram, you could still see posts. And the Instagram connection meant that folks quickly found one another, regardless of whether they had used Twitter or any similar service before. That's the smart stuff. On the other hand, oh my gosh, is it a boring social network? As my colleague Morgan Sun wrote on TechCrunch, "You can't post ass there, so we have beef with Threads." And by the way, if you want to hear more from Morgan on Threads and what's going well and what isn't, there's an interview with Taylor Hatmaker over on the TechCrunch podcast that I cannot recommend highly enough. Now, basically, here's what's going on. Musk is having a hard time running Twitter. Everyone wants a piece of its flanks, so everyone's lining up to take a bite.

• 5:36Speaker 00

  This is Threads. It's blowing up. We'll see how it does in the next couple of weeks, but it's already, what, a third of the size of Twitter in a week? That's impressive.

• 5:45Speaker 00

  Next up, a couple of startup stories, and we're going to start with a company called Front Row. It's a learning platform featuring celebrities, and it's not having a very good time. Reading TechCrunch, "Front Row, a hobby learning and community platform featuring celebrities in India, has shut down. TechCrunch has learned and confirmed." The three-year-old startup sought to build a community where well-known artists and athletes taught their craft to consumers. You should be familiar with this model in other markets, of course. And the startup had raised about $18 million, counting Elevation Capital, 8 Roads Ventures, Lightspeed Venture Partners, and not-boring capital among its backers. What went wrong? Well, the company scaled to $3 to $4 million in annual revenue,

• 6:26Speaker 00

  but really struggled to grow from there. And at that point, the CEO, Shahn Preet Singh, told TechCrunch that it was clear the company was just not venture scalable. So the company has cut jobs, is trying to pivot maybe a little bit, and may return some capital to its investors. Next up, a company called Propel that just raised money. Now Propel is a Lagos and Berlin-based startup that wants to build sustainable talent pipelines for communities and help global companies de-risk the process of hiring remote talent in emerging markets, particularly Africa. Just raised 2.5 million euro or 2.74 million dollars, if you want that in American, in a seed deal that TechCrunch covered. According to our own Tej Kenai Okafor, a strong factor behind Africa's

• 7:08Speaker 00

  growing tech ecosystem is its burgeoning talent. Being sought after locally and internationally, these homegrown folks have given rise to several talent matching platforms across the continent. These include Unicorn Andela, Go My Code, Alt School, Decagon, and others. So how many folks are we actually talking about? Well, according to Google's Africa Developer Report, the number of software developers on the continent grew almost 4% to 716,000 UI UX designers, engineers, and other tech professionals. So quite a few. It's pretty cool. We've seen platforms like Propel in the past, though with the global talent market growing and the global business community increasingly amenable to remote work, perhaps there'll be multiple winners in this particular startup category.

• 7:51Speaker 00

  All right, that is our show. We are out of time on this fine Monday morning, but don't worry, Equity is back on Wednesday. We are back on Friday. We have a big week planned for you. If you want to stay in touch with us in between, well, don't forget, we are on social media networks all over the world. On Twitter and Threads, we are EquityPod, or on Blue Sky, we skeet under the handle Equity. And if you need even more TechCrunch audio before Equity returns, well, you can check out Chain Reaction, Found, and the TechCrunch Podcast, our sister shows on the larger TechCrunch Podcast Network. I'm Alex, this is Equity. We'll talk to you soon. Bye.

• 8:25Speaker 00

  Equity is hosted by myself, Editor-in-Chief of TechCrunch Plus, Alex Wilhelm, and TechCrunch Senior Reporter, Mary Anne Azvedo. We are produced by Teresa Locan Solo, with editing by Kell. Bryce Durbin is our illustrator, and a big thank you to the Audience Development Team, and Henry Pickavet, who manages TechCrunch Audio Products. Thank you so much for listening, and we'll talk to you next time.