Equity Monday: Vice files for bankruptcy, Foxconn's investment in India, and two fascinating startup rounds

This week we talked about media, startup rounds and some Big Money Moves: Stocks are mostly up to start the week while crypto remains within the bounds of its recent trading range. Again. Vice has filed for bankruptcy, again highlighting how hard the media game can be. The company's eventual selling price looks like it will be a fraction's fraction of its once great worth. Foxconn is investing more in India, underscoring how critical it is for major electronics supply chain companies to diversify out of China — and the immense costs involved. Brex took a shot at buying part of SVB's portfolio, TechCrunch reports. Startup rounds: Smart raised $95 million at a slight discount to its 2021-era valuation and M-KOPA secured a pile of equity and debt fundraising. And we closed with the interesting sale of Forbes. Equity will be back on Wednesday and Friday! We'll see you then! 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 Alex and this is our Monday show where we take a look back at the weekend and a look ahead to the week to come. It is May 15th today, and that means we have reached the midpoint of Q2. So I do hope that you are halfway to all of your goals, KPIs, and OKRs. On the show this morning, we have stocks in crypto, Vice in bankruptcy, big money for Indian manufacturing, two big startup rounds, and more. Let's go.

• 0:43Speaker 00

  Let's start with a look at the stock market, and it does appear that shares are up nearly everywhere around the world. So if you own equities, happy Monday. Shares were mostly higher in Asia today, rising in Japan and South Korea and China. Major indices were nearly all higher in Europe as well. And here in the US, shares are set to rise at the open, though, of course, that could change by the time you hear this. As it is the midpoint of Q2, we don't have that many earnings calls to watch, but we will get numbers this week from Baidu, Alibaba, and Tencent, and Zoom will report next week. And next up, we have crypto. And I want to know, do you like your Bitcoin to cost around $27,000? Because the well-known cryptocurrency is once again back to that level. ETH is hovering around $1,800 this morning,

• 1:26Speaker 00

  both major tokens off 2% in the last week and up a point or two in the last 24 hours. Volatility in the crypto world does seem to have picked up a little in the last week, but not so much as to be super material. Sorry, traders. Crypto appears to be waiting for its next big thing. Recall that many crypto booms have come with a particular business model or product innovation, like ICOs or NFTs. Today, things seem more static from a product perspective, perhaps impacting the lack of interesting price movements that we are seeing today. Closing our little look at the land of blockchain USDC, perhaps the stable coin that is the easiest to trust, has dipped under the 30 billion market cap mark. Of course, stable coins trade on a one-to-one basis with a currency, the dollar, in the

• 2:07Speaker 00

  case of USDC. And at the same time, Tether is gaining on-chain units and is nearly back to its all-time market cap peak, if we can apply that phrase to a stable coin. It's a dynamic to keep an eye on.

• 2:21Speaker 00

  Next up, a little segment that I'm calling Big Financial News. And up top, we have Vice filing for bankruptcy. Yes, Vice, the multimedia news company, has filed for bankruptcy protection this morning. During its life as a private company, Vice raised around $1.6 billion, inclusive of debt, according to Crunchbase data. And to summarize how brutal the downfall of Vice has been, here's a 2017-era TechCrunch headline, and I quote, "Vice has raised $450 million ahead of potential IPO." That didn't happen. The company had a $5.7 billion post-money valuation at that juncture, a simply staggering amount of money. And then, according to Vice itself, the bankruptcy proceedings will likely head to a quick sale of the business. Now, to whom?

• 3:03Speaker 00

  Well, it appears that Fortress Investment Group and Soros Fund Management will buy what is left of Vice for around $225 million. So, why Fortress? Well, it turns out it has a credit claim against Vice for, and get this, $474.6 million, according to Vice's bankruptcy filing. The same filing notes that Vice has assets between a half-billion and 1 billion, and debts in the same range. Just to summarize all this, damn, media is really hard. Turning to the page, let's talk about Foxconn investing in India. TechCrunch reports, and I quote, "That Foxconn will invest $500 million to set up manufacturing plants in the southern Indian state of Telangana, the latest in a series of bets from the key

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  Apple contract provider, as it expands its base in the South Asian market." Now, for context, recall that doing business in China, a key manufacturing market for both Foxconn and American electronics company Apple, is increasingly difficult. So, many companies are looking to hedge their bets and set up manufacturing facilities in other countries. India is proving to be a popular option, among others. Apple and Foxconn have been synonymous with China for ages, so $500 million is not the mark of an end to a long-running relationship, but it does underscore the scale of investment at play to de-risk supply lines that cannot depend on a single market any longer. And finally, in our segments about small financial news that really does matter, TechCrunch reports that Brex took a shot at buying a portion of the parts of Silicon Valley

• 4:31Speaker 00

  Bank's portfolio. This is very interesting. We chatted with Brex co-CEO and co-founder Enrique Dubugas about the choice, and he told our own Mary Ann Azaveto that his company submitted a bid when the FDIC said that it was open to selling SVB's remains in pieces and to non-banks. Now, Brex didn't actually win with its bid, but the fact that it even tried tells us a bit about the health of the company and the scale of ambition at the corporate spend unicorn.

• 5:00Speaker 00

  And finally, let's talk about startups, and the first one is from the UK. Smart, a London-based startup that helps employers and their employees manage and monitor their pensions, said that it has closed $95 million in Series E funding. TechCrunch writes that the company plans to use the capital to expand its international footprint and make acquisitions. Now, as an American, I want to know, what is a pension and can I get one? I've heard of these things, but I've never really seen one out in the wild. Who put the capital in? Well, it was Aquiline Capital Partners, a new backer at the company. What was the valuation? Well, reporting indicates that the round came in with a price that was down just a little bit from the company's last round. What was that last round valuation?

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  Well, PitchBook pegs it at $564 million post-money, and that was back when Smart raised its 2021 era Series D, so call it, I don't know, 550? Our next company is from Kenya. M Kopa, M-K-O-P-A, an asset financing platform that offers underbanked African customers access to, quote, "productive assets" and the ability to pay for them via digital micro-payments, has secured over $250 million in new funding, according to TechCrunch. Now, we report that the figure includes $55 million in equity and over $200 million in debt access. Now, I'm behind on the company, frankly, so here's how TechCrunch described it in our recent coverage, and I quote, "M Kopa's business revolves around using debt to finance

• 6:24Speaker 00

  customers' purchases of products and services it sells, such as smartphones and solar power systems, as well as loans and health insurance across four markets: Kenya, Uganda, Ghana, and Nigeria." It's a new model to me, I really like it, and $200 million in credit access is going to go a long way. Very cool. And our last little segment for the day is about Forbes. Forbes, yes, the business magazine and online media conglomerate has announced plans to sell itself for $800 million. Now, Forbes is currently mostly owned by a Hong Kong-based firm called Integrated Whale Media, which is a great name. But Axios reports, and I quote, "that Austin Russell, the 28-year-old American CEO of electric vehicle tech company Luminar Technologies, will acquire an 82% stake in the media brand at an $800 million valuation."

• 7:09Speaker 00

  The question is, where is a big chunk of that money coming from? And is the buyer obfuscating capital that could invite, and I'm in polite here, regulatory scrutiny? Well, it turns out, no matter what, media is not always worth pennies on the dollar.

• 7:24Speaker 00

  And that is our show for this fine and beautiful Monday morning. But don't forget, you can follow Equity on Twitter, where we tweet under the handle Equity Bond, or you can follow myself on Twitter, I tweet under the handle Alex. A reminder, though, that there's other podcasts here at TechCrunch, including Found and Chain Reaction and the TechCrunch Podcast, lots of great stuff, so go check those out if you have time. And in the meantime, Equity is back on Wednesday and Friday. We'll see you then. Bye.

• 7:48Speaker 00

  Equity Mondays are hosted by myself, editor-in-chief of TechCrunch Plus, Alex Wilhelm. We're produced by Teresa Locan Solo, with editing by Kel Keller. Bryce Durbin is our illustrator. Alyssa Stringer leads audience development, and Henry Pickavet manages TechCrunch Audio Products. Thanks so much for listening, and we'll be back next week.