Equity Monday: Zoom buys Five9 as Robinhood sets IPO price range

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines. This is Equity Monday, our weekly kickoff that tracks the latest private market news, talks about the coming week, digs into some recent funding rounds and mulls over a larger theme or narrative from the private markets. You can follow the show on Twitter here and myself here. It was a big damn morning, so we had to cut some stuff. Here's what we got into: Stocks and cryptos are off this morning, as inflation and COVID-19 concerns rise. Zoom is buying Five9. The deal is not super expensive, nor is it cheap. But given the huge percentage of Zoom's market cap that it represents, it's a serious wager from the video conferencing startup. Carlyle is buying LiveU for around $400 million. TechCrunch broke this news. The deal shows that private equity interest in startups that aren't unicorns. Robinhood dropped a new SEC filing this morning! That means we have a price range and valuation target to play with. More from TechCrunch on the matter shortly. From India: A huge round for Lenskart, and a big Series A for GlobalBees. And we covered this round from Nigeria. A smaller transaction, but one that could prove to be quite neat, we reckon. Ok! Chat Wednesday! 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

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  Good morning and welcome to Equity Monday for July 19th, our weekly primer where we catch up on the news and as always explore the numbers behind the headlines. This is Alex and I'm just going to say that I'm extremely hyped for this week of news. Now, why? Well, because there's been enough news just this Monday morning to fill a whole week's worth of blogging. Just imagine how bonkers things are going to be by Friday. But before we get into what happened over the weekend, a quick look at the markets. Asian stocks were down today, European stocks were down even more, and American stocks are set to open sharply lower this morning. So what's going on? Well, according to the financial press this morning that I read, it appears to be a general concern that a resurgent COVID-19 could once again limit

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  economic activity. Couple that with well-covered inflation concerns and things are not exactly peachy in the global market. Now, turning to Bitcoin and Friends, aggregate crypto market cap was off around 4% in the last 24 hours, which means that not too much is going on in the world of Bitcoin. And with that, let's talk about the weekend.

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  This weekend Zoom, the former startup darling, announced that it will buy Five9, another public company. What does Five9 do? Well, in two words, cloud contacts. And what does Zoom do? Well, it connects people to one another via voice and video. So it's not really that hard to see how the two companies could work together. Now, the deal is worth $14.7 billion, a medium healthy premium over the company's $11.9 billion market cap, according to Yahoo Finance. And really, this whole Five9 deal is a little bit more attractive today than it was yesterday in light of this morning's market sell-off. Now, Zoom is worth north of $100 billion, but not too much more. So Zoom is betting around 14% of its value in the deal, which

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  means that it really expects a serious boost from the transaction. Now, looking at the data, in its most recent quarter, Five9 put up $138 million in quarterly revenue, up 45% from its year-ago period. Zoom is therefore paying around 27 times the company's current run rate. At that growth rate, the price feels pretty reasonable in light of today's market pricing dynamics. Now with that, let's talk about this morning.

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  Like I said, there is a lot going on today, so we'll have to be somewhat summary. We're going to blend our funding round coverage and morning update into a single section as a lot of the big news this morning is actually about gargantuan funding events. Kicking off, TechCrunch reported this morning that private equity firm Carlyle is buying live streaming platform LiveU for more than $400 million. Now, per TechCrunch.

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  LiveU's satellite cellular hardware and software for capturing and delivering live streaming and broadcasting video is used by over 3,000 large media organizations.

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  As far as private equity deals go, this one is just not huge. But as LiveU raised the bulk of its venture capital by 2012, it's an interesting deal. Crunchbase data indicates that LiveU raised a $6 million round in 2019. That's pretty small, but its $27 million Series D from November of 2012 was its last real serious round, so maybe the deal is a good outcome. Also out this morning is a new SEC filing from Robinhood discussing its potential IPO price range. The new numbers imply that Robinhood could raise $2 billion at a valuation of as much as $35 billion, according to Bloomberg. Now, obviously, we're going to be tearing into this filing as soon as we get the podcast out, but we haven't yet, so we have it. That the Robinhood IPO is moving forward is pretty indicative of the times.

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  Robinhood is trying to hit a timing window with this deal. It wants to get out now, despite its somewhat controversial year, because public market tech valuations are just so welcoming. Now, we're expecting a host of IPOs this quarter, but Robinhood's own debut is probably going to be the biggest of them all, thanks to how well-known the brand is and frankly, its valuation. The $35 billion price tag should help Robinhood clear out its convertible debt it had to raise early in the year cleanly. Of course, more to come on that shortly. Moving along, the Indian startup scene had a huge start to the week. Two items today for your enjoyment. The first one, Lens Cart, is now worth $2.5 billion after raising $220 million from Tamasik and Falcon Edge Capital. TechCrunch reports that the company's CEO, Peiyush Bansal, said that, quote.

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  The profitable startup, which sells eyeglasses and contact lenses online and through about 750 physical retail outlets across the country, has seen a surge in sales of eyewear products in the pandemic year.

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  Lenscard sold around 8 million pairs of glasses last year and as TechCrunch notes, is a softbank backed company. Not a bad day for Masa. Next up, Global B's, all one word, which raised a $150 million Series A. Now, our own Manish Singh reports that the round itself was half debt and half equity, but even with that caveat, it is the largest Series A in India's history. So, what does Global B's do? Well, it buys and invests in e-commerce brands. This is what you might call the e-commerce roll-up strategy and it has attracted so much capital over the world in the last couple of months, in Europe, in the US, and not surprising to see a big deal in India. And then from Nigeria, a smaller transaction, but one to take note of. Chaka has raised a $1.5 million pre-seed round. The startup wants to bring a Robin Hood-like experience to Nigeria,

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  while also allowing folks outside the country to invest in Nigerian assets. Now, per our reporting, the company has secured the pertinent licenses and needs for its work, and now with fresh capital, could be set to grow rather quickly. It is a startup to keep an eye on.

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  Closing today, a small note that we have a very fun Wednesday show coming this week. We are hosting the author of a recent business book concerning a company that you've heard of. It's a talk that we're extremely excited to host, so please tune in. And with that, we are out of time. You can of course, follow the show on Twitter at EquityPod or myself, where I tweet under the handle at Alex. We will chat with you Wednesday morning. Until then, talk soon. Goodbye.