German insurance giant Allianz increases its VC fund to $1.1 billion

Allianz X, the venture capital arm attached to German insurance giant Allianz, has increased the size of its fund to €1 billion, around $1.1 billion, according to an announcement made today. The fund was initially €430 million, or around $490 million, when it launched in 2016.

This new injection comes directly from parent Allianz SE, the 124-year-old insurer which did €130 billion ($150 billion) in revenue last year, and it makes Allianz X one of the largest active startup investment vehicles in Europe. While it is anchored in Europe, the fund’s investment thesis and focus is very much a global one with a focus on verticals including fintech, health, mobility, data and cybersecurity.

It has made 15 deals to date with a focus on growth-stage investments in startups such as emerging market-focused microinsurance company BIMA, Southeast Asian ride-hailing unicorn Go-Jek, U.S-based capital marketplace C2FO and European challenger bank N26.

Allianz X, which initially began as an in-house incubation venture, is now looking to go after more of the same with its enlargened kitty but it also plans to get to work with its existing portfolio of companies.

“Since shifting our strategy, we have built a great portfolio in which many companies have already developed successful partnerships with Allianz’s business units. We are very excited about raising our investment budget to €1 billion and will use the funds entrusted to us to both strengthen our portfolio and build strong, global platforms that create new businesses for Allianz,” Dr. Nazim Cetin, CEO of Allianz X, said in a statement.

Beyond potentially supplying more capital to its existing investors — it isn’t clear whether Allianz X is a part of the new financing round that Go-Jek is raising, for example — the fund is keen to identify areas where its business units can add value both for the portfolio startups and the Allianz business itself. And, with a network of offices that spans more than 70 countries, there’s plenty of scope for collaboration.

In Indonesia, for example, Allianz has worked with Go-Jek to offer insurance to the ride-hailing company’s drivers that is payable at an affordable daily rate. That, both of them claim, has helped give many families health insurance for the first time whilst of course growing the Allianz Indonesia business by tapping into Go-Jek’s driver base which, the company says, covers “millions” of Indonesians. That’s one part of Go-Jek’s fintech strategy, which includes relationships with some 28 financial institutions to provide access to financial services and other products.

Indeed, Allianz X said it has developed dedicated operational capabilities to replicate that type of collaboration across its portfolio.

“Our work with portfolio companies is focused on developing mutually beneficial strategic partnerships between the portfolio company and one or more Allianz operating entities and global business lines. Each investment has a dedicated team at Allianz X that assists the company with joint corporate development initiatives and implements them alongside the Allianz business unit,” a spokesperson told TechCrunch.

Macquarie Capital Venture Studio adds three new companies to infrastructure tech portfolio

Macquarie Capital Venture Studio, the infrastructure-focused accelerator affiliated with the nearly $500 billion-dollar investment firm, Macquarie Group, has added three companies to its portfolio.

The companies, AirMap, Envoy Technologies, and Teralytic, provide services in airspace management for drones; electric vehicle sharing services; and soil analysis, respectively.

Through the venture studio, Macquarie tries to bring the companies into new markets through its connections with infrastructure and development projects around the world.

The Sydney, Australia-based investment firm has already invested in six companies for its accelerator program, launched in conjunction with R/GA.

Other companies in the Macquarie portfolio include the developer of redesigned solar axis trackers, Sunfolding; a company that produces water from condensation, Zero Mass Water; and a drone inspection company, Hangar Inc.

Envoy marks the second investment in electric vehicle charging infrastructure and services for Macquarie, since the company also invested in FreeWire Technologies. The venture program is also interested in the internet of things — backing the control system cybersecurity company, Mission Secure; and T-REX Group which provides data services and software for markets. 

“These companies have developed solutions that significantly optimize infrastructure and real assets and have the potential to transform their respective end markets,” said Stephan Feilhauer, Senior Vice President at Macquarie Capital, in a statement. “With their participation in MCVS, they will not only receive growth capital, but also access to Macquarie Capital’s global network of expertise, assets and clients at the intersection of infrastructure and technology.”

The Macquarie program includes a small equity investment and consultation with R/GA on a product development and marketing plan.

“R/GA is excited to collaborate with an industry leader like Macquarie Capital to launch this innovative Studio, leveraging our creative capital and network to create value for the participating companies,” said Stephen Plumlee, Global Chief Operating Officer of R/GA and Managing Partner of R/GA Ventures, at the time of the partnership announcement. “Rolling admissions and the module structure will enable R/GA to offer the participating companies an increased level of engagement and support.”

Flipkart co-founder Sachin Bansal invests $92M in Ola

The money is starting to flow from India’s largest startup exit. Ola has added a major name to its ongoing financing round after it confirmed that Flipkart co-founder Sachin Bansal has invested 650 crore INR (around $92 million) into the Indian ride-hailing business.

The deal rumored in January when Paper.vc, an intelligence service that sifts through company filings in India, noticed that Bansal had committed to investing 150 crore. Today, eight-year-old Ola not only confirmed the pairing, but it revealed that the actual size of Bansal’s investment is significantly higher. It represents his most prominent and largest investment to date, and his first major deal since he left Flipkart following its sale to Walmart for $16 billion last year.

The investment is part of an ongoing Series J round of financing that is likely to exceed $1 billion and would value Ola, which competes fiercely with Uber in India, at around $6 billion. Bansal’s commitment comes a month after existing investor Steadview Capital put $75 million towards the round.

Here’s what Bansal — who started Flipkart with co-founder Binny Bansal in 2007 — had to say on the deal:

Ola is one of India’s most promising consumer businesses, that is creating deep impact and lasting value for the ecosystem. On one hand, they have emerged as a global force in the mobility space and on the other, they continue to build deeper for various needs of a billion Indians through their platform, becoming a trusted household name today.

I have known Bhavish as an entrepreneur and as a friend over these years and I have great respect for what he and the team at Ola have built in just 8 years! I am personally thrilled to be part of the Ola journey and I look forward to contributing to their success.

Aggarwal, Ola’s CEO, in turn, lauded Bansal as “an icon of entrepreneurship.”

“His investment is a huge encouragement for all of us at Ola and our mission to serve a billion people,” he said in a statement. “I personally look forward to learning from Sachin’s journey, his mentorship and guidance, as we look to build one of the most impactful global businesses out of India.”

Ola is locked in a dog fight with Uber, which has made India its highest priority market outside of the U.S. Uber started slowly in India, but it is pushing hard in the country having opened a dedicated local R&D center and hired a country management team that operates outside of the rest of its Asia Pacific business.

To battle its U.S. rival, Ola has expanded nationwide to cover over 100 cities and towns. It has also expanded beyond just cars, developed its own mobile money service, invested in other startups and pushed other strategies to appeal to local customers.

Flipkart’s exit money may be moving back into the ecosystem, but the company is running without the two men who founded it. Sachin Bansal left around the time of the deal while Binny Bansal (the two are not related) resigned following an incident of “serious personal misconduct” just months after the Walmart acquisition was finalized.

Binny has set up a fund — expect to see more Walmart capital flowing back into Indian startups — but his newest project is a venture aimed at helping India’s most promising founders to scale their businesses.

Amazon’s New York City Deal Was Killed By a Cocktail of Hubris and Miscalculations

Amazon isn’t an unstoppable beast after all. It was beaten in New York City by its own hubris and miscalculations.

After facing local opposition to its plan to open a large corporate office in New York, Amazon said on Thursday that it was dropping the idea altogether, along with a pledge to hire up to 25,000 for its new location over a period of years. Whether Amazon’s pullout is good or bad for New York City will be debated tirelessly by politicians and urban residents for months. It is a clear loss for Amazon and a wake-up call for all tech companies.

Amazon misjudged by setting inflated expectations for what its “HQ2” could deliver. The company had a yearlong beauty contest for hundreds of cities in North America, promising that their months of efforts to answer Amazon’s voluminous requests for information and their many promises of tax breaks would be rewarded with up to 50,000 jobs and bragging rights for having landed a corporate resident of Amazon’s stature.

Then it turned out that Amazon’s co-equal headquarters was split effectively into three — with New York City, the Washington area and Nashville each landing new Amazon branch offices. This split decision was a bit of a letdown after Amazon held a public municipal contest for the company’s affection.

After all that buildup, the letdown was palpable. Amazon was promised up to $3 billion in tax breaks and other incentives from the city and state of New York, and that headline number added fuel to concerns that Amazon would take more from New York City than it would contribute to a city already grappling with income inequality and overtaxed infrastructure. The editorial pages of both the New York Times and the Wall Street Journal — which don’t tend to agree on anything — each came out in opposition to Amazon’s deal with New York.

It didn’t help that Amazon’s announcement of its site selection coincided with the election of a new wave of Democrats in New York City who were more skeptical of corporate largesse. Amazon simply misread the mood in New York City, as did the governor and mayor that Amazon had courted to its side.

But this tale is about more than Amazon, and more than the peculiar politics of New York City. As Amazon CEO Jeff Bezos is finding out in his personal life, Amazon’s growing size, profile and influence come with a side effect of unwanted attention. That has been true for all the U.S. technology companies in the last few years.

The HQ2 failure in New York should prompt soul searching at Amazon, and it serves as a warning to all powerful technology companies: No longer will they be welcomed with unquestioned open arms in any city, state or country where they want to do business. There will be no hero’s welcome for technology giants no matter where they go. This is the new reality for big tech. Welcome to the techlash.

Alibaba’s Ant Financial buys UK currency exchange giant WorldFirst reportedly for around $700M

Ant Financial, the financial services behemoth affiliated with Chinese e-commerce giant Alibaba, has made its first big move into Europe. It’s acquired London-headquartered payments company WorldFirst in a deal that sources tell us is valued at around $700 million.

(That price would also line up with multiple reports from December claiming the two were in talks for an acquisition of around £550 million, or $717 million at current exchange rates.)

This isn’t your average multi-hundred million dollar acquisition. The deal was confirmed by WorldFirst in a note to customers while Alibaba, which curiously didn’t put out an official press release, acknowledged the acquisition to us through a spokesperson.

Yet despite a relatively under-the-radar outing, the deal has potentially significant consequences. It not only underscores the strong market connections between China and Europe, but also the margin (and thus strategic) pressures that many smaller remittance companies are under in the wake of larger companies like Amazon building its own money-moving services, as well as competition from local players in Asia.

One of a number of globally active money remittance services, 15-year-old WorldFirst lets businesses and consumers move money between countries at prices that are lower than regular banks.

The company claims to have transferred over £70 billion ($90 billion) for customers since 2004, with more than one million transfers made each year. WorldFirst is a player in the competitive remittance market, in which migrant workers send money home to family, who can make transfers online or in person at WorldFirst outlets.

Ant Financial is best known for its Alipay service, which is China’s dominant mobile payment app with over 550 million registered users. Alibaba owns one-third of Ant, which is valued at as much as $150 billion, and it has been pushing to expand its empire outside of China and beyond Asia Pacific, too.

“Alipay and WorldFirst’s capabilities and international footprints are highly complementary,” WorldFirst co-founder and chief executive Jonathan Quin wrote in an internal memo obtained by TechCrunch.

According to Quin, WorldFirst will retain its brand and become a wholly-owned subsidiary of Ant Financial. Many merchants in the UK already accept Alipay, which has expanded to cater for Chinese tourists spending money overseas.

“The tie-up will add WorldFirst’s international online payments and virtual account products to Alipay’s range of technology solutions,” an Ant Financial spokesperson told TechCrunch without disclosing the size of the buyout.

WorldFirst has been financed by private equity investors and, as a private company, it keeps its financial details closely held, but in August 2018 it noted that it had transferred more than $95 billion for some 160,000 customers — businesses and individuals included. A source told us its GMV was around $10 billion a year.

But sources noted that it was under pressure of its own that would have made securing a deal with Ant even more of a priority.

“That whole sector of payments from the West to China sellers for e-commerce is under massive margin pressure from Amazon going direct with its own service, plus new China based entrants PingPong, LianLian and Airwallex,” one executive very close to the remittance space told us. “WorldFirst had recently seen low to declining growth because of this.” Another source said that it had been shopping itself around.

(The Amazon reference is related to Amazon PayCode, a new service it has built with Western Union to let people in markets where Amazon has not launched a local site to pay for goods in local currencies on its platform. The deal was first announced in October last year, and has seen the two companies offering payment alternatives in places like Thailand and Kenya to remove the need to transfer payments in other ways, via Alipay or whatever transfer service a seller or buyer might use.)

The acquisition gives Ant Financial a massive international boost, and for the first time a presence in Europe, but it comes amid some stumbles for the company in its other attempts to expand internationally.

Notably, the company agreed to acquire Nasdaq-listed MoneyGram for $1.2 billion in 2017 after it won a bidding war for the global payment company. Ultimately, however, the deal was blocked by the U.S. government. Bruised by the episode, which set its plans back by a year, Ant went on to raise an enormous $14 billion funding round last summer during which time it presumably kicked off the search for a MoneyGram alternative.

While WorldFirst is based out of the UK, the company last year made a key move to expand its US operations when it was announced in August that it would acquire the retail money transfer business of San Francisco-based startup Wyre, which had built the network on blockchain technology but was selling it to focus on the other side of its business, providing currency exchange APIs to larger B2B customers.

It looked like all systems go for WorldFirst to move deeper in the US after that. But then, the company abruptly announced on February 20 that it planned to close the U.S-based business. The move may have been made to prevent a repeat of that scuppered MoneyGram acquisition.

WorldFirst is closing its business in the U.S. in a move widely seen as a precursor to its acquisition by Ant Financial

Outside of the U.S. and China, Ant Financial has aggressively expanded its presence in Asia through a series of investment deals that have seen it put $200 million into Kakao Pay in Korea, and find similar deals in Southeast Asia. The overall strategy appears to be to replicate the success of Alipay in China, where it offers mobile payments and digital financial services that cover loans, banking and wealth management.

In a show of its global ambition, Alipay just this week announced a deal to bring its payment option to U.S. Walgreens stores. A previous partnership with point-of-sale company First Data added Alipay to four million retail partners Stateside, and the company has similar deals in Europe and parts of Asia.

It isn’t just apps. China’s cinemas broke records during Lunar New Year

China celebrated Lunar New Year last week as hundreds of millions of people travelled to their hometowns. While many had longed to see their separated loved ones, others dreaded the weeklong holiday as relatives awkwardly caught up with them with questions like: “Why are you not married? How much do you earn?”

Luckily, there are ways to survive the festive time in this digital age. Smartphone usage during this period has historically surged. Short video app TikTok’s China version Douyin noticeably took off by acquiring 42 million new users over the first week of last year’s holiday, a report from data analytics firm QuestMobile shows. Tencent’s mobile game blockbuster Honor of Kings similarly gained 76 percent DAUs during that time, according to another QuestMobile report.

People also hid away by immersing themselves in the cinema during the Lunar New Year, a movie-going period akin to the American holiday season. This year, China wrapped up the first six days of the New Year with a record-breaking 5.8 billion ($860 million) yuan box office, according to data collected by Maoyan, Alibaba’s movie ticketing service slated for an initial public offering.

The new benchmark, however, did not reflect an expanding viewership. Rather, it came from price hikes in movie tickets, market research firm EntGroup suggests. On the first day of Year of the Pig, tickets were sold at an average of 45 yuan ($6.65), up from 39 yuan last year. That certainly put some price-sensitive audience off — though not by a huge margin as there wasn’t much to do otherwise. (Shops were closed. Fireworks and firecrackers, which are traditionally set off during the New Year to drive bad spirits away, are also banned in most Chinese cities for safety concerns.) Cinemas across China sold 31.69 million tickets on the first day, a slight decline from last year’s 32.63 million.

Dawn of Chinese sci-fi

wandering earth 2

Image source: The Wandering Earth via Weibo

Many Chinese companies don’t return to work until this Thursday, so the box office results are still being announced. Investment bank Nomura put the estimated total at 6.2 billion yuan. What’s also noticeable about this year’s film-inspired holiday peak is the fervor that sci-fi The Wandering Earth whipped up.

American audiences may find in the Chinese film elements of Interstellar’s space adventures, but The Wandering Earth will likely resonate better with the Chinese audience. Adapted from the novel of Hugo Award-winning Chinese author Liu Cixin, the film tells the story of the human race seeking a new home as the aging sun is about to devour the earth. A group of Chinese astronauts, scientists and soldiers eventually work out a plan to postpone the apocalypse — a plot deemed to have stoke Chinese viewers’ sense of pride, though the rescue also involves participation from other nations.

The film, featuring convincing special effects, is also widely heralded as the dawn of Chinese-made sci-fi films. The sensation gave rise to a wave of patriotic online reviews like “If you are Chinese, go watch The Wandering Earth” though it’s unclear whether the discourse was genuine or have been manipulated.

Alibaba’s movie powerhouse

This record-smashing holiday has also been a big win for Alibaba, the Chinese internet outfit best known for ecommerce and increasingly cloud computing. Its content production segment Alibaba Pictures has backed five of the movies screened during the holiday, one of which being the blockbuster The Wandering Earth that also counts Tencent as an investor.

Tech giants with online streaming services are on course to upend China’s film and entertainment industry, a sector traditionally controlled by old-school production houses. In its most recent quarter, Alibaba increased its stake to take majority control in Alibaba Pictures, the film production business it acquired in 2014. Tencent and Baidu have also spent big bucks on content creation. While Tencent zooms in on video games and anime, Baidu’s Netflix-style video site iQiyi has received wide acclaim for house-produced dramas like Yanxi Palace, a smash hit drama about backstabbing concubines that was streamed over 15 billion times.

Seeing all the entertainment options on the table, the Chinese government made a pre-emptive move against the private players by introducing a news app designed for propaganda purposes in the weeks leading to the vacation.

“The timing of the publishing of this app might be linked to the upcoming Chinese New Year Festival, which the Chinese Communist Party sees as an opportunity and a necessity to spread their ideology,” Kristin Shi-Kupfer, director of German think tank MERICS, told TechCrunch earlier. “[It] may be hoping that people would use the holiday season to take a closer look, but probably also knowing that most people would rather choose other sources to relax, consume and travel.”

Techstars and Starburst Aerospace are launching a space industry accelerator in Los Angeles

With the help of NASA’s Jet Propulsion Lab, the U.S. Air Force, Lockheed Martin, Maxar Technologies, SAIC and the Israel Aerospace Industries company, Techstars and Starburst Aerospace are launching an accelerator focused on the space industry in Los Angeles.

Already a major hub for the space and aerospace startup industry, with companies like SpaceX, Relativity Space, Virgin Orbit, Rocket Lab, Phase Four, and others calling Los Angeles home, the new accelerator will provide another booster for LA’s growing startup scene.

The new aerospace program, called the Techstars Starburst Space Accelerator, will be managed by longtime Techstars managing director, Matt Kozlov, who previously helmed Techstars’ efforts at its health-focused accelerator done in partnership with Cedars Sinai.

Van Espahbodi, the co-founder and managing director of Starburst Aerospace, a multinational aerospace investor and consultant, will be advising Kozlov on the program and bringing his firm’s expertise with government partners to the table.

Corporate sponsors for this program include, NASA’s Jet Propulsion Laboratory, Lockheed Martin, Maxar Technologies, SAIC and Israel Aerospace Industries, and the U.S. Air Force.

Investments in space and aerospace technologies are picking up, thanks in part to estimates like the one from Bank of America Merrill Lynch, which put the size of the space economy at roughly $3 trillion by 2045.

Even if those estimates are overblown, investor have already backed companies developing reusable rockets, 3D printing technologies, advanced materials, miniature satellites and other space-related technologies to the tune of at least $2.3 billion over the last year.

“The space industry is both massively exciting but also quite complex,” said Matt Kozlov, managing director of the Techstars Starburst Space Accelerator program, in a statement. “We are bringing together vital industry leaders, both public and private, who will help entrepreneurs navigate the industry and provide unprecedented commercial support and mentorship. We will help founders achieve two years of commercial traction in three months. Given the pedigree of our sponsors, I expect this program will very quickly become a vital resource for entrepreneurs building frontier tech.”

Applications for the accelerator are open today and the program will begin in July. And startup companies looking to connect with program staff prior to applying, or get feedback on their companies – are welcome to request Office Hours.

“The list of incredible companies just keeps growing,” said Espahbodi, the co-founder and managing director of Starburst, in a statement. “The broader aerospace industry has finally embraced the notion of ‘open innovation’ by partnering with entrepreneurs to co-develop products, with a compelling business plan to match. Starburst is excited to advise the program to ensure early-stage businesses have the appropriate tools to compete in this emerging marketplace.”

BeliMobilGue raises $10M for its used-car sales platform in Indonesia

BeliMobilGue, a used car sales platform in Indonesia, has fueled up with a $10 million Series round for the race to dominate the automotive market in Southeast Asia’s largest economy.

The company was started in 2017 as a joint venture between Europe’s Frontier Car Group (FCG) and Intudo Ventures, a VC firm focused on Indonesia. BeliMobilGue said today that the capital came from FCG and new investors, which include Tunas Toyota — the authorized dealership for Toyota cars in Indonesia.

It’s worth noting that FCG itself is a venture which, as the name sounds, develops on automotive ventures in emerging (frontier) markets in Latin America, Asia and Africa. Its investors include Naspers/OLX, Balderton Capital, TPG Growth and Partech Ventures.

This Series A round follows a $3.7 million round last year for BeliMobilGue — which means ‘buy my car’ in Indonesia’s Bahasa language.

BeliMobilGue is aimed at making it easy for car owners to sell their vehicle.

The first step is an online price estimation for vehicle. If the owner is happy with the valuation, BeliMobilGue takes the vehicles in and, after a one hour check attended in person by its testers, it arranges a sale to its network of over 1,000 dealers and private buyers. The entire process is targeted at one hour and is free for consumers, BeliMobilGue CEO Rolf Monteiro told TechCrunch.

The company has 30 physical testing points across Jakarta, Indonesia’s capital city, and with this money in the bank it is targeting expansion to Java. By the end of this year, Monteiro forecasts that the number of physical stations will have passed 100.

Another target for this year is ancillary services. BeliMobilGue is focused on enabling dealers, many of whom are often small businesses rather than nationwide chains, to growth with its service so it is offering financial packages financed by a third-party bank.

“The difference between small and large dealerships is their access to capital,” Monteiro explained in an interview. “We are a little bit more comfortable [than a bank] to extend their finance because we’re not just using data, we’re sitting on that dealer relationship.

“Plus we are sitting on cars, so we are financing cars that come from our platform and [if necessary] we can help offload the car for the dealer,” he added.

BeliMobilGue aims to sell vehicles within an hour, that includes a comprehensive inspection that’s carried out by its staff and covers 300 points.

BeliMobilGue is far from alone in going after Indonesia, which is the world’s fourth most populous country and the cornerstone of most digital strategies for the region. An annual report from Google and Temasek forecasts that Indonesia’s online economy will grow to $100 billion by 2025 from $8 billion in 2015. Southeast Asia as a whole is predicted to reach $240 billion, which is telling of the significance of Indonesia.

With that in mind, regional rivals have doubled down on Indonesia.

Carro has raised $78 million to date — including a $60 million Series B last year — while Carsome has $27 million and iCar Asia, from venture builder Catcha, has pulled in $39 million to date.

Each of that trio serves multiple markets across the region, not Indonesia exclusively, which is where Monteiro believes he can find an advantage. While he admitted that BeliMobilGue could have raised more money — it stuck to finding ‘smart money’ over amassing pools of cash, he said — he sees the existance of competition as win-win for the industry.

“Indonesia is a massive market,” he said. “Whether it is us, Carro or Carsome, the competition helps educate the market and it will get us new business. But, as much as I welcome them, I want that dominant position.”

Adding strategic investors like Tunas Toyota is, Monteiro believes another key differentiator.

“An investor like Tunas has 25-30 years of experience, so, for us, this partnership is golden. We’re quite content with the round and how it played out,” he said.