“EDITION 30”

Published: 6/5/2020

“EDITION 30”

And yet another week is over (dw I didn’t take any naps today) so this is going out kinda on time. Seems like everyone was tuned in to the PM’s speech on COVID (I haven’t seen it yet so no spoilers) and while I don’t think a single day curfew would do anything, maybe it’ll help ease India into a longer duration curfew in the next week or so! And for today’s news, a company making hard decisions to survive in these times, and another company launching an unlikely product at an unlikely time:

  • https://bit.ly/2U2RELl (Entrackr): Bounce layoffs 120 people
  • In what I would assume was a very hard decision for the company, Bounce has laid off about 20% of their company in a bid to conserve capital in these difficult times.
  • With people staying in more & state and central governments calling for social distancing & quarantining, mobility companies have been hit hard and Bounce is no outlier.
  • They have made significant cuts in their “New Initiatives” team, which makes sense in these times when companies need to prolong their runways, cut costs and prepare for some brutal months.
  • Layoffs are always hard, especially in uncertain times like these where finding new jobs might not be the easiest but at least Bounce has given the employees 3 months of severance & insurance and help in finding their next job.
  • I don’t think any company enjoys firing people but in these later stage growth fueled businesses, sometimes companies need to change how they operate when black swan events emerge. And companies who are able to cut costs, stay lean and survive these times are the ones who end up being able to deal with anything that comes their way in the future.
  • https://bit.ly/2WAD1QS (Twitter): Juno launches an American neobank
  • In a rather surprising move, Juno (an Indian company) announced their new product- a neobank in America with 2.15% APY for the first 1000 users (APY = Interest rate).
  • As someone who wants the Indian ecosystem to thrive, this move really surprises me and I personally don’t think this would end spectacularly for them.
  • Firstly while there have been a bunch of B2B businesses which have done well in the US market, I can’t think of a single consumer product that has able to launch & gain a significant userbase in the US (Zomato was probably the largest who couldn’t crack it either despite having a better UI than Yelp).
  • Secondly, this is probably one of the worst times to launch a neobank while advertising it as a high yield savings account. With the recent fed rate cuts, neobank’s APYs are dropping significantly and Juno’s 2.15% seems like a gimmick for some initial traction. It will likely drop to <1% for the rest.
  • And lastly, Juno doesn’t really have a differentiator. Most of their features are already present in some of their competitors, so I don’t know why a consumer would choose Juno (which is late to the game) over Point or Level or Chime or N26 or the other countless banks
  • I always also love to be proved wrong so will happily concede that I was wrong if Juno manages to capture a size-able user segment and build a consumer business from India that people in the US love but currently am a bit skeptical on that being the case.
  • Feedback & ❤️ always appreciated

    More on Monday :) BONUS (Tweet of the day): https://twitter.com/_sameernigam/status/1240294121375293441