Published: 12/10/2020

Good morning folks- it's Thursday and we're covering something for the first time in the newsletter's history- an IPO! PubMatic, a company that has its origins in India has gone public today. In other news, we have a not so well known company raising capital for the first time in 8 years! (We also had another huge IPO in the DoorDash IPO and jeez I surely can't believe what they're valued at currently).

  • https://cnb.cx/3nh4e61: PubMatic goes public today
  • ➡️ So I couldn't find many Indian tech publications that covered this IPO today, which honestly is a little sad since, as far as I know, this was the first Indian tech IPO in a while. But PubMatic, an AdTech company, started trading on the NASDAQ today opening at $25.12 after being priced at $20 and ended the day at $29.45.

    ➡️ The company was started way back in 2004 and was initially a part of Komli before being hived off in 2008. The company had raised several rounds of funding, starting with a $7M Series A in 2008 led by Nexus Venture Partners and has raised a total of $63M. At the time of the IPO, Nexus owned about 25% of the companies' shares with fellow Indian VC Helion Venture Partners owning about 19%

    ➡️ The company allows publishers and app developers to sell advertising space to advertisers across different media, including display or video ads on desktop, mobile app, mobile web, or connected TV. The company generated $127M in revenue in the year ending in Sep and was up 33% YoY. They also have several large customers like Verizon Media Group (responsible for 21% of their revenue in the first 9 months of 2020), News Corp, Zynga and EA.

    ➡️ They certainly have some concentration of their revenues to a small set of customer but this is inherently unique to the company and several software companies who've IPO'd in the past have had a singular customer contributing significantly to their revenues (Twilio & Uber, and TikTok & Fastly).

    ➡️ I'm no expert in AdTech but it seems impressive that PubMatic has been able to continually grow over the years despite Google being the giant in the space. The CNBC piece goes into more depth into the company and is def a great read. And my oh my, Nexus seems to be having a great year in India- an IPO, a company being SPAC'd, a couple of early investments becoming Unicorns & a huge M&A outcome in EdTech.

    2. https://bit.ly/3qKZI1J: Exotel raises 40 Cr from A91 Partners

    ➡️ Communications Platform as a Service Exotel has raised 40 Cr from A91 Partners in a mix of primary and secondary shares as the company is seeing a wave of accelerated growth in digital adoption due to the pandemic. The company has previously only raised one round of funding, back in 2012, when it raised 2.5 Cr from Mumbai Angels and Blume Ventures

    ➡️ The most impressive thing about Exotel is probably the fact that the company has grown to 120 Cr in revenues (FY20) on just 2.5 Cr of total capital raised. Currently 80% of the company's revenues come from India, with a presence in SEA- which is poised to grow faster in the coming years. A portion of the capital will go to providing exits to the early angels, while another 1.5 Cr will go to the employees (ESOP buybacks).

    ➡️ It's also super impressive that Exotel has been able to grow consistently year after year re-investing profits into the business. And while the pandemic has sped up the digital transformation of several industries- it makes sense that the company has looked towards venture capital to capitalize on the opportunity and look to speed up their growth.

    ➡️ The company now facilitates 4B cloud calls a year, so you can see how this a company that has achieved massive scale with relatively few resources. And if we look at Twilio's journey and especially this last year, its hard to not be bullish on Exotel (one of India's first Infrastructure API companies).

    Feedback & ❤️ always appreciated BONUS (Tweet of the day): https://twitter.com/shobhitic/status/1336896438945529857

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