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UK enters recession after GDP plunged by a record 20.4% in the second quarter

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An advertising board displaying official coronavirus test-and-trace advice from the U.K. government.

Mike Kemp | In PIctures via Getty Images

The U.K. economy contracted by 20.4% in the second quarter of 2020, compared to the previous three months, as coronavirus-induced lockdowns hammered activity, according to preliminary figures released Wednesday.

GDP (gross domestic product) expanded by 8.7% in June as government lockdown measures eased, having shown a meek 1.8% recovery in May following April’s 20.4% contraction.

The second-quarter plunge is the worst on record and follows a 2.2% contraction in the first quarter. Analysts had expected a fall of 20.5%, according to a Reuters poll. Two consecutive periods of contraction mean the British economy is now in a technical rescission

Services, construction and production all saw record quarterly falls, particularly in the sectors most exposed to government restrictions, according to the Office for National Statistics (ONS).

“The economy began to bounce back in June with shops reopening, factories beginning to ramp up production and housebuilding continuing to recover,” ONS Deputy National Statistical for Economic Statistics Jonathan Athow said.

“Despite this, GDP in June still remains a sixth below its level in February, before the virus struck.”

In level terms, real GDP was last lower in the second quarter of 2003, while compared with the second quarter of 2019, the U.K. economy tumbled by 21.7%.

The ONS noted that its estimates are subject to greater uncertainty than usual, owing to the difficulties faced in data gathering due to public health restrictions.

Source: https://www.cnbc.com/2020/08/12/uk-gdp-plunged-by-a-record-20point4percent-in-the-second-quarter.html

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Illumina Buys Out Big Investors With $8B Acquisition Of Grail

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Gene sequencing firm Illumina announced plans on Monday to buy cancer screening startup Grail in a cash-and-stock deal worth $8 billion.

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Grail (Nasdaq: GRAL) was founded in 2016 by San Diego-based Illumina as a separate company and had raised about $2 billion, with investors including Amazon’s Jeff Bezos and Microsoft co-founder Bill Gates. The deal comes weeks after Grail filed to go public.

Illumina (Nasdaq: ILMN) is Grail’s largest shareholder, holding a 14.5 percent stake. Grail stockholders, including Illumina, will receive $3.5 billion in cash and $4.5 billion in shares of Illumina stock, the companies said on Monday.

Illustration: Li-Anne Dias.

Crunchbase News’ top picks of the news to stay current in the VC and startup world.

Cashierless checkout won’t merely restructure retail business models: It will disrupt the entire payments industry.

Markets have been rewarding companies with low carbon footprints, and penalizing those with high fossil fuel consumption.

Source: https://news.crunchbase.com/news/illumina-buys-out-big-investors-with-8b-acquisition-of-grail/

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Y Combinator Releases Data On Black, Latinx And Woman Founders

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Y Combinator today released three new lists on Black-, Latinx– and women-founded portfolio companies as a part of its startup directory designed to allow investors to seek out and invest in these companies. 

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“Today, we’re launching three new directory sections. In the aftermath of the recent Black Lives Matter protests, we’ve had many discussions within our community about how we can better support historically underrepresented founders,” Geoff Ralston, president at Y Combinator, wrote in a blog post

Founders of Y Combinator companies are self-reporting this data. Over time, more companies will be added, but as of Sept. 21, 2020, the overall stats are as follows: 

  • YC’s Black-founded companies have a combined valuation of $2.08 billion and raised $483 million (101 companies, 64 U.S. based).
  • YC’s Latinx-founded companies have a combined valuation of $13.5 billion and raised $3.9 billion (153 companies, 67 U.S. based)
  • YC companies founded by women have a combined valuation of $8.03 billion and raised $2.2 billion (256 companies, 202 U.S. based)

These findings reflect Y Combinator’s investments across the globe. Companies in the top 100 listed in Y Combinators directory include Quero Education, Rappi, Brex, Faire and Grin that are Latinx founded. Gingko Bioworks, PlanGrid, Lever and Front are founded by women. Embark Trucks, Twitch and Flutterwave have Black founders. 

Crunchbase adds Diversity Spotlight tags

Crunchbase recently launched Diversity Spotlight tagging for companies with underrepresented founders. The goal is to provide a single solution for the tech industry to source and fund companies with underrepresented founders. This data in Crunchbase is for U.S. headquartered companies to start. 

Y Combinator summer 2020 batch

Y Combinator launched its first program in 2005 with 10 companies. It has since hosted 31 batches over the past 16 years, with its most recent 2020 batch this summer hosting 198 companies virtually. 

The founder demographics for the most recent summer batch, according to YC, are as follows:

  • Women founders: 16 percent of the companies have a woman as a founder; 9 percent of the founders are women.
  • Black founders: 6 percent of the companies have a Black founder; 4 percent of the founders are Black.
  • Latinx founders: 10 percent of the companies have a Latinx founder; 10 percent of the founders are Latinx.

Will other investors follow suit on disclosing these numbers? You can see Diversity Spotlight tags added to U.S.-headquartered Y Combinator companies here.

Illustration: Dom Guzman

Cashierless checkout won’t merely restructure retail business models: It will disrupt the entire payments industry.

Markets have been rewarding companies with low carbon footprints, and penalizing those with high fossil fuel consumption.

Source: https://news.crunchbase.com/news/y-combinator-releases-data-on-black-latinx-and-woman-founders/

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The Crunchbase News Briefing: Mon., Sept. 21

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Here’s what you need to know today in startup and venture news, updated by the Crunchbase News staff throughout the day to keep you in the know.

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Nikola founder steps down amid regulatory probe, stock plunge

Electric truck startup Nikola Corp.’s shares fell as much as 37 percent in pre-market trading Monday. The plunge took place amid an SEC regulatory probe which has prompted company founder and chairman Trevor Milton to step down, according to reports.

In a statement, Milton wrote, “Nikola is truly in my blood and always will be, and the focus should be on the company and its world-changing mission, not me. So I made the difficult decision to approach the board and volunteer to step aside.”

Milton has been replaced by Stephen Girsky, the former General Motors vice chairman who oversaw Nikola’s stock listing and helped broker their partnership with the Detroit mega-corporation.

Nikola’s falling stocks have impacted General Motors, which took an 11 percent equity stake in Nikola earlier this month. GM officials said the company will continue to finalize its deal with the startup after Milton’s departure.

Playco raises $100M for gaming platform

Playco, a  newly launched developer of  instant games across a variety of platforms, has raised $100 million in a Series A funding round at a reported valuation of just over $1 billion.

The Tokyo-headquartered startup created by Game Closure co-founder Michael Carter and Zynga co-founder Justin Waldron.

Sequoia Capital and Mino Games founder Josh Buckley led the round, which comes as digital gaming sees continued strong growth as people seek more at-home activities amid the COVID-19 pandemic.

Other news

TikTok deal gets early nod, but ByteDance will hold as subsidiary: China’s ByteDance said on Monday that TikTok’s global business will become its subsidiary, even as Oracle and Walmart said over the weekend that they and U.S. investors would own the majority of the video app following a deal with the Trump administration.

Funding rounds

  • Mobile Premier League raises $90M: India-based gaming startup Mobile Premier League raised $90 million in a Series C round led by SIG, early-stage tech investor RTP Global, and MDI Ventures.
  • Marco Financial secures $26M: Marco Financial, a Miami-based financing platform built for small and medium-sized Latin American exporters selling to U.S. buyers, announced $26 million in pre-seed funding and credit. The funding includes an equity round, led by Struck Capital and Antler, and a credit facility underwritten by Arcadia Funds, LLC.
  • Ahana raises additional $2.3M: Ahana, the self-service analytics company for Presto, announced an additional $2.3 million in seed funding led by new investor Lux Capital with participation from existing investor GV, bringing total funds raised to $4.8 million. The San Mateo, California-based company raised the first part of the seed round in June led by GV. Presto software is an open-source distributed SQL query engine for big data.

Illustration: Dom Guzman

Gene sequencing firm Illumina plans to buy cancer screening startup Grail in a cash-and-stock deal worth $8 billion.

Markets have been rewarding companies with low carbon footprints, and penalizing those with high fossil fuel consumption.

Source: https://news.crunchbase.com/news/briefing-9-21-20/

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