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10 quick key takeaways from boAt’s IPO filing

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According to a draft red herring prospectus (DRHP) that boAt Lifestyle filed today with the Securities and Exchange Board of India (SEBI), the direct-to-consumer startup says it plans to raise Rs 2,000 crore in its initial public offer via a fresh issue of shares worth Rs 900 crore, and an offer for the sale of shares (OFS) worth Rs 1,100 crore.

Here are some key takeaways from its DRHP:

1. The startup’s founders — Sameer Mehta and Aman Gupta — who own 28.26 percent, each, on a fully diluted basis are the majority shareholders with 56.52 percent stake. South Lake, a venture capital firm based in the Cayman Islands, owns 36.48 percent of the company, and will be selling equity worth Rs 800 crore in the IPO.

2. A material threat to the company’s operations that it flagged in its prospectus includes delays or disruptions in the supply of products and components from its suppliers, including those in Vietnam, India, and China. It further said that political tensions could affect its contracts and arrangements with suppliers in China.

“In the event that China is affected by any adverse conditions that disrupt production and/or deliveries from our contract manufacturers, our ability to deliver our products on a timely basis could be negatively affected, which may adversely affect our business and results of operations,” the prospectus read.

Further, it added that any new trade regulations by India or China could impact its business.

boAt has been heralded as a “Made in India“, “homegrown” D2C brand, but it says in its prospectus that while it plans to continue diversifying and building its supply chain by engaging with new Indian suppliers, it “cannot assure you that we will be able to find suitable suppliers and manufacturers in India and on acceptable terms. Engaging new suppliers may involve setting up additional measures for quality control and vetting. Further, foraying into contract manufacturing in India may also take substantial time and attention of management…”

Aman Gupta (left) and Sameer Mehta, Co-Founders, boAt

3. boAt’s primary sales channels are online marketplaces Flipkart and Amazon. In the six months ended September 30, 2021, while boAt 83.24 percent of its revenue from operations was derived from online marketplaces, a whopping 75.02 percent of its revenue from operations was derived from the top two online marketplaces.

4. For the six months ended September 30, 2021, audio products accounted for nearly 83 percent of its sales. Wearables accounted for 14.05 percent.

5. One of boAt’s chief marketing strategies is social media advertising and word-of-mouth reviews, the startup says, adding deterioration in those relationships may be a material concern for the company.

“Our target consumers may tend to value and believe readily-available information and any negative commentary could drive large-scale social media campaigns and posts against us, our products or brand and sub-brands, whether motivated or otherwise, and result in consumer boycotts, without further investigation and without regard to accuracy of facts.”

6. In the six months ended September 31, 2021, boAt spent Rs 65.7 crore in warranty expenses, far exceeding the previous year’s Rs 52.7 crore (for the full financial year). Its warranty expenses were “primarily relating to the payments made to customers under warranties provided by us for our products“.

Under boAt’s contracts with its distributors, in certain scenarios where there are high numbers of products returned by end-consumers to the distributor, boAt may be required to buy back the remaining quantity of products at the price at which it originally sold the product to the distributor.

“We cannot assure you that the rate and cost of us providing refunds or replacements will not increase in the future. Increases in the rate of product returns may lead to customer dissatisfaction, which may adversely affect our reputation, brand image, business and financial condition.

For the six months ended September 30, 2021, product replacement claims were made on 4.51 percent of its total sales orders, in respect of which 2.97 percent of its total sales orders had products which were replaced.

Also, it spent Rs 46.16 crore on advertisement and promotion over the first half of FY 2022, versus Rs 47.8 crore in the last financial year – which means boAt is ramping up its marketing, sponsorship and advertisement efforts.

“Insufficient investments in marketing and advertisements towards brand building could also erode or impede the development of our brands.”

Image source: boAt’s DRHP

7. boAt says it intends to expand into overseas markets such as the UAE, Nepal, and other Southeast Asia regions, which it believes have a large Indian diaspora with similar tastes and preferences as the audience in India. It also plans to “further penetrate” Tier II+ cities in India.

8. In 2020, the startup says it experienced delays and production and logistics for three months; in 2021, for one month. It adds it also “faced interruptions…particularly from sick personnel, leaves, quarantines and limitations in operations.”

9. The startup reported a total income of Rs 1,553.1 crore in the six months ended September 30, 2021. In FY 2021, it recorded Rs 1,320.3 crore in revenue. Total expense in HY ended September 2021 was Rs 1,394.7 crore, versus Rs 1,202.1 crore in FY ended March 31, 2021. boAt reported Rs 118.3 crore in profit for the year for the six months ended September 30, 2021, vs. profit of Rs 86.5 crore for the year ended March 31, 2021.

10. The startup says it intends to use Rs 700 crore of the total net proceeds to repay or pre-pay its loans, and the rest for general corporate purposes.

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Better together: Offsetting cybersecurity’s labor challenges with API integrations

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The labor challenges afflicting cybersecurity teams far and wide are no secret. A razor-tight hiring market coupled with surging demand and an accelerating threat landscape has created a perfect storm of complexity, resulting in a widening skills gap that is driving higher levels of burnout and human error across the sector. In fact, Verizon’s independently commissioned 2022 Data Breach Investigations Report found that 82% of breaches today involve some degree of human error. Whether it’s an unsuspecting end user or a bleary-eyed analyst, the vulnerabilities caused by cognitive overload shouldn’t be overlooked.  

Take the recent high-profile Uber data breach. A malicious actor, posing as an internal IT administrator, used digital collaboration channels to trick an Uber employee into giving up their VPN credentials, leading to a total compromise of the rideshare giant’s network infrastructure. The breach exemplified the consequences of a social engineering attack targeting the always-on hybrid workforce. And with the rate of such attacks accelerating in volume and velocity, it’s clear that more visibility of these threats is needed for security teams to effectively remediate them.

Many organizations are investing in a plethora of new, best-in-class security products in response to staffing shortages. However, reactive patchwork spending on the industry’s latest niche products shouldn’t be viewed as the answer, as the tool sprawl often creates additional complexity that hurts organizations more than it helps. Enterprises, on average, have 60 to 80 different security monitoring tools in their portfolio, many of which go unused, underutilized or forgotten. Forcing security teams to master a myriad of tools, consoles and workflows shifts priorities from managing risk to managing technology.

An integrated cybersecurity framework

The companies best positioned to offset cybersecurity’s labor challenges are those adopting best-of-breed security tools and platforms that offer a deep library of API and third-party integrations. Above all, an integrated framework empowers organizations to effectively navigate their unique environments by consolidating tools and reducing human error through the following three processes:

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  • Improved protection via security intelligence and threat sharing: This enables rapid recognition and response to incoming threats via machine learning analytics tools, strengthening a human analyst’s ability to formulate swift and comprehensive cyberdefense measures.
  • Improved efficiency via automation: This enables offloading of repetitive and mundane manual tasks to AI-enabled tools, streamlining human workflows by accelerating and improving key facets of incident response and vulnerability management.
  • Improved prevention via sharing and consolidating tool data: This enables complete, real-time visibility into an organization’s entire security environment to promote the creation of targeted alerts that uncover unknown threats.

In collaborating with a wider range of security vendors, organizations leveraging API integrations benefit from the combined knowledge of all integrated platforms to greatly improve overall security posture. The extensive access to timely threat intelligence allows security teams to align prevention, investigation and response plans across multiple security controls, as well as increase the speed of their detection and remediation efforts.

Amid the widespread adoption of cloud-based hybrid work environments, it’s increasingly clear that organizational security architectures must consist of scalable, tightly integrated solutions that combine the right balance of automated prevention, detection and response capabilities to effectively protect data across its lifecycle.

Enhancing detection and increasing cybersecurity efficacy

An open API integration framework is the embodiment of unlocking strength in numbers. It stitches together the critical functions and processes performed by foundational security tools — email security, endpoint security, web security, NDR, data security — into a single meshed framework that operates in unison and shares centralized threat intelligence data across its ecosystem. By connecting all the pieces of the puzzle, organizations gain the resources to enhance their prevention and detection capabilities in complex environments.

In one scenario, an API framework could enable automated processes to continuously flow between an email gateway and security service edge (SSE) to corresponding SIEM/XDR systems. This would allow security teams to share rich logging, metadata, indicators of compromise, malicious URLs, user activity, data movement and machine learning analytics in real time. The AI-powered SIEM platform automates the analysis of that threat data, sifting through the noise to generate actionable alerts with contextual information for security teams. Meanwhile, the real-time contextual insights provide simplified guidance for analysts to alleviate potential threats and, if needed, formulate a swift response to an attack.

With access to a wider range of threat data touchpoints, cybersecurity teams can also create customized scripts within the overarching API library. This gives them “targeted capabilities” that more directly align with their specific needs and skillsets. For instance, the team could create a script that simultaneously analyzes email security logs from Vendor A, data protection logs from Vendor B, web security click logs from Vendor C, and spam filter logs from Vendor D, based on which intel is most relevant to their specific use case. Filtering the exceedingly high volumes of incoming alerts enhances the efficiency of the entire team, empowering analysts to identify needles in the haystack by prioritizing the right alerts at the right times for maximized protection.

Automating manual processes and workflows

Despite the growing number of innovative, best-in-class products available on the market today, it’s important to remember that a multi-vector social engineering attack is exceedingly difficult for hybrid security teams to combat regardless of the tools in their stack. Quick and agile responses are non-negotiable in these situations, but with resources stretched thin and employees working from multiple locations, executing swift corrective action free of human error is easier said than done. Even the most experienced and skilled security teams are susceptible to mistakes while trying to remediate an attack. Therefore, identifying how to automate well-defined processes wherever possible is imperative for tightening these response durations and ensuring security teams can remediate quickly and effectively.

With access to an open API library, organizations can integrate the capabilities of additional AI/ML security tools into their existing security architecture to automate the repetitive steps of protection, detection, response, mitigation and intelligence sharing. Whether it’s informing an endpoint security provider of an emerging alert, or securely moving data from one storage solution to another, API-driven automation can handle the routine, error-prone tasks cybersecurity teams perform every day. Streamlining these otherwise human-centric workflows allows overstretched analysts to instead focus on more critical threat assessments requiring extensive time and attention. That, on a macro level, strengthens the security posture of the greater organization.

There’s no magic bullet that will completely reverse cybersecurity’s labor challenges in the immediate future. But there are proactive steps organizations can take now to provide the critical support their security teams need today. For effectively navigating a complex threat landscape, there’s no better place to start than with the applied adoption of a deep API integration framework.

After all, cybersecurity is a team sport. Why defend alone when you can defend together? 

Joseph Tibbetts is senior director for tech alliances and API at Mimecast.

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It’s foie gras season in unicorn land • TechCrunch

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W

elcome to the TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s inspired by the daily TechCrunch+ column where it gets its name. Want it in your inbox every Saturday? Sign up here.

With most startups getting repriced behind closed doors, we love getting data that gives us a glimpse of what’s going on. This week, our new information comes from EquityZen, which shared insights on secondary stock sales. EquityZen also put up a few IPO predictions that gave us food for thought. Let’s explore. — Anna

A glimpse of repricing

How do you know when a unicorn has lost its billion-dollar valuation? Usually you only find out long after the fact, when — and if — the company raises a down round that makes it clear that its equity valuation is no longer in the unicorn realm.

The thing is, not many founders want to advertise that they have raised capital at a lower valuation than their previous round; in most cases, they just won’t disclose their new valuation.

As market observers, this leaves us with little data on a topic that our readers do care about: What kind of repricing they could expect. This is why we were grateful for Instacart, which made it public that it reduced its valuation through a 409A price change. This wasn’t good news, but it was a helpful data point for everyone involved. However, that was back in March.



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This Top-Rated PDF Solution Is 66% Off Now

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Opinions expressed by Entrepreneur contributors are their own.

Paper has made its way largely out of business, but that doesn’t mean you don’t still work with documents regularly. Instead, we’re just working with them differently: with the dreaded PDF. These static files can be great if you’re positive that a document is ready, but a serious nightmare when you have to make changes. When you’re working with a lot of PDFs, you need a quality digital solution.



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UPDF Pro is one of the top-rated PDF solutions on the market. Geeky Gadget writes, “UPDF is a potent PDF editor and PDF converter designed to stay up with advanced technologies. It ensures that whichever features you use are up to date. UPDF not only converts PDF to Word but can perform many advanced editing.” Fossbytes adds, “UPDF doesn’t have a boring interface like other PDF software. The design is stunning and eye-catching. On top of it, it is convenient to use. You wouldn’t be bothered with a complex design that is very time-consuming.”

These are just the tip of the iceberg of positive reviews for this all-in-one PDF solution for individuals and businesses. With it, you can edit any PDF document across Windows, Mac, iOS, and Android devices, adding or deleting text, editing fonts and color, and much more. The tool allows you to add, crop, rotate, replace, extract or delete images, watermark documents, and password-protect them for elevated confidentiality. You can also easily annotate PDFs, highlight, underline, or strike out text, add shapes and notes, and much more. Finally, it’s even easy to convert any PDF to Word, Excel, PowerPoint, and a ton of other file types in just a click.

Working with PDFs has never been easier than with a lifetime subscription to UPDF Pro. Grab it on sale for 66% off $149 at just $49.99, the best price you’ll find online.

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URGENT: CYBER SECURITY UPDATE