1. 🌎 Climate Tech 🌈

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2. 💸 Fintech 🧑‍💻

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3.  🛒 Retail 💰

4. 📺 Media 🎦

5. 💊 Health Tech 💉

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6. Weekend reading: Worthy of your time

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7. Postcard from Napa

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Well, that was quite a week. Let's get right to the recap and your Weekend Reading. 

🎶 This week's listen from my eclectic Spotify library is the product of having fathered three girls who introduced me to Olivia Rodrigo. To borrow their parlance: Guts slaps.

All Access

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1. Mergers reemerge

2. 📺 Media 🎦 

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3. 🌎 Climate Tech 🌈

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4.  🛒 Retail 💰 

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6. 💸 Fintech 🧑‍💻

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7. Postcard from Burning Man

Welcome back! I hope your Labor Days were filled with the leisure and beverages of your choice. There was no lack of news this four-day week, so let's get to it. 

We start with a look at the state of the M&A market, which seems hopeful for the first time in a long time. Also, I'm changing up the format a bit this week. Hit reply and let me know your thoughts!

🎵 Weekend reading will be back next week, but so you're not empty-handed, enjoy the latest playlist from The Amplifier. A great newsletter from the NY Times that provides cool music discovery opportunities if, like me, you don't get out much any more. 

1.  🛒 Retail 💰

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2. 🌎 Climate Tech 🌈

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3. 📺 Media 🎦

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4. 💸 Fintech 🧑‍💻

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7. Postcard from Sicily

Welcome back to your weekly recap of the week that was in Axios Pro Deals. 

🚗 Have you taken the Axios Pro Deals Tracker beta for a test drive? Reply to this email to let me know what you think.

🙏🏻 How to help Hawai'i: Several readers referred us to the Hawaii Community Foundation.

🎶 For your musical enjoyment this weekend, let me suggest some Johnny Cash. We went to the museum in Nashville this year and it provided a welcome reminder of his greatness. 

1.  🛒 Retail 💰 

an illustration of the wall street bull holding a green shopping basket in its mouth

2. 📺 Media 🎦

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3. 💊 Health Tech 💉

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4. 🌎 Climate Tech 🌈

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5. 💸 Fintech 🧑‍💻

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6. Weekend Reading

7. Postcard from Bucks County

So we had Climate Week, two big IPOs, a monolithic media presence retire, and the FTC target arguably the most popular private equity strategy. Let's get ourselves a hot cup of coffee and get right to it.

🎶 I found myself on Tom Petty radio this week, and this 1981 banger with Stevie Nicks immediately took up residence in my head.

1. 💸 Fintech 🧑‍💻

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Photo illustration of Tracy Gray with abstract money shapes and a sky background.

Photo illustration of Mark Taber surrounded by abstract shapes.

4.  🛒 Retail 💰

Illustration of advertisement on a telephone pole with ripped off tabs. The ad has “For Sale IPO"

5. 📺 Media 🎦

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7. Chart of the week: India's VC slowdown

8. Postcard from Sicily seconda parte

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👂 Situational awareness: We surveyed hundreds of dealmakers to better understand how they're thinking about current market conditions. View the results in our latest industry report.

📆 Programming note: All Axios Pro Deals newsletters will be dark from Aug. 28 through Sept. 4. Look for alerts on breaking news, but the full newsletters will return Sept. 5 and this newsletter will be back on Sept. 9.

🎶 Every now and then I'm reminded of this amazing guitar solo by Prince, and I'm never disappointed when I rewatch it. Enjoy!

Retail Deals

Zepto, an India-based grocery delivery company, secured a $200 million Series E at a $1.4 billion valuation in a deal led by Stepstone Group, CEO Aadit Palicha tells Axios. 

Driving the news: The two-year old company has grown rapidly, and has its eyes on a public offering in around 24 months. 

How it works: "Proximity matters in India," Palicha says. So the company operates more than 200 warehouses throughout the seven cities it operates in order to deliver groceries in 10 minutes or less. 

The self-described delivery-only supermarket works directly with CPG companies to source inventory.

Zepto currently operates in Mumbai, Delhi NCR, Bangalore, Chennai, Hyderabad, Pune, and Kolkata. 

Zoom in: The company's executive team brings supply chain and operating experience, which Palicha says drives the strategy. 

President Vinay Dhanani is ex-Flipkart and ITC Group, and CFO Ramesh Bafna previously worked at Myntra, Flipkart and Wipro. 

Other execs come from Uber Eats, Tata Consumer Products, Johnson & Johnson and HSBC. 

Details: Goodwater Capital joined Stepstone as a new investor, and they were joined by existing investors Glade Brook Capital, Nexus and Lachy Groom. 

Palicha says the two-year old company's most recent valuation was $900 million in May 2022's $100 million raise.

Per PitchBook, this marks India's first unicorn of 2023.

What's next: Currently at a $650 million annual sales rate, the company is tracking towards being EBITDA positive in 12-15 months, and Palicha says they plan to go public in about 24 months, likely in India.

"We have enough capital to get to profitability and continue growing, but we may raise a pre-IPO — mainly secondary — to bring onboard institutional Indian investors before the IPO," Palicha says. 

Investors deliver India's Zepto $200M Series E

Indian delivery company aims to IPO in around two years, CEO says.

Illustration of a grocery bag speeding into the frame.

Retail

Zepto, an India-based grocery delivery company, secured a $200 million Series E at a $1.4 billion valuation in a deal led by Stepstone Group, CEO Aadit Palicha tells Axios. Driving the news: The two-year old company has grown rapidly, and has its eyes on a public offering in around 24 months.

Health Tech Deals

"Deals that have been in market are getting done, but new deals are being held back," said Emily Wildes, managing director, Lincoln International, at Wednesday night's Axios Pro subscriber-only event in Chicago.

Why it matters: The dual factors of SVB's sudden collapse and rising interest rates have created a unique private equity dealmaking environment in retail health markets.

The big picture: The Lincoln International dealmaker, who focuses on retail health care, told Claire that deals have been closing and firms are taking calls. So firms are committing capital.

"When we started 2023, there was a hint of optimism in the room, and we started seeing deals in hot sectors getting done at really attractive valuations," Wildes said.

Three weeks ago there was optimism, but then she saw signs that were eerily reminiscent of 2008.

What's happening: Now, private equity firms have moved into "hunker down" mode, and no one is looking at new deals.

"Right now deals are getting done, but there is a lot of overhang," Wildes said.

Distressed and distressed-adjacent companies are being marketed on synergies, and she's seeing those come to market.

The middle market remains moribund, with those deals just not getting done.

"I've had more time on my hands in 2023 than I have since '08," Wildes said.

Yes, but: Private equity is going all in on deals in hot sectors — women's health, cardiology, behavioral health — including being really aggressive to close deals by going all equity to win the deal.

What's next: Looking to potential activity after the current crisis(es) end and the overhang begins to ease, Wildes sees cash-pay businesses as likely first movers.

"Things like medical aesthetics and veterinary, also seeing higher-end models for people focusing on functional medicine," Wildes says. "And people are going to have to get back into more rational territory for EBITDA adjustments before the market gets healthy again."

Not '08, but not great

Lincoln International MD Emily Wildes spoke to Axios Pro's Claire Rychlewski.

Axios Pro's Claire Rychlewski, left, and Lincoln International's Emily Wildes at the Axios event in Chicago this week. Photo: Christopher Dilts on behalf of Axios

Health tech deals

&quot;Deals that have been in market are getting done, but new deals are being held back,&quot; said Emily Wildes, managing director, Lincoln International, at Wednesday night&#x27;s Axios Pro subscriber-only event in Chicago.Why it matters: The dual factors of SVB&#x27;s sudden collapse and rising interest rates have created a unique private equity dealmaking environment in retail health markets.The big picture: The Lincoln International dealmaker, who focuses on retail health care, told Claire that deals have been closing and firms are taking calls. So firms are committing capital.<ul><li>&quot;When we started 2023, there was a hint of optimism in the room, and we started seeing deals in hot sectors getting done at really attractive valuations,&quot; Wildes said.</li><li>Three weeks ago there was optimism, but then she saw signs that were eerily reminiscent of 2008.</li></ul>What&#x27;s happening: Now, private equity firms have moved into &quot;hunker down&quot; mode, and no one is looking at new deals.<ul><li>&quot;Right now deals are getting done, but there is a lot of overhang,&quot; Wildes said.</li><li>Distressed and distressed-adjacent companies are being marketed on synergies, and she&#x27;s seeing those come to market.</li><li>The middle market remains moribund, with those deals just not getting done.</li><li>&quot;I&#x27;ve had more time on my hands in 2023 than I have since &#x27;08,&quot; Wildes said.</li></ul>Yes, but: Private equity is going all in on deals in hot sectors — women&#x27;s health, cardiology, behavioral health — including being really aggressive to close deals by going all equity to win the deal.What&#x27;s next: Looking to potential activity after the current crisis(es) end and the overhang begins to ease, Wildes sees cash-pay businesses as likely first movers.<ul><li>&quot;Things like medical aesthetics and veterinary, also seeing higher-end models for people focusing on functional medicine,&quot; Wildes says. &quot;And people are going to have to get back into more rational territory for EBITDA adjustments before the market gets healthy again.&quot;</li></ul>

National

Particularly common among cancer patients, "financial toxicity" is a term that's used to describe the financial strain of paying for expensive medical care. Financial planners may be the solution.

Why it matters: Patients that received financial guidance or financial assistance have a higher survival rate, according to a 2020 research study — meaning relieving crushing financial burdens may have also improved their medical outcomes.

Even when they have health insurance, cancer patients still face out-of-pocket costs — like copayments and deductibles — that can add to the emotional stress of fighting cancer, especially if they don't have a financial safety net.

The study was presented by Thomas G. Knight of the Levine Cancer Institute to the 2020 American Society of Hematologists through a grant from the Foundation for Financial Planning's Pro Bono for Cancer Campaign. 

What they did: The pilot study consisted of 105 high-risk patients who were diagnosed with blood cancers and screened positive for financial toxicity, Knight tells Axios. 

Over six months, 59 patients received the three-step intervention. 

The first step was with a nurse addressing care, by identifying any gaps and potential grants to cover costs. The second was with a pharmacist reviewing the costs of medications and considering alternative treatments or medications. The final intervention was with a community pro-bono financial planner.

The remaining 46 patients were supposed to get the intervention, but the study was stopped early due to the start of the COVID pandemic.

What they found: The intervention group had better overall survival rates than those in the standard group. 

After six months, overall survival was 81.4% for the intervention group, compared to 73.9% in the standard care group.

At the 12-month mark, overall survival was 73% for the intervention group, and 46.4% for the standard care group.

What's next: The pilot study showed how centralized financial support can help improve cancer care. The key is that the financial planners have to be members of the community themselves.

"We have to balance centralized financial navigation, while looping in folks with specialized local knowledge," Knight says.

The health benefits of easing cancer costs

One study suggests cancer patients who got help with "financial toxicity" had higher survival rates.

Illustration of abstract shapes and dollar bills.

Deep Dive - Cancer

Particularly common among cancer patients, <a class="gtmContentClick" data-vars-link-text="&quot;financial toxicity&quot;" data-vars-click-url="https://www.cancer.gov/about-cancer/managing-care/track-care-costs/financial-toxicity-pdq#:~:text=pay%20your%20bills.-,Financial%20toxicity%20describes%20problems%20a%20cancer%20patient%20has%20related%20to,financial%20problems%20for%20a%20patient." data-vars-content-id="767870b2-a162-45bf-9596-9484689b67e4" data-vars-headline="The health benefits of easing cancer costs" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.cancer.gov/about-cancer/managing-care/track-care-costs/financial-toxicity-pdq#:~:text=pay%20your%20bills.-,Financial%20toxicity%20describes%20problems%20a%20cancer%20patient%20has%20related%20to,financial%20problems%20for%20a%20patient." target="_blank">&quot;financial toxicity&quot;</a> is a term that&#x27;s used to describe the financial strain of paying for expensive medical care. Financial planners may be the solution.Why it matters: Patients that received financial guidance or financial assistance have a higher survival rate, according to a 2020 <a class="gtmContentClick" data-vars-link-text="research study" data-vars-click-url="https://www.sciencedirect.com/science/article/pii/S0006497118708690" data-vars-content-id="767870b2-a162-45bf-9596-9484689b67e4" data-vars-headline="The health benefits of easing cancer costs" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.sciencedirect.com/science/article/pii/S0006497118708690" target="_blank">research study</a> — meaning relieving crushing financial burdens may have also improved their medical outcomes.

The U.S. faces a range of health care flashpoints — unaffordable drugs, opioids, vaping — as we debate whether to adopt universal care. For now, the Affordable Care Act is the law of the land, but Republicans want to issue it a final death blow.

Health

A look at the scientific breakthroughs changing the world, explorations in space and in worlds beyond our own and the threats posed to us by our own planet, both out of our control and of our own making.

Science

Fintech Deals

If you have more than $500,000 in net worth and are under 45 years old, you probably don’t have an adviser, and you’re not alone. That was the takeaway from a Fintech roundtable at Axios’ BFD Summit yesterday.

Why it matters: That philosophy both threatens the old-school wealth management world and could see 60-40 allocation strategies go the way of the buggy whip.

The intrigue: Among the group of fintech entrepreneurs and investors Axios gathered, there was disagreement on where these funds would go. 

“We're finding wealthier people who are younger who… want to be able to construct their own portfolio, but they also want access. An adviser is more than advice, it’s access to the products that were generally not available to the retail investor,” The Coterie founder and CEO Ethan Agarwal said.

Yes, but: “You have trillions of dollars of money in motion moving from Baby Boomers to the next generation. Much of what you're hearing here is a shift in consumer behavior,” Yieldstreet founder Michael Weisz said. 

Weisz argues that 60-40 is dead and that investors demand and appreciate the steady performance of alternative assets in their portfolios. 

“There's no doubt that there's going to be more alternative assets available to individual investors, and they should have access to them, but alternative assets only work if you stick with them for a really long time,” said Insight Partners managing director Deven Parekh.

“Anything that's long term... the illiquidity simply does not work, and whatever spread you get does not compensate you for that illiquidity,” says Sanjay Raghavan, head of web3 initiatives at Roofstock.

Meanwhile, James Faucette of Morgan Stanley believes these entrepreneurs face their own threats. 

Faucette made the point that low interest rates have had a massive impact on the development of technology, giving startups a longer window to build their business. 

But as prevailing rates go higher, he believes the window for startups gets shorter. 

Young, wealthy pros overturn traditional wealth management model

Experts talk fintech strategies at Axios roundtable

Image of BFD Fintech roundtable attendees

Fintech roundtable at the Axios BFD event. Courtesy: Beatrice Moritz

Fintech

If you have more than $500,000 in net worth and are under 45 years old, you probably don’t have an adviser, and you’re not alone. That was the takeaway from a Fintech roundtable at Axios’ BFD Summit yesterday.Why it matters: That philosophy both threatens the old-school wealth management world and could see 60-40 allocation strategies go the way of the buggy whip.

Now is not the time to take a company public, Forerunner Ventures founder Kirsten Green said Thursday during an Axios Pro Insights event.

"I'm not sure I would take a company public if I was one of our portfolio companies right now. I would have said that in January and I'm certainly saying that today. The level of uncertainty just went through the roof."

Go deeper: Start your free trial to Axios Pro

Forerunner founder says IPO uncertainty "through the roof"

Forerunner just raised $1 billion for its latest VC fund.

Photo: Michael Kovac/Getty Images for WeWork

Axios Pro: Deals

Now is not the time to take a company public, Forerunner Ventures founder Kirsten Green said Thursday during an Axios Pro Insights event.<blockquote>&quot;I&#x27;m not sure I would take a company public if I was one of our portfolio companies right now. I would have said that in January and I&#x27;m certainly saying that today. The level of uncertainty just went through the roof.&quot;</blockquote>Go deeper: <a class="gtmContentClick" data-vars-link-text="Start your free trial to Axios Pro" data-vars-click-url="http://AxiosPro.com" data-vars-content-id="e4fe1855-42c6-41a6-b84b-4a3ef10e6fbd" data-vars-headline="Forerunner founder says IPO uncertainty &quot;through the roof&quot;" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="http://AxiosPro.com" target="_blank">Start your free trial to Axios Pro</a>

After a record economic expansion, the coronavirus pandemic sent the U.S. economy into a recession as unemployment soared to staggering heights. The country now faces urgent questions about how much stimulus is needed for reeling consumers and businesses, and what a recovery might look like.

George Moriarty

Stories

Investors deliver India's Zepto $200M Series E

Not '08, but not great

Young, wealthy pros overturn traditional wealth management model

The health benefits of easing cancer costs

Forerunner founder says IPO uncertainty "through the roof"

Newsletter editions

Pro Deals: 📖 Weekend reading

Pro Deals: 📖 Weekend reading

Pro Deals: 📖 Weekend reading

Pro Deals: 📖 Weekend reading

Pro Deals: 📖 Weekend reading