Hey folks!

Bengaluru, the sixth most congested city in the world, just can’t seem to escape its infamous traffic jams. Its roads are a mess during rush hours.

But here’s a glimmer of hope. An entrepreneur from the city just shared a cool idea on X (formerly Twitter) that he picked up from Beijing, that might just help Bengalurueans navigate these traffic nightmares.

Apparently, in Beijing you can actually pay $60 to get a “traffic rescue”. Essentially, someone shows up on a motorbike to whisk you away while another person drives your car to your destination. Sounds like a dream, right?

But it does make us wonder—will this idea fly in Bengaluru? What if the rescuer ends up stuck in traffic too? 😂

Here's a soundtrack to put you in the mood 🎵

Simple Kind of Love by Nikhil D'souza

Ready to roll?

A couple of things caught our eye this week 👀

Will the global IT outage hurt insurance companies?

Last week, we told you about the infamous CrowdStrike update that didn’t play nice with Windows computers, causing a global tech headache.

And well, we're diving back in again because insurance companies are feeling the heat with claims potentially reaching billions of dollars!

In fact, at Berkshire Hathaway’s annual investor meeting earlier this year, Warren Buffett and his top insurance executive Ajit Jain had warned about the big risks in cyber insurance. And it looks like that's becoming a reality.

But don't panic just yet. Fitch Ratings is here with some calming news.

They believe that the insurance and reinsurance market can weather the storm caused by the CrowdStrike glitch. So, what's keeping things from spiralling out of control, you ask?

For starters, while the outage was a big deal, affecting around 8.5 million Windows computers, it’s actually less than 1% of all Windows computers worldwide. Still a big number, but not as catastrophic as it might sound.

And then there's this thing called reinsurance. Think of it as insurance for insurers. Basically, it helps spread the risk when things go south. So, even if the outage caused a potential $5 billion hit to Fortune 500 companies (500 of the largest US companies) except Microsoft, insurers aren’t too worried.

In this case though, primary insurers might handle most of the claims on their own because cyber insurance policies have certain conditions that help keep their losses in check. They might not even have to knock on the reinsurers’ doors.

One big factor is something called “time element periods”. This means that businesses need to be out of action for a certain amount of time, say 8 to 12 hours, before insurance kicks in. If they were back up and running quicker, their losses may not be covered.

Plus, pesky high deductibles mean that businesses have to first pay up a certain amount of money to cover a chunk of their losses themselves before the insurance company covers it. This softens the blow for insurance companies.

And finally, the outage hit places like Australia and the Pacific Asia region during work hours, but in the US, it happened overnight. This meant that a lot of businesses got back online before their day even started. And now, CrowdStrike’s CEO George Kurtz says that over 97% of Windows sensors are back online.

So, the bulk of the claims are likely to come from hospitals and airlines that needed to stay up and running 24/7.

But hey, this is just an early look at how the outage might affect the insurance world. And we’ll only have to wait and see what the full impact turns out to be.

***

Amazon wants to join the quick commerce party

Amazon is eyeing a buyout of Instamart, Swiggy’s quick commerce arm. But none of these quick commerce businesses in India are raking in profits just yet. So why’s Amazon so keen on diving into this space?

Well, Amazon’s move might not be about directly competing with quick commerce giants like Zepto or Blinkit. Instead, it’s all about the bigger picture.

These quick commerce players are expanding their product range to include higher-margin items like electronics. This strategy boosts their revenue and helps cover costs, inching them closer to profitability.

So even if you might not want a hair dryer or a pair of earphones in under 30 minutes, you might still snag these from a quick commerce store if they’re cheaper. And if you're already shopping for groceries, adding these items to your cart won’t hurt. This could potentially take a bite out of Amazon and Flipkart’s business.

In fact, Flipkart’s already planning to get on the quick commerce bandwagon with its new Flipkart Minutes, even after shutting down its previous quick commerce venture, Flipkart Quick, due to sustainability issues.

With Flipkart stepping up its game, Amazon feels the pressure to act fast. And since Amazon is already late to the party, setting up a new quick commerce operation from scratch might be too slow. So, buying an established player like Instamart might make sense.

But there’s a catch. Instamart isn’t an independent app like Zepto or Blinkit. So its customer data and supply chain is integrated with Swiggy’s, which could make splitting it off tricky. Besides, Flipkart tried a similar move earlier this year and stumbled, ultimately deciding to resume things on its own.

Will Amazon manage to pull off the deal? You tell us.

Infographic 📊️

Readers Recommend 🗒️

This week our buddy Harshit Nayyar is back with another recommendation. This time he wants us to watch Cinema Marte Dum Tak, a documentary that takes us back to the golden age of pulp movies and dives into the production and economics of low budget movies back in 90s.

Thanks for the rec, Harshit!

Finshots Weekly Quiz 🧩

It’s time to announce the winner of our previous weekly quiz. And the winner is...🥁

Harsh Murugesan! Congratulations. Keep an eye on your inbox and we’ll get in touch with you soon to send over your Finshots merch. And for the rest of you, we've moved the quiz to our weekly wrapup. So make sure you answer all the questions correctly by 12 noon on August 3, 2024 (Saturday) and tune in here next week to check if you got lucky.

Anyway, that's it from us this week. We'll see you next Sunday.

Until then, don't forget to tell us what you thought of today's newsletter. And send us your book, music, business movies, documentaries or podcast recommendations. We'll feature them in the newsletter! Just hit reply to this email (or if you're reading this on the web, drop us a message: morning@finshots.in).

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