We bring to you the latest edition of News Roundup: Indian Startup Stories Of The Week!
In one of the most important developments for the Indian startup ecosystem this week, Prime Minister Narendra Modi urged global businesses to invest in Indian startups and get best possible returns for their investments. He was speaking at the third Future Investment Initiative (FII) forum held in Riyadh on October 29.
PM Modi said that transformative technologies such as artificial intelligence and genetics have been becoming an important part of people’s lives. He emphasised that India has integrated these across various segments like hospitality, healthcare, transportation, tourism and foodtech among others, he added.
Recently, the German Chancellor Angela Merkel was in India for a three-day visit to New Delhi, to discuss the bilateral trade between the two countries, where India and Germany are likely to sign agreements for agritech and green urban mobility projects.
Further, India’s nodal body for startups, the department for promotion of industry and internal trade (DPIIT), is looking to approach the centre for approval of its comprehensive vision document to further promote startups in India.
In another update, MeitY is continuing its push for digital payments. The Ministry on October 30 sent a letter to banks and payments firms to increase their digital transactions in the financial year ending March 2020 to 45 Bn (by volume) from 40 Bn. Paytm Payments Bank and private sector lender HDFC Bank have been entrusted a large share of achieving these targets.
Here are other important news stories of the week:
Important Indian Startup News Stories Of The Week
Foodtech: Swiggy VS NRAI And More
Swiggy has been making the headlines this week as Larry Illg, CEO of Prosus Ventures (earlier Naspers Ventures) said that the Indian foodtech market is promising, and the US companies in the space should learn from the developing economies in terms of accessibility and profitability.
The National Restaurants Association of India (NRAI), on the other hand, is having a tough time with the Indian foodtech companies, and Swiggy is trying hard to resolve restaurant partners issue related to deep discounting, uneven commissions and data masking.
In addition to this, the Indian police are not happy with the food delivery companies, as they have been breaking traffic rules repeatedly, and police blames it on the unfair incentive structure.
Financials FY18 And FY19: Flipkart, ByteDance, Paytm Mall, PhonePe, Dunzo And More
- In the B2B unit, Flipkart witnessed a loss of 85.91% in the financial year 2018-2019, ending on March 31, 2019. The company has incurred a net loss of INR 3,836.8 Cr, compared to that of INR 2,063.8 Cr in FY2017-18
- Meanwhile, in its other venture, Flipkart Internet, had reported a 40% drop in its losses with INR 1,624 Cr for FY 2018-19
- The parent company of ecommerce platforms Flipkart, Myntra, Jabong; digital payments platform PhonePe and logistics company EKart, Flipkart Private Limited has finally managed to cut down its losses by 63% to INR 17,231 Cr in the financial year 2019, ending on March 31. Moreover, the company noted a 42% jump in its consolidated revenue, accounting INR 43,615 Cr.
- The China-based ByteDance kicks off its profitable journey in India with 250 Mn user base, and the company that operates video making and sharting apps like TikTok, Helo, and Vigo Video, has clocked profit in its first full year of operations, where it has generated a profit of INR 43.7 Cr ($6.16 Mn) in the FY19. The profitability is expected to encourage further investment plans of ByteDance in India.
- Paytm’s ecommerce marketplace unit, Paytm Mall had a 35% reduction in its losses to INR 1,171 Cr for FY19, compared to loss reported in FY18, INR 1,806 Cr. Revenue rose from INR 775 in FY18 to INR 968 Cr in FY19, a 25% rise from the previous year filings.
- Hyperlocal services startup, Dunzo recently claimed to be doing over 2 Mn deliveries every month. But that growth has come at such a great cost as the company is spending it more on the promotions and marketing activities, which went up to 62x in FY19. At the same time, Dunzo’s losses and overall expenses have grown 7x each.
- The digital payments company, PhonePe achieved a valuation of $7 Bn, However, the growth has come at a huge cost for the company as it reported a loss of INR 1904.72 Cr in FY19.
- ShareChat with a user base of 45 Mn monthly active users and over 100 Mn app downloads, is looking at Tier 2 and 3 markets for growth. The financials of the company has witnessed a rocky story, where FY19 has shown a loss by 11x, while it saw 14x growth in its revenue.
- The two-wheeler rental platform, Vogo claims to have completed 5 Mn trips on its platform. In the FY19, the company has grown its expenses 94x with barely 2x growth in its revenues. The company filings show that it reported a loss of INR 39.2 Cr in FY19, a 10.8x increase from INR 3.3 Cr in FY18.
- Amazon Seller Services narrowed its loss to INR 5,685 Cr for the financial year ended on March 31, 2019. The company witnessed a loss of 9.5% compared to last financial year, which stood at INR 6,287.9 Cr. Overall, the ecommerce giant’s losses in India stood at over INR 7,000 Cr in FY18-19.
- Apple India saw a drop for the first time, where the company’s operations revenue fell 19% from INR 13,049 Cr in FY18 to 10,538 Cr in FY19. Total income, on the other hand, has dropped to 18.5% from INR 13,098 Cr to INR 10,674 Cr. Net profit-wise, it saw a pitfall of 70%, INR 262 Cr compared to FY18, INR 896 Cr.
- At the earnings call, the FY19 Q4 revealed that Apple has recorded an all-time high record Mac sales in the country, and the company is optimistic about its iPhone sales in the coming days, as iPhone 11 was launched in September.
- FreshMenu, on Wednesday, claimed that it has managed to break even and is looking to achieve profitability by the end of this year. The company grew to INR 141 Cr in the FY19 with a loss of INR 39 Cr. In FY18, stood at INR 123.72 Cr with a loss at INR 43.88 Cr.
Ecommerce Policy & FDI Issues: Govt Vs Ecommerce Players
The Indian Direct Selling Association (IDSA) is asking for government’s help to put an end to unfair trade practices of the ecommerce companies. The direct sellers body is asking the government to regulate the ecommerce players from selling products of direct selling companies to protect the interest of the industry, which has seen a 16% compound annual growth rate (CAGR) since 2015-16.
IDSA highlighted the deep discounting offered by the ecommerce companies are affecting the direct selling business. The body accused ecommerce players of indulging in illegal and unauthorised sales of direct selling of products.
Uber Money To Be Launched In India By 2020!
Earlier this week, Uber announced its entry into fintech services called Uber Money. Uber claimed that the drivers will be benefited from this, as the company has introduced an instatnt-pay option, where the drivers can review their earnings after each ride and can redeem it according to the need.
The company is rolling out globally a debit card and account with Green Dot. It said that Apple has also enabled cashback on this debit card, reports added that instant pay has already taken off in the US. However, the company said that it has also added that Instant Pay has already taken off in the US, with more than 70% of driver payments are made using instant pay.
OYO, MakeMyTrip Under CCI Radar
The hoteliers have launched a complaint against three big players in the hospitality sector — OYO, MakeMyTrip and Goibibo — for affecting their businesses, due to predatory projects, high commissions and non-uniform commissions The Competition Commission of India (CCI)-directed official to carry out a detailed investigation in the matter and submit a report to the commission within 150 days.
Rapido Now In Delhi
Rapido, a bike-rental startup has finally made its way to Delhi. The company will primarily be focusing in central and southern areas of Delhi. The Rapido said that it will be providing last-mile commutes, especially for people, who use the metro on a daily basis.
UPI Crosses 1 Bn Transactions in October
The NPCI said that UPI has recorded 1.15 Bn transactions worth INR 1,193, 600 Cr ($27 Bn), against 955.02 Mn transactions worth INR 1,61,456.56 Cr in September 2019.
WhatsApp Reveals Shocking News
WhatsApp revealed a piece of shocking information. The instant messaging app claimed that the Indian government has previously used the Isreali spyware to spy on a dozen users, which includes academics, lawyers, activities and journalists. Pegasus, a surveillance firm created by Israel’s private NSO Group, was involved in the scrutiny of data in India during the run-up to the 2019 general elections. Ravi Shankar Prasad, the Minister for Electronics and Information Technology (MeitY), in a tweet said that government of India is concerned about the breach of the privacy of citizens of India on the messaging platform WhatsApp.
Other Indian Startup News Stories of The Week
AI Platform To Solve Complex Engineering Problems
A team of researchers from IIT-Madras have developed algorithms that enable novel applications using artificial intelligence (AI), machine learning (ML) and deep learning models to solve engineering problems.
RBCDSAI Collaborates With Freshworks
The SaaS unIcorn Freshworks has partnered with Robert Bosch Centre for Data Science and Artificial Intelligence (RBCDSAI) in IIT-Madras to improve the predictive capability of its customers’ relationship management (CRM) software.
Global Tech Companies Eyes Indian Market
India is one of the most attractive markets for tech companies, and Indians on an average download 5 Bn mobile applications, out of the total of 29.6 Bn downloads around the word.
Commerce and industry minister Piyush Goyal said that there is no such thing as angel tax in the Indian market. At CII event in Delhi, he stated that the startups will never be harassed and that the government is taking steps to promote them.
Netflix Launches The All-new Youtube-only show
Netflix is launching the first episode of ‘The Brand New Show” on its YouTube channel on October 31, which will be hosted by Instagram influencer Kusha Kapila. The show is a combination of a talk show and sketch comedy, which will be aired fortnightly.
17 iOS Apps Removed From Apple Store Over Malware
Wandera, a cybersecurity firm recently reported about the infected apps with a clicker trojan malware. The apps were said to communicate with a known command and control (C&C) server to simulate user interactions to increase advertising revenue. All the 17 apps were published from different countries and were being developed by Gujarat-based AppAspect Technologies.
Child Pornography/Child Sexual Abuse Material Ban on Social Media
More than 71 videos of child pornography, rape and gang-rape among other offensive videos, were removed from social media, as stated by the home ministry’s annual report released last week. However, more than 10K complaints of online content pertaining to child pornography and child sexual abuse were filed till March 31, 2019.
Stay tuned for the next week’s edition of News Roundup: Indian Startup Stories Of The Week!