We bring to you the latest edition of News Roundup: Indian Startup Stories Of The Week!
In one of the important developments in the Indian startup ecosystem, an expert committee formed by the RBI to study the condition of MSME sector in India has said that the major reason for startups’ migration to foreign countries is their better business enabling environment, which includes tax concessions, ease of doing business and well-established infrastructure.
Further talks are underway that the India government may reportedly make it mandatory for internet majors such as Facebook, Uber and Amazon to put the non-personal data of their users on sale for anyone including government and private bodies.
Also, a group of about 50 fintech companies have reached out to the Ministry of Electronics and Information Technology (MeitY) seeking easy access to personal data which helps them in extending loans to consumers. The concerns arise as part of the Personal Data Protection (PDP) Bill, which is currently under the second round of consultations.
Here’s a look at the other important news stories from the Indian startup ecosystem.
Important Indian Startup News Stories Of The Week
Ola-Uber: The Highs And The Lows
Minister Nirmala Sitharaman recently blamed millennials’ preferences for Uber and Ola cabs as a cause for the double-digit fall of auto sales in India. The Central government is likely to introduce a cap on pricing during peak hours. Maruti Suzuki has also suffered job losses due to the slowdown. The company laid off over 3K employees recently. However, contrary to Sitharaman believes, Maruti do not blame Ola-Uber for the auto slowdown.
Meanwhile, Ola has started the pilot of its self-drive bookings in Bengaluru, while Uber has recently fixed a hacking bug found by Indian cybersecurity researcher Anand Prakash and paid him a bounty of $6,500. The bug allowed hackers to log into anyone’s Uber account.
Zomato: Hits The News ‘Overload’
Zomato is the most talked-about company this week in the Indian startup ecosystem. Foodtech unicorn Zomato decided not to get bogged down by the protests and controversies and be back with a bang. CEO and cofounder Deepinder Goyal claimed that the company is on the verge of cracking its maiden profit.
At first, it laid off 540 employees (around 10% of the workforce) from it’s Gurugram head office to reduce redundancy across customer, merchant and delivery partner support teams. Also, just before its NRAI meeting to discuss the grievances of restaurants listed on Zomato and similar platforms, the company has taken down Infinity Dining service from its app. The restaurants listed on the food aggregator had called out Zomato Gold and Infinity Dining services, which provided heavy discounts, for eating into their profits.
Festive Season Bets Begin For Amazon India
- In preparation of The Great Indian Festival, the festive sale of Amazon, the company is planning to set up physical kiosks stores in large offices and educational institutions to act as a pickup spot for delivered products.
- Amazon India is also venturing into digital advertising in India. It has been promoting its ‘Click-out’ campaign since June. Under this, the company is promoting external advertisers to place ads on its platform in India.
- Amazon is now enabling customer pickups in Mumbai. The company has partnered with Indian Railways to set up pickup kiosks in four railway stations across Mumbai. The initiative will be launched as a pilot in CSTM, Thane, Dadar and Kalyan.
Centre Plans Tax Benefits For Using QR-Based Digital Payments
The tax benefit can be claimed by consumers and merchants after sharing their PAN and GSTIN details, respectively. NPCI had also decided to store these PAN details, shared with consent, in an encrypted format. The proposal was discussed at the last NPCI’s steering meeting held in August.
What Indian Govt Organisations Are Up To?
- MeitY wants social networking sites to remove any “illegal” content within 24 hours and provide information regarding the origin of the messages or posts within 72 hours. The government is also planning to update the guidelines to define “unlawful content” to make them concrete.
- The Indian government’s controversial plan of linking social media accounts of citizens to Aadhaar cards has drawn much criticism from privacy activists and political analysts, but MeitY seems to be forging ahead regardless. The ministry has reportedly written to Unique Identification Authority of India (UIDAI) seeking the Aadhaar-governing body’s opinion on such a linking of social media accounts to the 12-digit Aadhaar number.
- SEBI is working on an online voting mobile app to increase the participation of retail investors in the matters of corporate governance. The designing of a common mobile app is said to be currently in progress.
- With the rising dependence on the mobile phone to access bank accounts and store personal data in India, the government has started acknowledging the security threats that arise if it is stolen or cloned. The department of telecommunications (DoT) is now launching a website to report mobile phone theft, so as to track stolen or cloned phones.
The Loss Raga: MTNL And Payments Banks
The Reserve Bank of India (RBI) is reportedly looking to offer new licenses to set up small finance banks. The decision would also allow payments banks to apply for licenses. The conversion to small finance banks may improve the fiscal challenges for the payment banks. The sector has seen a collective loss of INR 516.5 Cr in July 2017-18, according to the RBI’s Trend And Progress of Banking in India 2017-2018 report. The losses had doubled from 2016-2017’s INR 242.2 Cr.
In another development, Telecommunication service provider MTNL has reached out to the government with INR 800 Cr worth of claims after incurring losses for quite some time, just like its counterpart BSNL. MTNL has been demanding clearance of Department of Telecommunications’ (DOT) outstanding dues, which includes INR 400 Cr reimbursement of bonds that the company had raised on behalf of the government a few years ago. DOT has confirmed the news.
IPO Talks In The Startup Ecosystem
- Paytm is looking to go public in the next two years. However, at the same time, digital payments company Paytm’s parent One 97 Communications Ltd and its group companies have together widened its losses by 162% in the last financial year as well.
- WeWork is looking to expand its India presence with new properties in Pune and other smaller cities, its high-profile IPO plans have come up against resistance, from none other than lead investor SoftBank.
- Mumbai-based online furniture and home products marketplace Pepperfry is looking to go public in the next 12-18 months. The CFO has set up an IPO day, next month, a single day where the board is only going to talk about strategy as we go forward for an IPO
Lido Learning’s Founder Accused Of Stealing IP
Online education platform Lido Learning founder Sahil Sheth has been accused of allegedly stealing 1180 confidential files from another online education platform Zico Learning. Sheth was working with Zico Learning since 2018 and was also involved in the hiring of 30 employees. Further, the source also alleged that Zico Learning has received commitments of around INR 9 Cr funding from some investors.
Other Startup News Stories Of The Week
Karnataka Leads In App Economy Jobs
The app economy in India has created 1.67 Mn jobs in the country, according to US-based policy think-tank Progressive Policy Institute (PPI), which has released a report entitled ‘The App Economy in India’. The report forecasts that India will overtake the US as the world’s largest developer population centre by 2024.
MSME Sector Needs Out-Of-The-Box Thinking
India’s minister of micro, small and medium enterprises (MSMEs), Nitin Gadkari reportedly said that achieving the goal of generating INR 10 Lakh Cr turnover for MSME sector would require the creation of new channels of funding, making the sector investor-friendly, new technological innovations, reducing logistics cost to make homegrown products competitive, adequate skilling and market support.
New Age Technologies Creating High-Value Jobs In India
A report by jobs portal Shine.com noted that machine learning, artificial intelligence, blockchain, augmented/virtual reality and natural language processing are already creating millions of jobs in India. However, since these domains need people with a specific set of skills that Indian graduates lack, there is a dire need for graduates and professionals to upskill themselves by unlocking the potential of online learning platforms.
IIM Udaipur Launches A Course On Digital Enterprises
The Indian Institute of Management Udaipur (IIM-U) has launched a full-time one year masters in business administration (MBA) programme in Digital Enterprise Management (DEM). The MBA programme, a first of its kind, looks to train managers and leaders to work in the fast-changing and emerging digital business enterprises where conventional management concepts and leadership styles no longer apply.
Disney Turns On The Heat In OTT Market
- Just a few months after it acquired live-streaming platform Hotstar via 20th Century Fox, Disney has reportedly laid out an aggressive plan to push revenues for the streaming platform. Currently, subscriptions make up a mere 7-8% of the total revenue generated by Hotstar. Disney has set a target to increase subscription-based revenues to 50% of the total revenue for the streaming platform, formerly owned by Star India.
- In another development, US-based video streaming giant Netflix has announced a long-term partnership with Karan Johar’s online-focussed production company, Dharmatic Entertainment. Under this, the two will create a broad range of new fiction and non-fiction series and films exclusively for Netflix members.
- Over-the-top (OTT) video streaming platforms are gaining traction in Tier 2 and Tier 3 cities. Around 60% of current OTT users come from non-metro cities. The claims have been backed by RedSeer Consulting. The consulting company’s report suggests that the rural consumption of these OTT platforms such as ALTBalaji, Amazon Prime, is expected to grow by 80% by 2022.
Facebook Data Breach Hits India Again
Another data breach has hit Facebook in India. Period calendering app Maya has been accused of sharing women’s menstrual, emotional and sexual health data with the tech giant. The app, which was acquired by Sheroes earlier this year, was founded in 2012 and has a presence in over 20 countries.
In another development, addressing the Supreme Court, the Tamil Nadu government reportedly said that Facebook’s concerns on user privacy go against its own “primary business model” of commercialising user data through targetted ads. The state government was replying to the petition filed by social media giant Facebook seeking transfer of cases to the apex court. T
Drivezy, OYO Sign Strategic Partnership
Bengaluru-based vehicle sharing marketplace Drivezy has announced a strategic partnership with Gurugram-based hospitality unicorn OYO Hotels and Homes. As part of this, Drivezy looks to leverage OYO’s network of over 10,000 leased and franchised buildings across 300 cities and create on-site hubs to station its bikes and cars.
Xiaomi’s Mi Pay Registers 18 Mn Users
Xiaomi launched Mi Pay in February this year, with the aim to encash the UPI growth through its growing phone sales. The company claims to mediate transactions worth INR 200 Cr. It claims that 90% Mi user interface (MIUI) users have used it to transfer funds to friends and family.
Stay tuned for the next edition of News Roundup: Important news stories of the week!