Weeks after Zomato acquired Uber’s food delivery business in India, its chief local rival is bulking up some ammunition of its own.
Swiggy, India’s largest food delivery startup, announced on Wednesday it has raised $113 million as part of its Series I financing round. Prosus Ventures, the biggest venture capital for food delivery startups, led the round.
Meituan Dianping and Wellington Management Company also participated. The new round values Swiggy at about $3.6 billion, only slightly above its $3.3 billion valuation from the previous round, a source familiar with the matter told TechCrunch. The startup has raised about $1.57 billion to date.
Sriharsha Majety, co-founder and chief executive of Swiggy, said the startup will use the fresh capital to invest in “new lines of business” such as cloud kitchens and delivery beyond food items, and get on a “sustainable path to profitability.”
Prosus Ventures, formerly known as Naspers Ventures and Food, first wrote a check to Swiggy three years ago. Since then, it has become its biggest investor — having pumped in more than $700 million alone in the startup’s $1 billion financing round in December 2018.
“Swiggy continues to exhibit strong execution and a steadfast commitment to delivering the best service to consumers and has one of the best operational teams in food delivery globally. We are confident Swiggy will continue on a path to earn a significant place in the daily lives of Indians,” said Larry Illg, chief executive of Prosus Ventures and Food, in a statement.
The Bangalore-headquartered firm, which is operational in 520 cities, said it has witnessed a 2.5x growth in the volume of transactions in the past year. Its restaurant partners base has also grown to 160,000 and more than 10,000 are joining the platform each month.
Some analysts say that it will be very challenging for Swiggy and Zomato, both of which are spending over $20 million a month to win customers, to reach profitability.
Unlike in the developed markets like the U.S., where the order value of each delivery is about $33, in India, a similar item carries the price tag of $4.
Anand Lunia, a VC at India Quotient, said in a recent podcast that the food delivery firms have little choice but to keep subsidizing the cost of food items on their platform as otherwise most of their customers can’t afford to get their lunch and dinner from them.
The exit of Uber from India’s food delivery space has, however, made the market a duopoly play, so investors remain bullish. At stake is a $4.2 billion opportunity, according to research firm Redseer. But Zomato, which raised $150 million earlier this year, and Swiggy have alone picked up more than $2.1 billion from the market already.
The internet has, for better or worse, become the default platform for people seeking information, and today one of the companies leveraging that to deliver educational content has raised some funding to fuel its next stage of growth. Udemy, which provides a marketplace offering some 150,000 different online learning courses from business analytics through to ukulele lessons, has picked up $50 million from a single investor, Benesse Holdings, the Japan-based educational publisher that has been Udemy’s partner in the country. The investment values Udemy at $2 billion post-money, it said.
This is a big jump since the startup last raised money, a $60 million round in 2016 that valued it at around $710 million (according to PitchBook data). With this round, Udemay has raised around $130 million in funding.
The plan will be to use the funding to expand all of Udemy’s business, which includes a vast array of courses for consumers that can be purchased a la carte — to date used by some 50 million students; as well as enterprise services, where Udemy works with companies like Adidas, General Mills, Toyota, Wipro, Pinterest and Lyft and others — 5,000 in all — to develop and administer subscription-based professional development courses. Udemy’s president Darren Shimkus describes this as a “Netflix-style” model, where users are presented with a dashboard listing a range of courses that they can take on demand.
Udemy will also be looking at improving how courses are delivered, as well as consider new areas it might move into more deeply to fit what Shimkus described as the biggest challenge for the company, and for the global workforce overall:
“The biggest challenge is for learners is to figure out what skills are emerging, what they can do to compete best in the global market,” he said. “We’re in a world that’s changing so quickly that skills that were valued just three or four years ago are no longer relevant. People are confused and don’t know what they should be learning.” That’s a challenge that also stands for businesses, he added, which are trying to work out what he described as their “three to five year human capital roadmap.”
The investment will also include a specific boost for Udemy’s international operations, starting with Japan but extending also to other markets where Udemy has seen strong growth, such as Brazil and India.
“We’ve worked closely with Benesse for several years, and this investment is a testament to the strength of our relationship and the opportunity ahead of us,” said Gregg Coccari, CEO of Udemy, in a statement. “Udemy is on a mission to improve lives through learning, and so is Benesse. 2020 will be a milestone year where we serve millions more students and enable thousands of businesses and governments to upskill their employees. This growth wouldn’t be possible without our expert instructors who partner with us every step of the way as we build this business.”
Benesse’s business spans instructional materials for children through to courses for adults both online and in in-person training centers — one of the better-known brands that it owns is Berlitz, which operates both virtual courses as well as a network of physical schools — and Udemy has been developing content alongside Benesse both in Japanese as well as English, Shimkus said, targeting both consumer and business markets.
“Access to the latest workplace skills is crucial for success everywhere, including Japan; and Udemy is the world’s largest marketplace enabling professional transformation. With this partnership, we envision a world where more people can continue to learn continuously throughout their lives,” said Tamotsu Adachi, Representative Director, President and CEO of Benesse Holdings Inc., in a statement. “Udemy and Benesse are incredibly synergistic businesses. This investment is the next progression in our business relationship and demonstrates our confidence in what we can accomplish together.”
Udemy’s expansion comes at a time when online education overall has generally continued to grow, although not without bumps.
Among those that compete at least in part with it, Coursera last year announced a $103 million round of funding at a $1 billion+ valuation and made its first acquisition to expand how it teaches programming and other computer science subjects. And in Asia, Byju’s in India is now valued at $8 billion after a quick succession of large growth rounds. We’ve also heard that Age of Learning, which quietly raised at a $1 billion valuation in 2016, is also gearing up for another round.
On the other hand, not all is rosy. Another big name in online learning, Udacity (not to be confused with Udemy), laid off 20% of its workforce amid a larger restructuring; and further afield, Kano — which merges online learning with DIY hardware kits — has also laid off and restructured in recent months. Meanwhile, we don’t seem to hear much these days from LinkedIn Learning, another would-be competitor that was rebranded Lynda.com after it was acquired by the social networking site (itself owned by Microsoft).
Unlike Coursera and others that aim for full degrees that are potentially aiming to disrupt higher education, Udemy focuses on short courses, either simply for the student’s own interest, or potentially for certifications from organizations that either help administer the courses or “own” the subject in question (for example, Cisco for networking certifications, or Microsoft regarding one of its software packages, or the PMI for a course related to project management).
Those courses are delivered by individuals who form the other half of Udemy’s two-sided marketplace. In the 10 years that it’s been in business, Udemy has worked with some 57,000 instructors to develop courses, and in the marketplace model, Shimkus told TechCrunch that those instructors have been netted $350 million in payments to date. (He would not disclose Udemy’s cut on those courses, nor whether the company is currently profitable.)
The company has a lot of areas that it has yet to tackle that present opportunities for how it might evolve. Working with enterprises but with a large base of consumer usage, there is, for example, a lot of scope to develop more data analytics about what is used, what is popular, and how to tailor courses in a better way to fit those models to improve outcomes and engagement. Another area potentially could see Udemy moving deeper into specific subject areas like language learning, where it offers some courses today but has a lot of scope for growing, particularly leaning on what Benesse has with Berlitz. To date, Udemy has made no acquisitions, but that is also an area that Shimkus said could be an option.
Local authorities in India-controlled Kashmir have opened a case against hundreds of people who used virtual private networks (VPNs) to circumvent a social media ban in the disputed Himalayan region in a move that has been denounced by human rights and privacy activists.
Tahir Ashraf, who heads the police cyber division in Srinagar, said on Tuesday that the authority had identified and was probing hundreds of suspected users who he alleged misused social media to promote “unlawful activities and secessionist ideology.”
On Monday, the police said they had also seized “a lot of incriminating material” under the Unlawful Activities Prevention Act (UAPA), the nation’s principal counter-terrorism law. Those found guilty could be jailed up to seven years.
“Taking a serious note of misuse of social media, there have been continuous reports of misuse of social media sites by the miscreants to propagate the secessionist ideology and to promote unlawful activities,” the region’s police said in a statement.
The move comes weeks after the Indian government restored access to several hundred websites, including some shopping websites such as Amazon India and Flipkart and select news outlets. Facebook, Twitter and other social media services remain blocked, and mobile data speeds remain capped at 2G speeds.
One analysis found that 126 of 301 websites that had been unblocked were only usable to “some degree.” To bypass the censorship on social media and access news websites, many in the disputed region, home to more than 7 million people, began using VPN services.
India banned internet access in Jammu and Kashmir in early August last year after New Delhi revoked Kashmir’s semi-autonomous status. The Indian government said the move was justified to maintain calm in the region — months later India’s apex court criticized the government for imposing a blanket internet ban for an indefinite period.
“The Government of India has almost total control over what information is coming out of the region,” said Avinash Kumar, executive director of human rights campaign group Amnesty International India.
“While the Government has a duty and responsibility to maintain law and order in the state, filing cases under counter-terrorism laws such as UAPA over vague and generic allegations and blocking social media sites – is not the solution. The Indian government needs to put humanity first and let the people of Kashmir speak,” he urged the government.
Mishi Choudhary, executive director of New Delhi-based Software Law and Freedom Centre, said that the authority did not need to chase people who are using VPNs, and should restore internet access like any other democratic society.
“Any alleged rumors can be addressed by putting out accurate and more information through the same social media platforms. Content-based restrictions on speech can only be allowed within the restrictions established by the Constitution and not in an ad hoc manner,” she said.
Video editing startup InVideo has new funding and a new product.
The San Francisco-headquartered company bills itself as the easiest way for anyone to create professional-quality videos, using a drag-and-drop interface along with a library of templates and stock photos and videos. The resulting videos can then be optimized for Facebook, Instagram, YouTube and other platforms.
InVideo’s new assistant does even more to help with the process. As demonstrated for me by co-founder and CEO Sanket Shah, as you create a video, it automatically makes suggestions for how the video could be improved — he compared it to Grammarly, but for video.
Shah said the assistant currently focuses on two areas, both text-related. First, it’s making sure that all the text on the screen is readable — so that, for example, you don’t have light-colored text on a light background. Second, it’s making sure the text is “comprehensible” — so that there’s not too much text on the screen, or it’s not flashing by too quickly.
“We all think that design is very creative, but there’s a lot of science in it as well,” he said.
Shah told me InVideo’s founders first worked together on a startup aiming to create 10-minute video summaries of nonfiction books. That’s when they discovered “video creation is a very painful process, it’s just not scalable.” So they launched the current startup hoping to solve this problem.
The company says it now has 100,000 customers — including AT&T, Sony Music, Reuters, CNN and CNBC — in 150 countries.
It might seem surprising for a large media company to need to use a tool like this, but Shah explained, “The users who use us [at those large companies] today are not video editors. If you want to constantly create videos about the U.S. elections, it’s not a video editor who’s doing it, it’s very likely a news producer” with limited or nonexistent editing experience.
Pricing for the editor starts at $10 per month, though there’s also a free version if you don’t mind watermarks.
InVideo is also announcing that it has raised an additional $2.5 million in funding from Sequoia Capital India’s Surge, along with angel investors Anand Chandrasekaran and Gokul Rajaram. It has now raised a total of $3.2 million.
“InVideo has truly captured the imagination of our users with their super user-friendly online video editor and great customer support,” said Ayman Al-Abdullah, CEO and president of software deals website AppSumo, in a statement. “In fact, it has gone on to become the most sold product in AppSumo history.”
Despite the rapid growth of e-commerce in India, Southeast Asia and other emerging markets, the vast majority of retail transactions there still happen offline in small stores that also serve as neighborhood hubs.
The central role these stores play in their communities led GGV Capital to develop what the firm refers to as its mom-and-pop shop investment thesis. This means backing startups that help small retailers digitize operations, tap into better supply chains and serve as delivery points in markets where logistics and online payment infrastructures are still developing. In turn, GGV’s managing partners believe this will lay the groundwork for stronger e-commerce growth.
Companies that GGV has already invested in under this thesis include B2B e-commerce platform Udaan and Telio, bookkeeping app KhataBook and social commerce startup Shihuituan (also called Nice Tuan) in China.
GGV managing partner Hans Tung says the mom-and-pop shop thesis means looking at consumers’ shopping habits across countries and understanding why they are different from a historical and social perspective. During his career, Tung has observed e-commerce develop in markets including the United States, China, Japan, Taiwan, India, Southeast Asia and Latin America. Offline shopping habits, population density, transportation infrastructure and credit card penetration all played a factor in how e-commerce evolved in each of those places.
“You realize e-commerce doesn’t exist in a vacuum. It exists as a substitute for what is happening in the offline world,” he says. “Mobile payment doesn’t happen in a vacuum. It just fulfills the same needs with a different method. It was a substitution for what was happening in the offline world with credit card and debit card penetration.”
Google said on Monday that it is winding down Google Station, a program that rolled out free Wi-Fi in more than 400 railway stations in India and “thousands” of other public places in several additional pockets of the world. The company worked with a number of partners on the program.
Caesar Sengupta, VP of Payments and Next Billion Users at Google, said the program, launched in 2015, helped millions of users surf the internet — a first for many — and not worry about the amount of data they consumed. But as mobile data prices got cheaper in many markets, including India, Google Station was no longer as necessary, he said. The company plans to discontinue the program this year.
Additionally, it had become difficult for Google to find a sustainable business model to scale the program, the company said, which in recent years expanded Station to Indonesia, Mexico, Thailand, Nigeria, Philippines, Brazil and Vietnam. The company launched the program in South Africa just three months ago.
Over the years, Google also explored ways to monetize the Google Station program. The company, for instance, began showing an ad when a user signed in to connect to its internet service.
In an interview early last year, Gulzar Azad, who spearheads connectivity efforts for Google in India, told me that the company was thinking about ways to scale Station to more markets, but noted that as far as deployment at Indian railway stations was concerned, Google had reached its goal (to serve 400 railway stations).
A year after Google announced its efforts to offer free Wi-Fi in India, the country’s richest man, Mukesh Ambani, launched his telecom network Reliance Jio. Jio offered customers the bulk of 4G data at no charge for an extended period of time, forcing other telecom operators to slash their tariffs.
The move ushered millions of Indians to the internet, access to which was too expensive for many, for the first time. In a separate interview, I asked Azad if Google Station’s relevance had somewhat diminished because of Reliance Jio’s entrance. At the time, he said plenty of people were still signing up for the company’s program and that they were continuing to show a great appetite to consume voluminous data.
Google works with a number of companies to enable free Wi-Fi for users in public places. In India, for instance, Google has built the software stack, while RailTel, a state-owned telecom infrastructure provider, delivers the free internet line.
RailTel delivers Wi-Fi in more than 5,600 railway stations, and over the years has developed the capability to offer its own software stack. “We are working with our partners to transition existing sites so they can remain useful resources for the community,” said Sengupta.
TechCrunch has reached out to a RailTel spokesperson to check whether the company plans to keep offering Wi-Fi in the 400 odd railway stations where it worked with Google. Update: RailTel will continue to service free Wi-Fi in all those railway stations. “We sincerely value the support we received from Google in this journey,” the spokesperson added.
“The challenge of varying technical requirements and infrastructure among our partners across countries has also made it difficult for Station to scale and be sustainable, especially for our partners. And when we evaluate where we can truly make an impact in the future, we see greater need and bigger opportunities in making building products and features tailored to work better for the next billion user markets,” said Sengupta.
Google isn’t the only tech giant that has worked to offer free internet to users in developing markets. Facebook’s successor to Internet.org — the program that was banned in India for violating net neutrality regulations — launched in the country in 2017.
Shares of Vodafone Idea fell by more than 23% on Friday after India’s apex court ordered the country’s second-largest telecom operator and Airtel, the third-largest telecom network, to arrange and pay billions of dollars in dues in a month.
In a strongly worded judgement, the Supreme Court rejected telecom networks’ application to defer paying historic $13 billion levies to the government. “This is pure contempt, 100% contempt,” Justice Arun Mishra told lawyers.
The order today, which may result in U.K. telecom giant Vodafone’s local joint venture’s collapse, saw Vodafone Idea’s shares plunge by 23.21%. Vodafone Idea had more than 336 million subscribers as of November last year, according to official figures (PDF).
The company did not respond to a request for comment.
The Supreme Court’s order was followed by direction from the Department of Telecoms to pay the dues by the end of Friday. The local ministry of telecommunications also ordered the telecom companies to keep their relevant offices open on Saturday to “facilitate” payments and answer queries.
In October, the Supreme Court ruled that Vodafone Idea and Bharti Airtel, as well as several other operators, including some that are no longer operational, will have to pay the government within 90 days a combined $13 billion in adjusted gross revenue as spectrum usage charges and license fees.
The Indian government and telecom operators have for a decade disputed how gross revenue should be calculated. The government has mandated the license and spectrum fee to be paid by operators as a share of their revenue. Telcos have argued that only core income accrued from use of spectrum should be considered for calculation of adjusted gross revenue.
Commenting on the ruling, Airtel said that it would pay $1.3 billion by next week and the remainder (about $5 billion) before March 17, when the Supreme Court hears the case again. Its shares rose 4.69% on Friday as the telecom operator is in a better position to pay and the prospects of it being only the second major telecom network to fight Reliance Jio, the top network run by India’s richest man Mukesh Ambani .
In recent months, executives of U.K.-headquartered Vodafone, which owns 45% of Vodafone Idea, have said that the group’s telecom business in India would “shut shop” if the government does not offer it any relief. Vodafone Idea, which is already saddled by $14 billion in net debt, owes about $4 billion in levies to the Indian government.
Vodafone Idea Chairman Kumar Mangalam Birla said in December that the firm is headed toward insolvency in the absence of a relief from the government. “It doesn’t make sense to put good money after bad,” he said then.
The last few years have been difficult for telecom operators in India, which arrived in the nation to secure a slice of the world’s second most populous market. But since 2016, they have lost tens of millions of subscribers after Ambani launched Reliance Jio and offered free data and voice calls for an extended period of time, forcing every other company to slash their tariffs.
Sidharth Luthra, a senior advocate at Supreme Court, said in a televised interview that the court is within its rights to reach such a decision, but said that perhaps they should have considered the economic consequences of the ruling that would impact jobs, and could disrupt the everyday lives of people who rely on a network’s services.
Vodafone Idea is the top trending topic on Twitter as of early Saturday (local time), as numerous people expressed concerns about the future prospects of the telecom network and worried if the service would remain operational for them.
The growing market of fantasy sports in India may soon have a new and odd entrant: ShareChat .
The local social networking app, which in August last year raised $100 million in a financing round led by Twitter, has developed a fantasy sports app and has been quietly testing it for six months, two sources familiar with the matter told TechCrunch.
ShareChat’s fantasy sports app, called Jeet11, allows betting on cricket and football matches and has already amassed more than 120,000 registered users, the sources said. The app, or its website, does not disclose its association with ShareChat.
A ShareChat spokesperson confirmed the existence of the app and said the startup was testing the product.
Jeet11 is not available for download on the Google Play Store due to the Android maker’s guidelines on betting apps, so ShareChat has been distributing it through Xiaomi’s GetApps app store and the Jeet11 website, and has been promoting it on Instagram. It is also available as a web app.
Fantasy sports, a quite popular business in many markets, has gained some traction in India in recent years. Dream11, backed by gaming giant Tencent, claimed to have more than 65 million users early last year. It has raised about $100 million to date and is already valued north of $1 billion.
Bangalore-based MPL, which counts Sequoia Capital India as an investor and has raised more than $40 million, appointed Virat Kohli, the captain of the Indian cricket team, as its brand ambassador last year.
In the last two years, scores of startups have emerged to grab a slice of the market, and the vast majority of them are focused on cricket. Cricket is the most popular sport in India, just ask Disney’s Hotstar, which claimed to have more than 100 million daily active users during the cricket season last year.
Or ask Facebook, which unsuccessfully bid $600 million to secure streaming rights of the IPL cricket tournament. It has since grabbed rights to some cricket content and appointed the Hotstar chief as its India head.
So it comes as no surprise that many sports betting apps have signed cricketers as their brand ambassador. Hala-Play has roped in Hardik Pandya and Krunal Pandya, while Chennai-based Fantain Sports has appointed Suresh Raina.
But despite the growing popularity of fantasy sports apps, where users pick players and bet real money on their performances, the niche is still sketchy in many markets that consider it betting. In fact, Twitter itself restricts promotion of fantasy sports services in many markets across the world.
In India, too, several states, including Assam, Arunachal Pradesh, Odisha, Sikkim and Telangana, have banned fantasy sports betting. Jeet11 currently requires users to confirm that they don’t live in any of the restricted states before signing up for the service.
“It doesn’t help matters either that the fantasy sports business’ attempts at legitimacy involve trying to be seen as video games — a cursory glance at a speakers panel for any Indian video game developer event is evidence of this — rather than riding on its own merits,” said Rishi Alwani, a long-time analyst of Indian gaming market and publisher of news outlet the Mako Reactor.
An executive who works at one of the top fantasy sports startups in India, speaking on the condition of anonymity, said that despite handing out cash rewards to thousands of users each day, it is still challenging to retain customers after the conclusion of any popular cricket tournament. “And that’s after you have somehow convinced them to visit your website or download the app,” he said.
For ShareChat, which has been exploring ways to monetize its 60 million-plus users and posted a loss of about $58 million on no revenue in the financial year ending March 31, that’s anything but music to the ears. In recent months, the startup, which serves users in more than a dozen local languages, has been experimenting with ads.
Doubtnut, a Gurgaon-based startup that operates an app to help students learn and master concepts from math and science using short videos, has raised $15 million in a new financing round as it looks to serve more people in small cities and towns of the country.
The financing round, Series A, was led by Chinese giant Tencent. Existing investors Omidyar Network India, AET, Japan and Ankit Nagori (founder of fitness startup Cure.Fit), and Sequoia Capital India also participated in the round, the two-year-old startup said.
The app allows students from sixth grade to high-school solve and understand math and science problems in local languages. Doubtnut app allows them to take a picture of the problem, and uses machine learning and image recognition to deliver their answers through short-videos.
A student can take a picture of the problem, and share it with Doubtnut through its app, website, or WhatsApp and get a short video that shows the answer and walks them through the procedure to tackle it.
Doubtnut said it has amassed over 13 million monthly active users across its website, app, YouTube, and WhatsApp . More than 85% of Doubtnut users today come from outside of the top 10 cities in India, said Tanushree Nagori, co-founder of Doubtnut. She said that more than half of these students have come online in the last one year.
“Doubtnut is truly democratizing education across India. Our user base reflects the entire demography of India, something which no other education app in the country has come close to achieving,” she said.
The growth of Doubtnut represents the emergence of a wave of startups in India that are tackling local challenges. In the education space alone, a number of players including Byju’s, which is now valued at $8 billion, Unacademy, Vedanutu, and GradeUp have shown impressive growth.
Gaurav Munjal, founder and chief executive of Unacademy, said on Saturday that his startup’s one-year-old premium offering had clocked $30 million in revenue.
Increasingly, the streets of Karachi and Lahore are being flooded with men riding bikes and wearing green T-shirts, a writer friend recently told me. In a sense, these men represent the emergence of Pakistan’s tech startups.
India now has more than 25,000 startups and raised a record $14.5 billion last year, according to government figures. But not all Asian countries are as large as India or have such a thriving startup ecosystem. Long overdue, things are beginning to change in bordering Pakistan.
Bykea, a three-year-old ride-hailing and delivery service, today has more than 500,000 bikes registered on its platform. It operates in some of Pakistan’s most populated cities, such as Karachi, Lahore and Islamabad, Muneeb Maayr, Bykea founder and CEO, told TechCrunch.
Maayr is one of the most recognized startup founders in Pakistan, and previously worked for Rocket Internet, helping the giant run fashion e-commerce platform Daraz in the country. While leading Daraz, he expanded the platform to cater to categories beyond fashion; Daraz was later sold to Alibaba.
A popular sexting website has exposed thousands of photo IDs belonging to models and sex workers who earn commissions from the site.
SextPanther, an Arizona-based adult site, stored more than 11,000 identity documents on an exposed Amazon Web Services (AWS) storage bucket, including passports, driver’s licenses and Social Security numbers, without a password. The company says on its website that it uses these documents to verify the ages of models with whom users communicate.
Most of the exposed identity documents contain personal information, such as names, home addresses, dates of birth, biometrics and their photos.
Although most of the data came from models in the U.S., some of the documents were supplied by workers in Canada, India and the United Kingdom.
The site allows models and sex workers to earn money by exchanging with paying users text messages, photos and videos, including explicit and nude content. The exposed storage bucket also contained more than 100,000 photos and videos sent and received by the workers.
It was not immediately clear who owned the storage bucket. TechCrunch asked U.K.-based penetration testing company Fidus Information Security, which has experience in discovering and identifying exposed data, to help.
Researchers at Fidus quickly found evidence suggesting the exposed data could belong to SextPanther.
An hour after we alerted the site’s owner, Alexander Guizzetti, to the exposed data, the storage bucket was pulled offline.
“We have passed this on to our security and legal teams to investigate further. We take accusations like this very seriously,” Guizzetti said in an email, who did not explicitly confirm the bucket belonged to his company.
Using information from identity documents matched against public records, we contacted several models whose information was exposed by the security lapse.
“I’m sure I sent it to them,” said one model, referring to her driver’s license, which was exposed. (We agreed to withhold her name given the sensitivity of the data.) We passed along a photo of her license found in the exposed bucket. She confirmed it was her license, but said that the information on her license is no longer current.
“I truly feel awful for others whom have signed up with their legit information,” she said.
The security lapse comes a week after researchers found a similar cache of highly sensitive personal information of sex workers on adult webcam streaming site, PussyCash.
More than 850,000 documents were insecurely stored in another unprotected storage bucket.
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Founder Andreas Kröpfl has spent almost a decade hard-grafting in the b2b unified communications space, building a videoconferencing business with a patented single-stream system and a claim of no ‘drop-offs’ thanks to “unique low-bandwidth technology”.
His Austria-based startup’s current web-based videoconferencing system, eyeson (née Visocon), which launched in 2018, has had some nice traction since launch, as he tells it, garnering a few million customers and getting a nomination nod as a Gartner Cool Vendor last year.
Eyeson’s website touts ‘no hassle, no, lag, no downloads’ video calls. Pricing options for the target b2b users run the gamut from freelance pro to full-blown enterprise. While the business itself has pulled in a smidge less than $7M in investor funding over the years.
But when TechCrunch came across Kröpfl last December, pitching hard in startup alley at Disrupt Berlin, he was most keen to talk about something else entirely: Video dating.
That’s because last summer the team decided to branch out by building their own video dating app, reusing their core streaming tech for a consumer-focused social experiment. And after a period of internal beta testing — which hopefully wasn’t too awkward within a small (up-til-then) b2b-focused team — they launched an experimental dating app in November in India.
The app, called Ahoi, is now generating 100,000 video calls and 250,000 swipes per day, says Kröpfl.
This is where he breaks into a giggle. The traction has been crazy, he says.
In the staid world of business videoconferencing you can imagine eyeson’s team eyeing the booming growth of certain consumer-focused video products rather enviously.
Per Kröpfl, they had certainly noticed different desires among their existing users — which pushed them to experiment. “We saw that private people like the simple fun features (GIF reactions, …) and that business meetings were more focused on ‘drop-off’ [rates] and business features,” he tells us. “To improve both in one product was not working any more. So eyeson goes business plus SaaS.”
“Cloning eyeson but make it social,” is how he sums up the experiment.
Ahoi is very evidently an MVP at this stage. It also looks like a pretty brave and/or foolish (depending on your view) full-bore plunge into video dating, with nothing so sophisticated as a privacy screen to prevent any, er, unwanted blushes… (Whereas safety screening is an element we’ve recently seen elsewhere in the category — see: Blindlee.)
There’s also seemingly no way for users to specify the gender they wish to talk to.
Instead, Ahoi users state interests by selecting emoji stickers — such as a car, cat, tennis racket, games console or globetrotter. And, well, it goes without saying that even if you like cars a lot you’re unlikely to change your sexual orientation over the category.
There are no generic emoji that could be used to specify a sexual interest in men or women. But, er, there’s a horse…
Such limits may explain why Ahoi is generating so many early swipes — and rather fewer actual calls — in that the activity sums to (mostly) men looking for women to videochat with and being matched with, er, men.
And frustration, sexual or otherwise, probably isn’t the greatest service to try and sell.
Still, Kröpfl reckons they’ve landed on a winning formula that makes handy reuse of their core videoconferencing tech — letting them growth hack in a totally new category. Swipe right to video date.
“People are disappointed by perfect profiles on Tinder and the reality when meeting people,” he posits. “Wasted time. Especially women do not want to be stalked by men pretending to be someone else. We solve both by a real live conversation where only after a call both can decide to be connected or never see each other again.”
Notably, marketing around the app does talk rather fuzzily about it being a way to “find new pals”.
So while Kröpfl frames the experiment as dating, the reality of the product is more ‘open to options’. Think of it as a bit like Chatroulette — just with slightly more control (in that you have a few seconds to decide if you don’t want to talk to the next in-app match).
The very short countdown timer (you get just five seconds to opt out of a matched video chat) is very likely generating a fair number of unintended calls. Though such high velocity matching might appeal to a certain kind of speed dating addict.
Kröpfl says Ahoi has been seeing up to 20,000 new users added daily. They’re bullishly targeting 3M+ users this year, and already toying with ideas for turning video dates into a money spinner by offering stuff like premium subscriptions and/or video ads. He says the plan is to turn Ahoi into a business “step by step”.
“Everyone loves to make his profile better,” he suggests, floating monetization options down the line. Quality filtering for a fee is another possibility (“everyone is annoyed by being connected to the wrong people”).
They picked India for the test launch because it has a lot of people on the same timezone, a large active mobile user-base and cheap marketing is still “easily possible”. He also says that dating apps seemed popular there, in their experience. (Albeit, the team presumably didn’t have a great deal of relevant experience in this category — given Ahoi is an experiment.)
The intent is also to open Ahoi up to other markets in time too, once they get more accustomed to dealing with all the traffic. Kröpfl notes they had to briefly take the app off the store last month, as they worked on adding more server capability.
“It is very early and we were not prepared for this usage,” he says, admitting they’ve been “struggling to work on early feedbacks”. “We had to make it invisible temporarily — to improve server capacity and stability.”
The contrast in pace of uptake between the stolid (but revenue-generating) world of business meeting-fuelled videoconferencing and catnip consumer dating — which is money-sucking unless or until you can hit a critical mass of usage and get the chance to try applying monetization strategies — does sound like it’s been rather irresistible to Kröpfl.
Asked what it feels like to go from one category to the other he says “crazy, surprised and thrilling”, adding: “It is somehow also frustrating when all the intense b2b work is not as closely interesting to people as Ahoi is. But amazing that it is possible thanks to an extremely focused and experienced team. I love it.”
TechCrunch’s Manish Singh agreed to brave the local video dating app waters in India to check Ahoi out for us.
He reported back not having seen any women using the app. Which we imagine might be a problem for Ahoi’s longer term prospects — at least in that market.
“I spoke with one guy, who said his friend told him about the app. He said he joined to talk to girls but so far, he is only getting matched with boys,” said Singh. “I saw several names appear on the app, but all of them were boys, too.”
He told us he was left wondering “why people are on these apps, and why they have so much free time on a weekday”.
For ‘people’ it seems safe to conclude that most of Ahoi’s early adopters are men. As the Wall Street Journal reported back in 2018, India’s women are famously cool on dating apps — in that they’re mostly not on them. (We asked Kröpfl about Ahoi’s gender breakdown but he didn’t immediately get back to us on that. Update: We’re told the app’s male to female ratio is 85:15. “India is challenging,” Kröpfl admits.)
That market quirk means those female users who are on dating apps tend to get bombarded with messages from all the lonely heart guys with not much to swipe. Which, in turn, could make a video dating app like Ahoi an unattractive prospect to female users — if there’s any risk at all of being inundated with video chats.
And even if there are enough in-app controls to prevent unwelcome inundation by default, women also might not feel like they want their profile to be seen by scores of men simply by merit of being signed up to an app — as seems inevitable if the gender balance is so skewed.
Add to that, if the local perception among single women is that men on dating apps are generally a turn-off — because they’re too eager/forward — then jumping into any unmoderated video chat is probably not the kind of safe space these women are looking for.
No matter, Kröpfl and his team are clearly having far too much fun growth hacking in an unfamiliar, high velocity consumer category to sweat the detail.
What’s driving Ahoi’s growth right now? “Performance marketing mainly,” he says, pointing also to “viral engagement by sharing and liking profiles”.
Notably, there are a lot of reviews of Ahoi on Google Play already — an unusual amount for such an early app. Many of them appear to be five star write-ups from accounts with European-sounding names and a sometimes robotic grasp of language.
“Eventhough Ahoi has been developed recently, it had high quality for user about calling, making friends and widing your knowlegde [sic],” writes one reviewer with atrocious spelling whose account is attached to the name ‘Dustin Stephens.’
“Talking with like minded people and same favor will creat a fun and interesting atmosphere. Ahoi will manage for you to call like condition above,” says another apparently happy but not entirely clear user, going by the name ‘Elisa Herring’.
There’s also a ‘Madeleine Mcghin’, whose profile uses a photo of the similarly named child who infamously disappeared during a holiday in Portugal in 2007. “My experience with this app was awesome,” this individual writes. “It gives me the option to find new people in every country.”
Another less instantly tasteless five-star reviewer, ‘Stefania Lucchini’, leaves a more surreal form of praise. “A good app and it will bring you extra income, I would say it’s a great opportunity to have AHOI and be a part of it but it’s that it will automatically ban you even if you don’t show it. Marketing. body part, there are still 5 stars for me,” she (or, well, ‘it’) writes.
Among the plethora of dubious five-star reviews a couple of one-star dunks stand out — not least because they come from accounts with names that sound like they might actually come from India. “Waste u r time,” says one of these, who uses the name Prajal Pradhan.
This pithy drop-kick has been given a full 72 thumbs-up by other Play Store users.
The Indian Space Research Organisation (ISRO) is getting ready to begin its human spaceflight program, which aims to carry its first astronauts starting in 2022. In advance of that milestone, however, the agency will be launching its “Gaganyaan” crewed orbital spacecraft later this year (if all goes to plan) — and while it won’t carry any human passengers, it will have one robotic crew member on board.
“Vyommitra” (via Times of India) is the name ISRO has given to its “half-humanoid” robotic astronaut, which will be on board the Gaganyaan when it takes its first flight in December. The robot has a range of functions and features, including being able to operate switch panels to control the capsule, and it can operate as a “companion,” with the ability to “converse with the astronauts, recognize them and respond to their queries,” as the robot put it in its own words at an unveiling this week.
Vyommitra is bilingual, and its semi-anthropomorphic nature will mean it can provide valuable data from this first uncrewed flight about how Gaganyaan would perform were a person actually strapped in and at the controls. The robot can also apparently perform “all” crew functions, including controlling environmental and life support systems, and it’s designed to have an expressive face and lip-sync capabilities for relaying info via voice, including messages from ground control.
This isn’t the first robot with human-like design or capabilities to make its way to space: Russia’s Skybot has made its way to the ISS, and NASA is testing spheroid robots called “Astrobee” that are designed to support astronauts and act as assistants. Each of these favors a different approach, however, and Vyommitra is an interesting take because of the clear effort put in to have it resemble a human in form as well as function.
TikTok, the fast-growing user-generated video app from China’s Bytedance, has been building a new music streaming service to compete against the likes of Spotify, Apple Music and Amazon Music. And today it’s announcing a deal that helps pave the way for a global launch of it. It has inked a licensing deal with Merlin, the global agency that represents tens of thousands of independent music labels and hundreds of thousands of artists, for music from those labels to be used legally on the TikTok platform anywhere that the app is available.
The news is significant because this is the first major music licensing deal signed by TikTok as part of its wider efforts in the music industry. That includes both its mainstay short-form videos — where music plays a key role (the app, before it was acquired by Bytedance, was even called ‘Musically’) — as well as new music streaming services.
Specifically, a source close to TikTok has confirmed to TechCrunch that this Merlin deal covers its upcoming music subscription service Resso.
Resso was long rumoured and eventually spotted in the wild at the end of last year when Bytedance tested the app in India and Indonesia. Bytedance owns the Resso trademark, so it’s a good bet that it will make its way to more markets soon. (Possibly with features that differentiate this later entrant from others in the market? Recall Bytedance acquired an AI-based music startup called Jukedeck last year.)
“Independent artists and labels are such a crucial part of music creation and consumption on TikTok,” said Ole Obermann, global head of music for Bytedance and TikTok, in a statement. “We’re excited to partner with Merlin to bring their family of labels to the TikTok community. The breadth and diversity of the catalogue presents our users with an even larger canvas from which to create, while giving independent artists the opportunity to connect with TikTok’s diverse community.”
Music is a fundamental part of the TikTok experience, and this deal covers everything that’s there today — videos created by TikTok users, sponsored videos created for marketing — as well as whatever is coming up around the corner.
A music streaming app, which TikTok has reportedly been gearing up to launch for some time, is one way that the company could help generate revenue. Despite being one of the most popular apps of 2019, monetisation has largely eluded the company up to now.
One reason why monetising can’t happen is because of the lack of deals at the other end of the chain. As of December, TikTok had yet to sign any deals with the “majors” — Sony Music, Warner Music and Universal Music — and from what we understand Merlin is the first big deal of its kind of the company. However, there are signs that more such agreements may be coming soon. Obermann, who was hired away from Warner Music last year, in turn hired another former Warner colleague, Tracy Gardner, who now leads label licensing for the company. And just yesterday, the company opened an office in Los Angeles, the heart of the music industry.
The move to bring more licensed music usage to TikTok (and other Bytedance apps) is significant for other reasons, too.
On one hand, it’s about labels trying to evolve with the times, collecting revenues wherever audiences happen to be, whether that is in short-form user-generated video, in advertising that runs alongside that, or in a new music service capitalising on the new vogue for streamed media.
“This partnership with TikTok is very significant for us,” said Jeremy Sirota, CEO, Merlin, in a statement. “We are seeing a new generation of music services and a new era of music-related consumption, much of it driven by the global demand for independent music. Merlin members are increasingly using TikTok for their marketing campaigns, and today’s partnership ensures that they and their artists can also build new and incremental revenue streams.”
One the other hand, the deal is significant also because it underscores how TikTok is increasingly working to legitimise itself in the wider tech and media marketplace.
While Bytedance’s acquisition of TikTok continues to face regulatory scrutiny, the company has been working on ways to assert its independence from China’s control, which has included many clarifications about where its content is hosted (not China! it says) and even a search for a new US-based CEO. On another front, more licensing deals should also help the company with the many legal and PR issues that have been hanging over it concerning how it pays out when music is used in its popular app.
Internet services company Opera has come under a short-sell assault based on allegations of predatory lending practices by its fintech products in Africa.
Hindenburg Research issued a report claiming (among other things) that Opera’s finance products in Nigeria and Kenya have run afoul of prudent consumer practices and Google Play Store rules for lending apps.
Hindenburg — which is based in NYC and managed by financial analyst Nate Anderson — went on to suggest Opera’s U.S. listed stock was grossly overvalued.
That’s a primer on the key info, though there are several additional shades of the who, why, and where of this story to break down, before getting to what Opera and Hindenburg had to say.
A good start is Opera’s ownership and scope. Founded in Norway, the company is an internet services provider, largely centered around its Opera browser.
Two years later, Opera went public in an IPO on NASDAQ, where its shares currently trade.
Though Opera’s web platform isn’t widely used in the U.S. — where it has less than 1% of the browser market — it has been number-one in Africa, and more recently a distant second to Chrome, according to StatCounter.
On the back of its browser popularity, Opera went on an African venture-spree in 2019, introducing a suite of products and startup verticals in Nigeria and Kenya, with intent to scale more broadly across the continent.
In Nigeria these include motorcycle ride-hail service ORide and delivery app OFood.
Central to these services are Opera’s fintech apps: OPay in Nigeria and OKash and Opesa in Kenya — which offer payment and lending options.
Fintech focused VC and startups have been at the center of a decade long tech-boom in several core economies in Africa, namely Kenya and Nigeria.
In 2019 Opera led a wave of Chinese VC in African fintech, including $170 million in two rounds to its OPay payments service in Nigeria.
Opera’s fintech products in Africa (as well as Opera’s Cashbean in India) are at the core of Hindenburg Research’s brief and short-sell position.
The crux of the Hindenburg report is that due to the declining market-share of its browser business, Opera has pivoted to products generating revenue from predatory short-term loans in Africa and India at interest rates of 365 to 876%, so Hindenburg claims.
The firm’s reporting goes on to claim Opera’s payment products in Nigeria and Kenya are afoul of Google rules.
“Opera’s short-term loan business appears to be…in violation of the Google Play Store’s policies on short-term and misleading lending apps…we think this entire line of business is at risk of…being severely curtailed when Google notices and ultimately takes corrective action,” the report says.
Based on this, Hindenburg suggested Opera’s stock should trade at around $2.50, around a 70% discount to Opera’s $9 share-price before the report was released on January 16.
Hindenburg also disclosed the firm would short Opera.
Founder Nate Anderson confirmed to TechCrunch Hindenburg continues to hold short positions in Opera’s stock — which means the firm could benefit financially from declines in Opera’s share value. The company’s stock dropped some 18% the day the report was published.
On motivations for the brief, “Technology has catalyzed numerous positive changes in Africa, but we do not think this is one of them,” he said.
“This report identified issues relating to one company, but what we think will soon become apparent is that in the absence of effective local regulation, predatory lending is becoming pervasive across Africa and Asia…proliferated via mobile apps,” Anderson added.
While the bulk of Hindenburg’s critique was centered on Opera, Anderson also took aim at Google.
“Google has become the primary facilitator of these predatory lending apps by virtue of Android’s dominance in these markets. Ultimately, our hope is that Google steps up and addresses the bigger issue here,” he said.
TechCrunch has an open inquiry into Google on the matter. In the meantime, Opera’s apps in Nigeria and Kenya are still available on GooglePlay, according to Opera and a cursory browse of the site.
For its part, Opera issued a rebuttal to Hindenburg and offered some input to TechCrunch through a spokesperson.
In a company statement opera said, “We have carefully reviewed the report published by the short seller and the accusations it put forward, and our conclusion is very clear: the report contains unsubstantiated statements, numerous errors, and misleading conclusions regarding our business and events related to Opera.”
Opera added it had proper banking licenses in Kenyan or Nigeria. “We believe we are in compliance with all local regulations,” said a spokesperson.
TechCrunch asked Hindenburg’s Nate Anderson if the firm had contacted local regulators related to its allegations. “We reached out to the Kenyan DCI three times before publication and have not heard back,” he said.
As it pertains to Africa’s startup scene, there’ll be several things to follow surrounding the Opera, Hindenburg affair.
The first is how it may impact Opera’s business moves in Africa. The company is engaged in competition with other startups across payments, ride-hail, and several other verticals in Nigeria and Kenya. Being accused of predatory lending, depending on where things go (or don’t) with the Hindenburg allegations, could put a dent in brand-equity.
There’s also the open question of if/how Google and regulators in Kenya and Nigeria could respond. Contrary to some perceptions, fintech regulation isn’t non-existent in both countries, neither are regulators totally ineffective.
Kenya passed a new data-privacy law in November and Nigeria recently established guidelines for mobile-money banking licenses in the country, after a lengthy Central Bank review of best digital finance practices.
Nigerian regulators demonstrated they are no pushovers with foreign entities, when they slapped a $3.9 billion fine on MTN over a regulatory breach in 2015 and threatened to eject the South African mobile-operator from the country.
As for short-sellers in African tech, they are a relatively new thing, largely because there are so few startups that have gone on to IPO.
In 2019, Citron Research head and activist short-seller Andrew Left — notable for shorting Lyft and Tesla — took short positions in African e-commerce company Jumia, after dropping a report accusing the company of securities fraud. Jumia’s share-price plummeted over 50% and has only recently begun to recover.
As of Wednesday, there were signs Opera may be shaking off Hindenburg’s report — at least in the market — as the company’s shares had rebounded to $7.35.
Good morning, friends, and welcome back to TechCrunch’s Equity Monday, a short-form audio hit to kickstart your week. Equity’s regular, long-form shows still land each and every Friday, including this entry from just a few days ago.
This morning, coming to you early from the frozen tundra of the American East Coast, it’s Tuesday. That’s because yesterday was a holiday in the United States, so we took the day to work a little bit less than usual. But that doesn’t mean we’d skip an episode, so let’s dive into topics:
And that was all the time that we had. We’re back Friday and Monday.
Uber said on Tuesday it has sold its food delivery business, Uber Eats, in India to local rival Zomato as the American ride-hailing giant races to shed loss-making operations to become profitable by next year.
As part of the deal, Uber would own 9.99% of Zomato and its Eats users would become part of the Indian company, the two loss-making firms said. The deal valued Uber Eats’ India business between $160 million and $200 million*, two people familiar with the matter told TechCrunch.
TechCrunch reported last month that the two were in advanced stages of talks for a deal. Indian newspaper Times of India first signaled about the two companies’ talks in November.
Satish Meena, an analyst at Forrester, told TechCrunch that despite the Uber deal, Zomato still lags local rival Swiggy, which services more orders each day. Backed by Prosus Ventures, Swiggy raised $1 billion in late 2018.
“Our Uber Eats team in India has achieved an incredible amount over the last two years, and I couldn’t be prouder of their ingenuity and dedication,” said Dara Khosrowshahi, chief executive of Uber, in a statement.
Uber Eats, which entered India in 2017, initiated conversations to sell the local business in late 2018, said people familiar with the matter.
“India remains an exceptionally important market to Uber and we will continue to invest in growing our local Rides business, which is already the clear category leader. We have been very impressed by Zomato’s ability to grow rapidly in a capital-efficient manner and we wish them continued success,” he added.
According to industry estimates, Uber is not the “clear category leader” in India. That title belongs to Ola, which processes twice as many rides as Uber in India and has presence in 110 cities, compared to the American firm’s roughly three-dozen.
As for Uber Eats employees in India, some of them have been given the option to join Uber while rest will be let go, people familiar with the matter told TechCrunch.
The announcement comes amidst news of Zomato’s new financing round. The 11-year-old Indian firm last month raised $150 million from Ant Financial and says it is looking to secure another $400 million in the next few weeks.
Offloading Uber Eats India would help Uber, which left Southeast Asia last year, reduce its global losses. The company, which cut hundreds of jobs last year, reported a quarterly loss of more than $1 billion in November. In the prior quarter, it lost about $5.2 billion. Uber says that it aims to become profitable by 2021.
The ride-hailing giant projected a loss of $107.5 million for its Uber Eats business in India for the period between August and December of last year. Zomato, too, has been reducing its burn rate. The company, which as of 2018 was losing more than $40 million each month, has cut its monthly loss to $20 million, Info Edge, one of the investors in Zomato, told analysts in an earnings call in November.
*Update: The story was updated to change the valuation of Uber Eats’ India business. An earlier version of the story pegged the deal to be worth $300 million to $350 million.
The Catalyst Fund has gained $15 million in new support from JP Morgan and UK Aid and will back 30 fintech startups in Africa, Asia, and Latin America over the next three years.
The Boston based accelerator provides mentorship and non-equity funding to early-stage tech ventures focused on driving financial inclusion in emerging and frontier markets.
That means connecting people who may not have access to basic financial services — like a bank account, credit or lending options — to those products.
Catalyst Fund will choose an annual cohort of 10 fintech startups in five designated countries: Kenya, Nigeria, South Africa, India and Mexico. Those selected will gain grant-funds and go through a six-month accelerator program. The details of that and how to apply are found here.
“We’re offering grants of up to $100,000 to early-stage companies, plus venture building support…and really…putting these companies on a path to product market fit,” Catalyst Fund Director Maelis Carraro told TechCrunch.
Program participants gain exposure to the fund’s investor networks and investor advisory committee, that include Accion and 500 Startups. With the $15 million Catalyst Fund will also make some additions to its network of global partners that support the accelerator program. Names will be forthcoming, but Carraro, was able to disclose that India’s Yes Bank and University of Cambridge are among them.
Catalyst fund has already accelerated 25 startups through its program. Companies, such as African payments venture ChipperCash and SokoWatch — an East African B2B e-commerce startup for informal retailers — have gone on to raise seven-figure rounds and expand to new markets.
Those are kinds of business moves Catalyst Fund aims to spur with its program. The accelerator was founded in 2016, backed by JP Morgan and the Bill & Melinda Gates Foundation.
Catalyst Fund is now supported and managed by Rockefeller Philanthropy Advisors and global tech consulting firm BFA.
African fintech startups have dominated the accelerator’s startups, comprising 56% of the portfolio into 2019.
That trend continued with Catalyst Fund’s most recent cohort, where five of six fintech ventures — Pesakit, Kwara, Cowrywise, Meerkat and Spoon — are African and one, agtech credit startup Farmart, operates in India.
The draw to Africa is because the continent demonstrates some of the greatest need for Catalyst Fund’s financial inclusion mission.
Roughly 66% of Sub-Saharan Africa’s 1 billion people don’t have a bank account, according to World Bank data.
Collectively, these numbers have led to the bulk of Africa’s VC funding going to thousands of fintech startups attempting to scale finance solutions on the continent.
Digital finance in Africa has also caught the attention of notable outside names. Twitter/Square CEO Jack Dorsey recently took an interest in Africa’s cryptocurrency potential and Wall Street giant Goldman Sachs has invested in fintech related startups on the continent.
This lends to the question of JP Morgan’s interests vis-a-vis Catalyst Fund and Africa’s financial sector.
For now, JP Morgan doesn’t have plans to invest directly in Africa startups and is taking a long-view in its support of the accelerator, according to Colleen Briggs — JP Morgan’s Head of Community Innovation
“We find financial health and financial inclusion is a…cornerstone for inclusive growth…For us if you care about a stable economy, you have to start with financial inclusion,” said Briggs, who also oversees the Catalyst Fund.
This take aligns with JP Morgan’s 2019 announcement of a $125 million, philanthropic, five-year global commitment to improve financial health in the U.S. and globally.
More recently, JP Morgan Chase posted some of the strongest financial results on Wall Street, with Q4 profits of $2.9 billion. It’ll be worth following if the company shifts any of its income-generating prowess to business and venture funding activities in Catalyst Fund markets like Nigeria, India and Mexico.
Venture Highway, a VC firm in India founded by former Google executive Samir Sood, said on Thursday it has raised $78.6 million for its second fund as it looks to double down on investing in early-stage startups.
The firm, founded in 2015, has invested in more than two dozen startups to date, including social network ShareChat, which last year raised $100 million in a financing round led by Twitter; social commerce Meesho, which has since grown to be backed by Facebook and Prosus Ventures; and Lightspeed-backed OkCredit, which provides a bookkeeping app for small merchants.
Moving forward, Venture Highway aims to lead pre-seed and seed financing rounds and cut checks between $1 million to $1.5 million on each investment (up from its earlier investment range of $100,000 to $1 million), said Sood in an interview with TechCrunch.
Venture Highway counts Neeraj Arora, former business head of WhatsApp who played an instrumental role in selling the messaging app to Facebook, as a founding “anchor of LPs” and advisor. Arora and Sood worked together at Google more than a decade ago and helped the Silicon Valley giant explore merger and acquisition deals in Asia and other regions.
Samir Sood, the founder of Venture Highway
The VC firm said it has already made a number of investments through its second fund. Some of those deals include investments in OkCredit, mobile esports platform MPL, Gurgaon-based supply chain SaaS platform O4S, social commerce startup WMall, online rental platform CityFurnish, community platform MyScoot and online gasoline delivery platform MyPetrolPump.
As apparent from the aforementioned names, Venture Highway focuses on investing in startups that are using technology to address problems that have not been previously tackled.
Last year Venture Highway also participated in a funding round of Marsplay, a New Delhi-based startup that operates a social app where influencers showcase beauty and apparel content to sell to consumers.
“It’s very rare to have investors who keep their calm, get into an entrepreneurial mindset and help founders achieve their dreams. Throughout the journey, Venture Highway has been extremely helpful, emotionally available (super important to founders) and very resourceful,” said Misbah Ashraf, 26-year-old co-founder and chief executive of Marsplay, in an interview with TechCrunch.
There is no “theme” or category that Venture Highway is particularly interested in, said Sood. “As long as there is a tech layer; and the startup is doing something where we or our network of LPs, advisors and investors can add value, we are open to discussions,” he said.
This is the first time Venture Highway has raised money from LPs. The firm’s first fund was bankrolled by Sood and Arora.
Dozens of local and international VC funds are today active in India, where startups raised a record $14.5 billion last year. But a significant number of them focus on late-stage deals.
India’s trade minister isn’t impressed with Amazon’s new $1 billion investment in the country.
A day after Amazon chief executive Jeff Bezos announced that his company is pumping in an additional $1 billion into its India operations, making the total local investment to date $6.5 billion, the nation’s trade minister Piyush Goyal said Amazon’s investment was not a big favor to the country.
“They may have put in a billion dollars, but then, if they make a loss of a billion dollars every year then they jolly well have to finance that billion dollars,” Goyal said in a conference on Thursday organized by think tank Observer Research Foundation. “So it’s not as if they are doing a great favor to India when they invest a billion dollars.”
The remark from the Indian minister comes days after the nation’s antitrust watchdog announced a probe into Amazon India and Walmart-owned Flipkart’s alleged predatory practices.
Bezos, who is in India this week, has sought to meet with India’s Prime Minister Narendra Modi, but his request has yet to be approved, a person familiar with the matter told TechCrunch.
Goyal reiterated that foreign e-commerce players would have to abide by the local law if they want to continue to operate in the nation. He said the watchdog’s allegations were “an area of concern for every Indian.”
“We allowed every entity to come to India in a marketplace model. A marketplace model is an agnostic model where buyers and sellers are free to trade. If they establish an agreement, then the transaction is between the buyer and seller. The marketplace cannot own the inventory, cannot have control over the inventory, cannot determine prices, and cannot have an algorithm that influences how products from different sellers are listed on the platform,” he added.
“We have several rules for marketplaces in India. As long as one follows them, they are free to operate in India,” he said. Some of the allegations that are being investigated in India surround the alleged violation of these very aforementioned guidelines.
Goyal’s comments may further escalate the tension between Amazon and the Indian government. Last year, U.S. senators criticized New Delhi after it restricted foreign companies from selling inventory from their own subsidiaries. The move forced Amazon and Flipkart to abruptly pull hundreds of thousands of goods from their marketplaces.