Ola, the largest ride-hailing service in India, said today its two-wheeler service — Ola Bike — is now operational in 150 Indian cities and towns and it intends to grow this business by three times in the next year.
The eight-year-old SoftBank -backed firm said Ola Bike is enabling it to reach the “hinterlands of India,” and bring affordable and convenient on-demand transportation to millions of people. The two-wheeler business, which like the cabs business sees someone drive a passenger around, was launched in 2016 and has created livelihoods for close to 300,000 people in India.
The aggressive expansion of Ola Bike, which until last year was in mostly pilot stages in a handful of cities in India, represents India’s growing appetite for picking bikes over cabs and other transportation mediums as they can rush through busy traffic to get to work.
A ride with Ola Bike costs as little as Rs 5 (7 cents) per kilometre. Uber, Ola’s chief rival in India, also maintains a two-wheeler business in India, called Uber Moto. Uber Moto is available in fewer than a dozen cities in India. Both Ola and Uber also offer three-wheeler auto services in the country.
In recent years, a number of startups, including Bounce, Vogo and Yulu, have emerged in the nation and their two-wheeler rental services are being used by tens of thousands of people — if not more — each day.
In a recent interview with TechCrunch, Bounce executives said the startup was clocking about 80,000 rides each day in Bangalore. Bounce offers a mix of gasoline and electric bikes on its platform.
Ola itself has committed about $100 million in scooter rental startup Vogo. Uber earlier this year partnered with Yulu to conduct electric bike trials in Bangalore. In a statement to TechCrunch, an Uber spokesperson in India said earlier this month that the pilot was still operational, but declined to share more.
In a statement, Arun Srinivas, head of sales and marketing at Ola, said Ola aims to “impact over a million Bike-partners in the coming year.” He added, “Ola Bike has enabled citizens from the smallest of towns such as Chapra in Bihar to large metropolitan areas such as Gurgaon with access to quick, reliable and affordable mobility.”
Accion Venture Lab—the seed-stage investment arm of non-profit Accion—has raised $23 million for a new inclusive fintech startup fund.
The Accion Venture Lab Limited Partnership, as its called, will make seed-stage investments in inclusive fintech startups, defined as ventures that “that leverage technology to increase the reach, quality, and affordability of financial services for the under-served at scale,” per a company release.
The new fund was raised with capital contributions from a number of participants, including the Ford Foundation, Visa Inc. and Proparco—the development finance institution of the French government.
The additional $23 million brings Accion Venture Lab‘s total capital under management to $42 million.
The new LP fund will consider startups from any geography, as along as they meet specific criteria. Overall, Accion Venture Lab doesn’t have regional investment quotas, but does look to allocate roughly 25 to 30 percent of its funds to Africa, Accion Venture Lab Managing Director Tahira Dosani told TechCrunch on a call.
“We want to continue to focus on Latin-America, on Sub-Saharan Africa, on Southeast Asia as well as in the U.S. It really is about…where we see the need and the opportunity across the markets that we’re in,” she said.
In line with Accion’s mandate to boost financial inclusion globally, Accion Venture Lab already has a portfolio of 36 fintech startup investments across 5 continents—including 9 in the U.S., 8 in Latin America, and 8 in India.
“Our goal is to really be the that first institutional investor in the companies we invest in. That’s were we see the biggest capital gap. And it’s where we build capability and expertise,” Dosani said. In 2018, Accion Venture Lab successfully exited Indian fintech company Aye Finance, following exits in 2017 and 2016.
This year Accion Venture Lab supported a $6.5 million Series A investment in Lulalend, a South African startup that uses internal credit metrics to provide short-term loans to SMEs that are often unable to obtain working capital.
Accion’s new LP fund will follow past practice and make investments typically in the $500,000 range. It will start sourcing startups immediately through its investment leads around the world and already made its first seed financing to U.S. venture Joust—a fintech platform for gig economy workers.
Accion Venture Lab’s LP fund is the first time the organization has pooled third-party investment capital, according to a spokesperson.
On the appeal for those contributing, Dosani named Accion’s geographic reach and experience. “We think that’s our strength, because we’re able to invest in similar business models across different markets. And we’re able to bring that knowledge from one market to another,” she said.
The Ford Foundation contributed $2 million, according to an email from Christine Looney, Deputy Director, Mission Investments. Visa didn’t disclose its capital contribution, but told TechCrunch it will play a role in governance through its participation in a Limited Partners Advisory Committee for the new fund.
As a point of observation, Accion Venture Lab stands out as a fund for giving an equal pitch footing to fintech ventures across frontier, emerging, and developed markets from Lagos to London.
Accion’s new LP fund—along with the organization’s commitment to make nearly a third of its investments in Africa—means more capital to digital finance startups on the continent. By a number of estimates, Africa’s 1.2 billion people still represent the largest share of the world’s unbanked and underbanked population.
The company — with an Uber-like app that connects truckers and companies to delivery services — will use the funds to upgrade its platform and expand to 10 new countries beyond current operating markets of Nigeria, Togo, Ghana and Kenya.
Since its launch in Lagos, the startup has continued to grow its product offerings, VC backing and customer base. Kobo360 claims a fleet of more than 10,000 drivers and trucks operating on its app. Top clients include Honeywell, Olam, Unilever, Dangote and DHL.
Kobo360’s latest round is also notable for Goldman Sachs’ involvement. Goldman’s participation tracks a growing list of African venture investments made by the U.S. based finance firm.
The company — which has a robust Africa sales network — could raise up to 3 billion yuan (or $426 million).
STAR is the Shanghai Stock Exchange’s new Nasdaq-style board for tech stocks that also went live in July with some 25 companies going public.
Headquartered in Shenzhen — where African e-commerce unicorn Jumia also has a logistics supply-chain facility — Transsion is a top-seller of smartphones in Africa under its Tecno brand.
The company has a manufacturing facility in Ethiopia and recently expanded its presence in India.
Transsion plans to spend the bulk of its STAR Market raise (1.6 billion yuan or $227 million) on building more phone assembly hubs and around 430 million yuan ($62 million) on research and development, including a mobile phone R&D center in Shanghai, a company spokesperson said.
The government of Rwanda will soon issue national policy guidelines to eliminate gas motorcycles in its taxi sector in favor of e-motos, according to a preview of the plan by President Paul Kagame at a public-rally
The director general for the Rwanda Utilities Regulatory Authority, Patrick Nyirishema, confirmed Kagame’s comments were ahead of a national e-mobility plan in the works for the East African nation.
“The president’s announcement is exactly the policy direction we’re in…it’s about converting to electric motos…The policy is prepared, it’s yet to be passed…and is going through the approval process,” Nyirishema told TechCrunch on a call from Kigali.
Motorcycle taxis in Rwanda are a common mode of transit, with estimates of 20 to 30 thousand operating in the capital of Kigali.
Nyirishema explained that converting to e-motorcycles is part of a national strategy to move Rwanda’s entire mobility space to electric. The country will start with public transit operators, such as moto-taxis, and move to buses and automobiles.
Ampersand, a Kigali-based e-moto startup, has already begun to pilot EVs and charging systems in Rwanda and will work with the country’s government on the moto-taxi conversion.
In an ExtraCrunch feature, TechCrunch delved into tech talent accelerator Andela — one of the most recognized and well funded startups operating in Africa.
In a byte, Andela is Series D stage startup ― backed by $180 million in VC ― that trains and connects African software developers to global companies for a fee.
CEO Jeremy Johnson dished on the company’s strategy toward profitability and responded to some of the criticism it receives ― namely a claim the startup is creating a second brain-drain when software developers leave Andela and Africa, to take positions with global companies.
Today Andela has offices in New York and five African countries: Nigeria, Kenya, Rwanda, Uganda, and Egypt ― which largely align with the continent’s top tech VC markets.
Across this network the company recruits software developers, builds software engineers, and deploys teams of software engineers.
Johnson disclosed numbers on Andela’s expected new hires for the year, current developer staff, how many departures the company expects, and how many of those will likely leave their home countries―which actually amounts to a fairly small percentage.
TechCrunch checked in with Nigerian fintech company Interswitch for the latest on its anticipated dual-listing London and Lagos stock exchanges.
A Bloomberg News story (based on background sourcing) revived speculation the IPO could happen this year for the company — which provides much of Nigeria’s digital banking infrastructure and has expanded its operations presence and payments products across Africa and globally.
Reports that Interswitch could be one of the earliest big tech companies out of Africa to go public trace back to 2016, when CEO and founder Mitchell Elegbe told TechCrunch the company was considering a listing before the end of that year.
Last month, an Interswitch spokesperson would neither confirm or deny a pending IPO, per a TechCrunch inquiry. So, it’s still tough to say if or when the company could list. But there are still several reasons why the business (and its possible IPO) are worth keeping an eye on, which we detailed in the update story.
One could be an eventual increase in venture funding to African startups, that could come from Interswitch. Another could be an Interswitch IPO adding another benchmark for global investors to gauge Africa’s tech sector beyond Jumia — the e-commerce company that became the first big tech firm operating in Africa to launch on a major exchange, the NYSE in April.
More Africa-related stories @TechCrunch
African tech around the ‘net
As cities in emerging markets grapple with increasingly traffic-clogged and dangerous streets, Urbvan, a startup providing private, high-end transportation shuttles in Mexico, has raised $9 million in a new round of financing.
Hailing from Portugal, Albino arrived in Mexico City as a hire for the Rocket Internet startup Linio. Although Linio didn’t last, Albino stayed in Mexico, eventually landing a job working for the startup Mercadoni, which is where he met Picard.
The two men saw the initial success of Chariot as it launched from Y Combinator, but were also tracking companies like the Indian startup Shuttl.
“We wanted to make shared mobility more accessible and a little bit more efficient,” says Albino. “We studied the economics and we studied the market and we knew there was a huge urgency in the congested cities of Latin America.”
Unlike the U.S. — and especially major cities like San Francisco and New York — where public transportation is viewed as relatively safe and efficient, the urban environment of Mexico City is seen as not safe by the white-collar workers that comprise Urbvan’s principal clientele.
The company started operating back in 2016. At the time it had five vans that it leased and retrofitted to include amenities like Wi-Fi and plenty of space for a limited number of passengers. The company has expanded significantly since those early days. It now claims more than 15,000 monthly users and a fleet of 180 vans.
Urbvan optimized for safety as well as comfort, according to Albino. The company has deals with WeWork, Walmart and other retailers in Mexico City, so that all the stops on a route are protected and safe. The company also vets its drivers and provides them with additional training because of the expanded capacity of the vans.
Each van is also equipped with a panic button and cameras inside and out for additional monitoring.
Customers either pay $3 per ticket or sign up for a monthly pass that ranges from $100 to $130.
Financing for the company came from Kaszek Ventures and Angel Ventures, with previous investor Mountain Nazca also participating.
For Albino, who went to India to observe Shuttl’s operations, the global market for these kinds of services is so large that there will be many winners in each geography.
“Each city is different and you need to adapt. The technology needs to be adaptable to the city’s concerns, and where it can, add more value,” says Albino. “The Indian market is super different from Latin America… It’s a huge market with a lot of congestion… But the value proposition is a bit more basic [for Shuttl].”
Urbvan is currently operating in Mexico City and Monterrey, but has plans to expand into Guadalajara later this year.
Many Silicon Valley companies and fintech startups in India today share a common mission: They all want to bring their financial services to the next billion users. Dozens of fintech startups that we have spoken to in recent months have told us that they all want to address much of India, one of the last great growth markets globally, in the next few years.
So you can imagine our excitement when we learned there is at least one startup that is going after just a few million users in the immediate future. We’re talking about CRED, a nine-month-old, Bangalore-based startup that is building solutions to incentivize credit card users in India to become more responsible with money and thereby improve their credit score.
CRED has raised $120 million in a Series B financing round, Kunal Shah, founder and CEO of the startup, told TechCrunch on Monday. He declined to share more information. The startup, which has raised about $145 million to date, is now valued between $430 million to $450 million, a person familiar with the matter told TechCrunch.
According to a regulatory filing, existing investors Sequoia Capital, Ribbit Capital and DST Global’s Gemini Investments led the round, with participation from Tiger Global, Hillhouse Capital, General Catalyst, Greenoaks Capital and Dragoneer.
Hundreds of millions of Indians today don’t have a credit score because they have never taken a loan from a recognized entity nor owned a credit card. According to the government’s official figures, fewer than 50 million credit cards are in circulation in India currently, with industry reports suggesting that the actual number of unique credit card holders is about half of that.
“Nobody taught us about how to use money,” Shah told TechCrunch in a recent interview. “This has created a huge trust gap in India. If you look at developed markets, systematic trust is very high between all the entities. Members don’t have to rely on third-parties. In India, even if you wanted to rent a flat, you look for brokers, for instance.”
You can build that trust when you know how someone handles their money, and how they have handled it in recent history. “Our aim is to create a big membership community with high credit worthiness, therefore open up more opportunities for them,” Shah explained.
Shah is not going after the masses. He wants to focus on just the credit card users for now, and if he could win the trust of just half of those plastic card holders in India, he would consider it a success.
“Instead of chasing the mythological mass customers who are currently useful only on paper if you wanted to boast about your daily active user or monthly active user metric, our goal is to serve the existing users,” he said.
On CRED, users are offered a range of features, including the ability to better track their spending, get reminders and check their credit score, but more importantly, access to a range of lofty offers such as membership to a gym at a discounted price, access to good restaurants at low prices and subscription to various services at little to no charge. Users can access these features by earning points, which they can secure every time they pay their bills on time.
Varun Krishnan, editor of technology news site FoneArena, told TechCrunch that he has found CRED useful in getting reminders to pay his bills and likes that he can pay them through a range of payment options, including UPI apps and debit cards. “I have several cards and it is hard to track amounts and due dates of payment for each one. They send all these alerts on WhatsApp, which is a blessing,” he said.
These are the reasons that attracted many people like Krishnan to join CRED. That, and some incentive to pay his bills — though he hopes that CRED expands the range of offers it currently provides to customers.
That wish may soon come true. In the coming months, CRED will enable these highly sought-after customers to access some financial services from banks in a single-click. Additionally, it is also exploring expansion to some international markets, the aforementioned source said.
CRED does not charge users any money for joining its platform, nor for availing any of the features it offers. But it is generating revenue from some of the partners that are supplying offers on the app.
Generating revenue, however, is not the biggest focus for Shah currently. And he is one of the few people in the industry who can build a business with such conviction.
An industry veteran known for speaking the uncomfortable truth at conferences, it’s no surprise that Shah has won the trust of so many investors already. He built one of the biggest payment apps in India, Freecharge, and sold it to e-commerce giant Snapdeal for a whopping $400 million in one of the increasingly rare exits that India’s fintech market has seen to date.
FreshToHome, a Bangalore-based e-commerce startup that sells fresh vegetable, fish, chicken and other kinds of meat, has raised $20 million in a new financing round as it looks to expand its footprint in the nation.
The Series B round for the startup was led by Iron Pillar, with Joe Hirao, the founder of Japan’s ZIGExn also participating in it. The startup, which closed its $11 million Series A financing round three months ago, has raised $33 million to date.
FreshToHome sells “100 percent” pure and fresh vegetables and meat in Bangalore, Mumbai, and Pune — the latter two of which it recently entered. It says it does not add any preservative or other chemicals to prolong the lives of the produce. (Typical meat sold by a retail store is riddled with chemicals and could be months old.)
Unlike most other marketplaces, FreshToHome has built its own supply chain network, which gives it better control over quality and delivery of the food items. It uses trains and planes to move inventory, and has become one of the biggest clients of several local airlines.
The startup sources vegetables and fish directly from 1500 fishermen and farmers across 125 coasts in the nation. It uses an app to negotiate with farmers and fishermen.
It continues to expand its control over all aspects of its business. “Today a large part of our poultry comes from institutional farmers. Now we are going a step ahead and processing the chicken at the slaughtering level ourselves,” Shan Kadavil, CEO of FreshToHome, told TechCrunch in an interview.
FreshToHome is able to deliver the perishables on the same day and as soon as up to two hours, Kadavil said.
The startup also began operations in UAE recently and has opened physical stores in Bangalore and Chennai.
FreshToHome has amassed 650,000 customers — up from 400,000 in late May — in 10 cities in India and recently started to sell milk in Bangalore, another market segment that remains largely unstructured in the nation. Every day it receives 14,000 orders, and processes 20 tons of fresh food.
It recently crossed $30 million in annualized direct to consumer sales, which makes it the largest e-commerce platform serving this category. It is seeing 30% month-to-month growth, said Kadavil, who has previously managed tech support for Support, and India operations for gaming firm Zynga.
And that growth has helped the startup attract some attention. Several major players in the nation, including Amazon India that recently expanded to include perishable category and Flipkart, have held talks with FreshToHome to acquire some stake in the startup, a person familiar with the matter told TechCrunch.
And there is a big opportunity in the space. The cold-chain market of India is estimated to grow to $37 billion in next five years.
In addition to directly procuring its supplies from farmers and fishermen, FreshToHome also serves as a micro-VC, giving them access to some money upfront and resources to produce more from their farms. It also gives them an assurance that it will buy back their produce.
Kadavil founded FreshToHome with Mathew Joseph, a veteran in the industry who has dealt with fish export for more than 30 years. Joseph started India’s first e-commerce venture in fish and meat called SeaToHome in 2012.
FreshToHome will use the fresh capital to expand its network of contract farmers, and add 200 to 300 tons of additional produce each month.
In a prepared statement, Anand Prasanna, Managing Partner of Iron Pillar, for which it is the first investment in food-tech space, said, “FreshToHome’s brand proposition has been to provide 100% fresh food with 0% chemicals — not an easy thing to achieve in India at a large scale. By smartly using big data and machine learning, they have created a sustainable supply chain, which offers a fair price to consumers, fishermen and farmers, for their premium produce… We love companies that solve such hard issues in large market segments in India through unique tech enabled moats!”
BharatPe, a New Delhi-based firm that is enabling hundreds of thousands of merchants to start accepting digital payments for the first time, and is also giving them access to working capital, has raised $50 million as it looks to scale its business in the nation.
The Series B round for the one-year-old startup was led by San Francisco-headquartered VC firm Ribbit Capital and London-based Steadview Capital, both of which have previously invested in a number of financial services in India.
Existing investors Sequoia Capital, Beenext Capital and Insight Partners also participated in the round, pushing BharatPe’s all-time raise to $65 million. The new round valued the startup at $225 million, Ashneer Grover, co-founder and CEO of BharatPe, told TechCrunch in an interview.
Google and Amazon, both of which offer payment services in India, were also in advanced stages of talks to fund BharatPe’s Series B financing round, but the startup’s founding team was not keen on diluting their stakes, especially in the wake of BharatPe’s recent growth, a person familiar with the matter told TechCrunch.
BharatPe operates an eponymous service to help offline merchants accept digital payments. Even as India has already emerged as the second largest internet market, with more than 500 million users, much of the country remains offline. Among those outside of the reach of the internet are merchants running small businesses, such as roadside tea stalls.
To make these merchants comfortable in accepting digital payments, BharatPe relies on QR codes built as part of government-backed UPI payments infrastructure. “We get them to put up a QR code in their shops, and any customer that uses a UPI-powered payments app — which is now supported by nearly every payments app in India — can pay these shop owners digitally,” said Grover.
Through BharatPe, these merchants also get access to a simplified dashboard on their phones to track the customers who owe them money and get periodic reminders.
BharatPe has amassed more than 1.5 million merchants on its platform. It processes more than 21 million transactions a month, worth more than $83 million, Grover said.
BharatPe also allows merchants to secure short-term loans. New merchants can secure about $500 for a period of three months from BharatPe. As merchants spend more time on BharatPe, the firm increases the amount to about $2,000.
The lending business is crucial to BharatPe. Payment apps make little to no money through making transactions on their platforms. Those processing UPI payments can not even charge a small commission to merchants. “There is no money to be made in doing payments in India,” Grover said. So you charge small interest on loans.
Access to working capital is a major challenge in developed markets such as India. According to a World Bank report, more than 2 billion people globally do not have access to working capital.
Grover said BharatPe aims to use the fund to add about 3.5 million merchants in the next 12 months. The firm has more than 2,000 sales people who are adding 400,000 new merchants to BharatPe each month, he said.
The rest of the money will go into financing the loans on the platform and building new solutions. Later today, BharatPe will launch a new service to connect suppliers and merchants through BharatPe so that their accounts are in sync.
India today addressed a long-standing challenge that has been affecting the country’s booming startup ecosystem. As part of a raft of measures to boost overall economic growth from a five-year low, Finance Minister Nirmala Sitharaman said New Delhi is exempting startups from Section 56(2) — a provision more popularly known as an “angel tax” in the local income tax laws — that required startups to pay a certain tax if they received an investment at a rate higher than their “fair market valuation.”
Local tax authority in India does not recognize the discounted cash flow method that many investors use to value early-stage startups, and instead value the company for what it is worth currently, which as you can imagine, is very little. Investors assess a startup’s value based on what it could eventually become in the future.
Prior to today’s announcement, the government levied a 30% tax on affected startups. Sitharaman said any startup that is registered with the Department of Industrial Policy & Promotion, a government body, will be exempted from the angel tax. Those not registered will remain subjected to it, she said in a press conference Friday.
More than 24,000 startups are currently registered with the Department of Industrial Policy & Promotion. The law was originally introduced amid concerns that wealthy people could invest in bogus startups as a way to launder money.
“Angel tax was there to stop shell companies from creating capital from nowhere,” Piyush Goyal, a minister for commerce and industry as well as railways, said in a statement Friday.
The angel tax, which was introduced in 2012, impacted only the local investors, becoming a roadblock for many citizens from funding early-stage startups. The announcement today comes weeks after the Narendra Modi government said it would address this issue.
Many prominent investors, startup founders, analysts and other industry executives have long publicly criticized the angel tax, telling the government that it is severely hurting the health of the local ecosystem.
Anand Mahindra, chairman of Mahindra Group, said last year that the angel tax needs “immediate attention or else all chances of building a rival to Silicon Valley in India will be lost.”
Sreejith Moolayil, a founder of health food startup True Elements, said the existence of an angel tax would leave many entrepreneurs like him with no choice but to shut down their companies.
Late last year, India’s tax department sent a flurry of notices to startups demanding them to pay the angel tax on funds they received from individual investors. The notices sparked an uproar, with many calling it “harassment.”
“Hope this will address the concerns of DPIIT registered startups. The proposed cell should look into concerns of all startups including those who are already under notice,” said Ashish Aggarwal, who oversees Public Policy at industry body Nasscom, of today’s announcement.
The government will also set up a dedicated cell to address other tax problems that startups face, Sitharaman said. “A startup having any income-tax issue can approach the cell for quick resolution,” the ministry said in a statement.
Jayanth Kolla, founder and chief analyst at research firm Convergence Catalyst, told TechCrunch earlier that the angel tax was the primary reason early-stage startups in the nation were struggling to raise money from investors.
Even as Indian tech startups raised a record $10.5 billion in 2018, early-stage startups saw a decline in the number of deals they participated in and the amount of capital they received. Early-stage startups participated in 304 deals in 2018 and raised $916 million in funds last year, down from $988 million they raised from 380 rounds in 2017 and $1.096 billion they raised from 430 deals the year before, research firm Venture Intelligence told TechCrunch.
Sitharaman also announced the country was scrapping a recently introduced additional levy on foreign funds. The government would revoke the surcharge, which increased tax on foreign companies investing in India to over 40%, she said. She also promised to pay out all pending tax refunds owed to small and medium enterprises within 30 days. Companies have long complained that the tax authority takes too much time to refund the money owed to them.
Amazon, which has invested over $6 billion in India’s growing internet market, just invested a little more as it moves to expand its presence in the country’s brick and mortar space that drives much of the sales in the nation. The U.S. e-commerce giant is acquiring a 49% stake in Future Coupons, a group entity owned by India’s second largest retail chain Future Retail, the latter said in a regulatory filing Thursday evening (local time).
An Amazon spokesperson told TechCrunch the investment would “enhance Amazon’s existing portfolio of investments in the payments landscape in India.” The spokesperson added, “Amazon has agreed to invest in Future Coupons Limited, which is engaged in developing innovative value-added payment products and solutions such as corporate gift cards, loyalty cards, and reward cards primarily for corporate and institutional customers.”
Financial terms of the deal were not disclosed.
“Pursuant to these agreements, Amazon has agreed to make an equity investment in Future Coupons Limited for acquiring a 49% stake comprising both, voting and non-voting shares. As part of the agreement, Amazon has been granted a call option,” Future Retail said in a filing (PDF) to the local stock exchange.
As part of the agreement, Amazon has the option to “acquire all or part of the promoters’ shareholding in Future Retail Limited” between the third and tenth year in “certain circumstances, subject to applicable law.” Future Coupons owned about 7.3% stake in Future Retail as of early this year, according to past regulatory filings.
“The Promoters have also agreed to certain share transfer restrictions on their shares in the Company for same tenure, including restrictions to not transfer shares to specified persons, a right of first offer in favor of Amazon, all of which are subject to mutually agreed exceptions (such as liquidity allowances and affiliate transfers). The transaction contemplated above is subject to obtaining applicable regulatory approvals and customary closing conditions,” Future Retail added.
Amazon has been reportedly looking to acquire as much as 10% stake in Future Retail, which operates over 2,000 stores, including “Big Bazaar” retail stores, across 400 cities in India. Bloomberg reported earlier this month that Future Retail was seeking a valuation of about $281 million for selling stakes in the firm.
Future Retail runs a wide swath of retail brands in India, covering a range of things from grocery, perishables, electronics to fashion apparels. On Thursday, Amazon India announced it was launching Amazon Fresh in parts of Bangalore. Amazon Fresh is currently offering 5,000 kinds of items including fresh fruits, vegetables, meat as well as some items from home and personal product categories.
According to earlier media reports, the company is also in talks to acquire more than 25% stake in Reliance Retail, the largest retail chain in the country. Brick and mortar stores continue to drive much of the sales in the country. Amazon also owns stake in Indian supermarket chain More, and department store chain Shopper’s Stop.
“One thing to keep in mind is that e-commerce is a very, very small portion of total retail consumption in India, probably less than 3%,” said Amit Agarwal, manager of Amazon India, in an interview this week.
Earlier this week, Amazon opened an office in Hyderabad to house over 15,000 employees, thereby making it the company’s biggest campus globally.
India has become the latest battleground for American giants Amazon and Walmart. Amazon India competes with Flipkart, which currently leads the e-commerce market in the nation. Last year, Walmart acquired a majority stake in Flipkart for $16 billion. Like Amazon, Flipkart has also made it no secret that it wants to expand into grocery and other categories.
Both Amazon India and Flipkart took a hit earlier this year in India after New Delhi government enforced some regulatory changes to the way e-commerce conduct business in the country. The changes were largely structured to help local companies.
Amazon India’s Agarwal urged the government to relax the regulatory pushes. “There is so much opportunity to just let e-commerce thrive versus trying to define every single guard rail under which it should operate. I feel e-commerce can actually accelerate India’s economy in a big way, if it’s just allowed to thrive,” he told Reuters.
Zomato, one of India’s biggest food delivery startups, has major ambitions. Now it is also facing some major challenges.
Zomato is increasingly expanding its reach in the country to serve dozens of new cities and towns every month. It is investing heavily in building cloud kitchens to quickly meet customers’ demand for certain food items.
And it is internally working on “Project Kisan,” something which has not been previously reported, to procure raw material directly from farmers and fishermen to better control the supply of items to restaurants. It also wants to deliver food by drones.
To boost its revenue, the 11-year-old firm is trying to bring to users who prefer to eat at home Zomato Gold, a two-year-old subscription service as part of which customers dining in at a restaurant access a number of discounted deals on food and drinks, sources familiar with the matter have told TechCrunch in recent weeks.
Zomato Gold is already a hit. The company expects Gold, which has amassed more than 800,000 customers, to bring in $20 million to $25 million in revenue by end of this year.
But before Zomato goes about extending the program, Zomato Gold’s genesis has come under severe scrutiny from a number of restaurant partners in India who say that the startup’s offering is hurting their bottom line and brand image.
More than 2,000 of the 6,500 restaurant partners of Zomato Gold have opted out of the program in recent days. The disruption occurred over the weekend after the National Restaurant Association of India (NRAI), a trade body that represents more than 500,000 restaurants in the country, kickstarted a #LogOut campaign against Zomato and other dining startups such as Nearbuy, Dineout, EazyDiner and Magicpin.
Image: Manish Singh / TechCrunch
The Gold program was supposed to be a win-win for both Zomato and restaurant partners. Zomato presents users with restaurant menus, the option to book tables and get food delivered to their homes. Through Gold, restaurants were able to get better discovery and win some patrons, but more importantly, garner improved reviews because of the freebies. And for Zomato, which charges a fee for a Gold subscription, it was able to better monetize its customer base.
But somewhere along the line, Zomato opened to everyone what was supposed to be a program for a limited number of subscribers, making it unfeasible for restaurants to handle the additional footfall.
Deepinder Goyal, CEO of Zomato, last week acknowledged the resistance and admitted that the company had made some mistakes. “Somewhere, we have made mistakes and things haven’t gone as planned. This is a wake up call that we need to do 100x more for our restaurant partners than we have done before,” he tweeted.
To resolve the issue, Zomato, which operates in two dozen countries, and other food startups and restaurant partners met earlier this week. That also did not go as planned.
“Over the past two days, NRAI has held extensive meetings with all restaurant aggregators and we were bemused to learn that the aggregators were promoting deep discounts to stay competitive amongst each other. While one aggregator gave 1+1 (one drink or food item free on purchase of another drink or food item), the other had to adopt a 50% discount scheme in order to stay relevant,” Rahul Singh, president of the NRAI, said in a statement.
Singh noted that it is restaurant partners that have to bear the cost of deep discounts that food aggregators offer on their platforms. “Restaurants do not get any share of the proceeds that aggregators generate from guests as subscription fees,” he added.
Zomato, for its part, assured that it will bring changes to its Gold program by mid-September to introduce measures to prevent over usage by customers. But late Wednesday, NRAI rejected the proposal, calling it insufficient, and said restaurants will continue to stay off Zomato.
The restaurant association said the problem is deep discounts that Zomato is bandying out through its Gold program and the startup’s proposed changes don’t really address that.
“It’s a tweak in the drug, which doesn’t solve the addiction. Since the launch in November 2017, this program has been shifting goalposts. What started as an exclusive invite only privilege, became a marketplace for bargain hunters, a word admitted by the Zomato founder in recent tweets. This Gold has lost its sheen. We stand united in the cause to obviate the deep discounting phenomenon and will therefore #stayloggedout,” the NRAI said in a statement.
Things further escalated on Thursday afternoon after Goyal argued that NRAI’s Singh himself practices deep discounting on his own startup, The Beer Cafe.
Here’s what I think is going on – pic.twitter.com/bo4DQTe3Qb
— Deepinder Goyal (@deepigoyal) August 22, 2019
Meanwhile, restaurants have also complained that if they do not accept Zomato’s Gold program, they risk disappointing customers who have come to expect that every eatery has enrolled in Zomato Gold. These customers then leave bad ratings on Zomato, which significantly affects the number of orders they get, they say. Zomato makes most of its revenue from promoting and selling listings on its platform.
A Zomato spokesperson told TechCrunch that the company was committed to making some changes to its program. Goyal added, “Zomato is logging out of the logout campaign. We have said enough and we are getting back to work. I am confident better business sense will prevail at the end.”
Hey. This is Week-in-Review, where I give a heavy amount of analysis and/or rambling thoughts on one story while scouring the rest of the hundreds of stories that emerged on TechCrunch this week to surface my favorites for your reading pleasure.
Last week, I talked about how Netflix might have some rough times ahead as Disney barrels towards it.
There is plenty to be said about the potential of smart glasses. I write about them at length for TechCrunch and I’ve talked to a lot of founders doing cool stuff. That being said, I don’t have any idea what Snap is doing with the introduction of a third-generation of its Spectacles video sunglasses.
The first-gen were a marketing smash hit, their sales proved to be a major failure for the company which bet big and seemingly walked away with a landfill’s worth of the glasses.
Snap’s latest version of Spectacles were announced in Vogue this week, they are much more expensive at $380 and their main feature is that they have two cameras which capture images in light depth which can lead to these cute little 3D boomerangs. One one hand, it’s nice to see the company showing perseverance with a tough market, on the other it’s kind of funny to see them push the same rock up the hill again.
Snap is having an awesome 2019 after a laughably bad 2018, the stock has recovered from record lows and is trading in its IPO price wheelhouse. It seems like they’re ripe for something new and exciting, not beautiful yet iterative.
The $150 Spectacles 2 are still for sale, though they seem quite a bit dated-looking at this point. Spectacles 3 seem to be geared entirely towards women, and I’m sure they made that call after seeing the active users of previous generations, but given the write-down they took on the first-generation, something tells me that Snap’s continued experimentation here is borne out of some stubbornness form Spiegel and the higher-ups who want the Snap brand to live in a high fashion world and want to be at the forefront of an AR industry that seems to have already moved onto different things.
On to the rest of the week’s news.
Here are a few big news items from big companies, with green links to all the sweet, sweet added context:
How did the top tech companies screw up this week? This clearly needs its own section, in order of badness:
Adam Neumann (WeWork) at TechCrunch Disrupt NY 2017
Our premium subscription service had another week of interesting deep dives. My colleague Danny Crichton wrote about the “tech” conundrum that is WeWork and the questions that are still unanswered after the company filed documents this week to go public.
…How is margin changing at its older locations? How is margin changing as it opens up in places like India, with very different costs and revenues? How do those margins change over time as a property matures? WeWork spills serious amounts of ink saying that these numbers do get better … without seemingly being willing to actually offer up the numbers themselves…
Here are some of our other top reads this week for premium subscribers. This week, we published a major deep dive into the world’s next music unicorn and we dug deep into marketplace startups.
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Each month millions of Indians are coming online for the first time, making India the last great growth market for internet companies worldwide. But winning them presents its own challenges.
These users, most of whom live in small cities and villages in India, can’t speak English. Their interests and needs are different from those of their counterparts in large cities. When they come online, the world wide web that is predominantly focused on the English-speaking masses, suddenly seems tiny, Google executives acknowledged at a media conference last year. According to a KPMG-Google report (PDF) on Indian languages, there will be 536 million non-English speaking users using internet in India by 2021.
Many companies are increasingly adding support for more languages, and Silicon Valley giants such as Google are developing tools to populate the web with content in Indian languages.
But there is still room for others to participate. On Friday, a new startup announced it is also in the race. And it has already received the backing of Y Combinator (YC).
Lokal is a news app that wants to bring local news to hundreds of millions of users in India in their regional languages. The startup, which is currently available in the Telugu language, has already amassed more than two million users, Jani Pasha, co-founder of Lokal, told TechCrunch in an interview.
There are tens of thousands of publications in India and several news aggregators that showcase the top stories from the mainstream outlets. But very few today are focusing on local news and delivering it in a language that the masses can understand, Pasha said.
Lokal is building a network of stringers and freelance reporters who produce original reporting around the issues and current affairs of local towns and cities. The app is updated throughout the day with regional news and also includes an “information” stream that shows things like current price of vegetables, upcoming events and contact details for local doctors and police stations.
The platform has grown to cover 18 districts in South India and is slowly ramping up its operations to more corners of the country. The early signs show that people are increasingly finding Lokal useful. “In 11 of the 18 districts we cover, we already have a larger presence and reader base than other media houses,” Pasha said.
Before creating Lokal, Pasha and the other co-founder of the startup, Vipul Chaudhary, attempted to develop a news aggregator app. The app presented news events in a timeline, offering context around each development.
“We made the biggest mistake. We built the product for four to five months without ever consulting with the users. We quickly found that nobody was using it. We went back to the drawing board and started interviewing users to understand what they wanted. How they consumed news, and where they got their news from,” he said.
“One thing we learned was that most of these users in tier 2 and tier 3 India still heavily rely on newspapers. Newspapers still carry a lot of local news and they rely on stringers who produce these news pieces and source them to publications,” he added.
But newspapers have limited pages, and they are slow. So Pasha and the team tried to build a platform that addresses these two things.
Pasha tried to replicate it through distributing local news, sourced from stringers, on a WhatsApp group. “That one WhatsApp group quickly became one of many as more and more people kept joining us,” he recalls. And that led to the creation of Lokal.
Along the journey, the team found that classifieds, matrimonial ads and things like birthday wishes are still driving people to newspapers, so Lokal has brought those things to the platform.
Pasha said Lokal will expand to three more states in the coming months. It will also begin to experiment with monetization, though that is not the primary focus currently. “The plan is to eventually bring this to entire India,” he said.
A growing number of startups today are attempting to build solutions for what they call India 2 and India 3 — the users who don’t live in major cities, don’t speak English and are financially not as strong.
ShareChat, a social media platform that serves users in 15 regional languages — but not English — said recently it has raised $100 million in a round led by Twitter. The app serves more than 60 million users each month, a figure it wants to double in the next year.
Is there room for another social media platform? ShareChat, a four-year-old social network in India that serves tens of million of people in regional languages, just answered that question with a $100 million financing round led by global giant Twitter .
Other than Twitter, TrustBridge Partners, and existing investors Shunwei Capital, Lightspeed Venture Partners, SAIF Capital, India Quotient and Morningside Venture Capital also participated in the Series D round of ShareChat.
The new round, which pushes ShareChat’s all-time raise to $224 million, valued the firm at about $650 million, a person familiar with the matter told TechCrunch. ShareChat declined to comment on the valuation.
Screenshot of Sharechat home page on web
“Twitter and ShareChat are aligned on the broader purpose of serving the public conversation, helping the world learn faster and solve common challenges. This investment will help ShareChat grow and provide the company’s management team access to Twitter’s executives as thought partners,” said Manish Maheshwari, managing director of Twitter India, in a prepared statement.
ShareChat serves 60 million users each month in 15 regional languages, Ankush Sachdeva, co-founder and CEO of the firm, told TechCrunch in an interview. The platform currently does not support English, and has no plans to change that, Sachdeva said.
That choice is what has driven users to ShareChat, he explained. In the early days of the social media platform, the firm experimented with English language. It saw most of its users choose English as their preferred language, but this also led to another interesting development: Their engagement with the app significantly reduced.
“For some reason, everyone wanted to converse in English. There was an inherent bias to pick English even when they did not know it.” (Only about 10% of India’s 1.3 billion people speak English. Hindi, a regional language, on the other hand, is spoken by about half a billion people, according to official government figures.)
So ShareChat pulled support for English. Today, an average user spends 22 minutes on the app each day, Sachdeva said. The learning in the early days to remove English is just one of the many things that has shaped ShareChat to what it is today and led to its growth.
In 2014, Sachdeva and two of his friends — Bhanu Singh and Farid Ahsan, all of whom met at the prestigious institute IIT Kanpur — got the idea of building a debate platform by looking at the kind of discussions people were having on Facebook groups.
They identified that cricket and movie stars were popular conversation topics, so they created WhatsApp groups and aggressively posted links to those groups on Facebook to attract users.
It was then when they built chatbots to allow users to discover different genres of jokes, recommendations for phones and food recipes, among other things. But they soon realized that users weren’t interested in most of such offerings.
“Nobody cared about our smartphone recommendations. All they wanted was to download wallpapers, ringtones, copy jokes and move on. They just wanted content.”
So in 2015, Sachdeva and company moved on from chatbots and created an app where users can easily produce, discover and share content in the languages they understand. (Today, user generated content is one of the key attractions of the platform, with about 15% of its user base actively producing content.)
A year later, ShareChat, like tens of thousands of other businesses, was in for a pleasant surprise. India’s richest man, Mukesh Ambani, launched his new telecom network Reliance Jio, which offered users access to the bulk of data at little to no charge for an extended period of time.
This immediately changed the way millions of people in the country, who once cared about each megabyte they consumed online, interacted with the internet. On ShareChat people quickly started to move from sharing jokes and other messages in text format to images and then videos.
That momentum continues to today. ShareChat now plans to give users more incentive — including money — and tools to produce content on the platform to drive engagement. “There remains a huge hunger for content in vernacular languages,” Sachdeva said.
Speaking of money, ShareChat has experimented with ads on the app and its site, but revenue generation isn’t currently its primary focus, Sachdeva said. “We’re in the Series D now so there is obviously an obligation we have to our investors to make money. But we all believe that we need to focus on growth at this stage,” he said.
ShareChat also has many users in Bangladesh, Nepal and the Middle East, where many users speak Indian regional languages. But the startup currently plans to focus largely on expanding its user base in India.
It will use the new capital to strengthen the technology infrastructure and hire more tech talent. Sachdeva said ShareChat is looking to open an office in San Francisco to hire local engineers there.
A handful of local and global giants have emerged in India in recent years to cater to people in small cities and villages, who are just getting online. Pratilipi, a storytelling platform has amassed more than 5 million users, for instance. It recently raised $15 million to expand its user base and help users strike deals with content studios.
Perhaps no other app poses a bigger challenge to ShareChat than TikTok, an app where users share short-form videos. TikTok, owned by one of the world’s most valued startups, has over 120 million users in India and sees content in many Indian languages.
But the app — with its ever growing ambitions — also tends to land itself in hot water in India every few weeks. In all sensitive corners of the country. On that front, ShareChat has an advantage. Over the years, it has emerged as an outlier in the country that has strongly supported proposed laws by the Indian government that seek to make social apps more accountable for content that circulates on their platforms.
Paytm, India’s biggest mobile payments firm, now has 10 million customers in Japan, the company said as it pushes to expand its reach in international markets.
Paytm entered Japan last October after forming a joint venture with SoftBank and Yahoo Japan called PayPay.
In addition to 10 million users, PayPay is now supported by 1 million local stores in Japan, Vijay Shekhar Sharma, founder and CEO of Paytm said Thursday. The mobile payment services has clocked 100 million transactions to date, he claimed.
“Thank you India for your inspiration and giving us chance to build world class tech,” he posted in a tweet.
More to follow…
The company—which has a robust Africa sales network—could raise up to 3 billion yuan (or $426 million).
“The company’s listing-related work is running smoothly. The registration application and issuance process is still underway, with the specific timetable yet to be confirmed by the CSRC and Shanghai Stock Exchange,” a spokesperson for Transsion’s Office of the Secretary to the Chairman told TechCrunch via email.
STAR is the Shanghai Stock Exchange’s new Nasdaq-style board for tech stocks that also went live in July with some 25 companies going public.
Headquartered in Shenzhen—where African e-commerce unicorn Jumia also has a logistics supply-chain facility—Transsion is a top-seller of smartphones in Africa under its Tecno brand.
The company has a manufacturing facility in Ethiopia and recently expanded its presence in India.
Transsion plans to spend the bulk of its STAR Market raise (1.6 billion yuan or $227 million) on building more phone assembly hubs and around 430 million yuan ($62 million) on research and development, including a mobile phone R&D center in Shanghai—a company spokesperson said.
Transsion recently announced a larger commitment to capturing market share in India, including building an industrial park in the country for manufacture of phones to Africa.
The IPO comes after Transsion announced its intent to go public and filed its first docs with the Shanghai Stock Exchange in April.
Listing on the STAR Market will put Transsion on the freshly minted exchange seen as an extension of Beijing’s ambition to become a hub for high-potential tech startups to raise public capital. Chinese regulators lowered profitability requirements, for the exchange, which means pre-profit ventures can list.
Transsion’s IPO process comes when the company is actually in the black. The firm generated 22.6 billion yuan ($3.29 billion) in revenue in 2018, up from 20 billion yuan from a year earlier. Net profit for the year slid to 654 million yuan, down from 677 million yuan in 2017, according to the firm’s prospectus.
Transsion sold 124 million phones globally in 2018, per company data. In Africa, Transsion holds 54% of the feature phone market—through its brands Tecno, Infinix, and Itel—and in smartphone sales is second to Samsung and before Huawei, according to International Data Corporation stats.
Transsion has R&D centers in Nigeria and Kenya and its sales network in Africa includes retail shops in Nigeria, Kenya, Tanzania, Ethiopia and Egypt. The company also attracted attention for being one of the first known device makers to optimize its camera phones for African complexions.
On a recent research trip to Addis Ababa, TechCrunch learned the top entry-level Tecno smartphone was the W3, which lists for 3600 Ethiopian Birr, or roughly $125.
In Africa, Transsion’s ability to build market share and find a sweet spot with consumers on price and features gives it prominence in the continent’s booming tech scene.
Africa already has strong mobile-phone penetration, but continues to undergo a conversion from basic USSD phones, to feature phones, to smartphones.
Smartphone adoption on the continent is low, at 34 percent, but expected to grow to 67 percent by 2025, according to GSMA.
This, added to an improving internet profile, is key to Africa’s tech scene. In top markets for VC and startup origination—such as Nigeria, Kenya, and South Africa—thousands of ventures are building business models around mobile-based products and digital applications.
If Transsion’s IPO enables higher smartphone conversion on the continent that could enable more startups and startup opportunities—from fintech to VOD apps.
Another interesting facet to Transsion’s IPO is its potential to create greater influence from China in African tech, in particular if the Shenzhen company moves strongly toward venture investing.
Comparatively, China’s engagement with African startups has been light compared to China’s deal-making on infrastructure and commodities—further boosted in recent years as Beijing pushes its Belt and Road plan.
Transsion’s IPO move is the second recent event—after Chinese owned Opera’s big venture spending in Nigeria—to reflect greater Chinese influence and investment in the continent’s digital scene.
So in coming years, China could be less known for building roads, bridges, and buildings in Africa and more for selling smartphones and providing VC for African startups.
Eleven million women in the U.S. live more than an hour from an abortion clinic, a number expected to increase as facilities close up shop following new restrictions on women’s healthcare in several states.
Planned Parenthood and other leading nonprofits continue to put up a good fight while private “mission-driven” companies in the burgeoning women’s health tech sector are all talk and little action. But a new effort from The Pill Club, an Alphabet-backed birth control and prescription delivery startup, may lead to change in the nascent sector.
The Pill Club has partnered with Power To Decide, a nonprofit campaign to prevent unplanned pregnancies, to dole out free emergency contraception to women in need. Together they’ll distribute 5,000 units of a generic form of Plan B, a pill taken after sex to stop a pregnancy before it starts. For the next three months The Pill Club will also match all donations up to $10,000 made to Power To Decide’s Contraceptive Access Fund, which helps low-income women access contraception. Anyone can sign up now to receive free units.
The Pill Club’s decision to share resources with a nonprofit comes as several states this year have imposed new laws restricting or outlawing abortion procedures. Alabama, for example, earlier this year passed a Senate bill banning abortion in the state. Arkansas, Indiana, Kentucky and others have also OK’d new restrictions on abortion.
This is The Pill Club’s first effort to donate emergency contraception to populations in need, as well as its first partnership with a not-for-profit entity. Co-founder and chief executive officer Nick Chang says the startup thought long and hard about how it could be most helpful to women in this political climate.
“We thought, what can we do to support women in these states in ways that other companies may not be able to?,” Chang tells TechCrunch. “This is the moment where private companies can really go out and benefit women in ways that may not be supported in other avenues. Since we have the means and ability to do it in ways that are more convenient and private, it’s our opportunity to drive access and support.”
Founded in 2014 and backed with more than $60 million in venture capital funding, one might argue The Pill Club should have forged partnerships like this from the get-go. Curious what efforts other well-funded birth control startups were making to support women in 2019, especially women in contraceptive deserts who are likely unfamiliar with the new line of consumer birth control brands, I reached out to The Pill Club’s competitors Nurx, a fellow birth control delivery company, and Hers, a line of women’s healthcare products owned by the billion-dollar startup Hims.
Both companies emphasized the fact that many of their customers live in Southern states, or the region most impacted by new limitations to abortion care, but didn’t mention any new efforts to increase access, like partnerships with nonprofits or donations. Hers provided this quote from the company’s co-founder Hilary Coles, which didn’t answer my question but did make clear the company is thinking about serving contraceptive deserts:
“At Hers, our mission is to provide women with more convenient and affordable access to the healthcare system,” Hers co-founders Hilary Coles said in a statement. “Approximately 3.5 million patients go without care because they cannot access transportation to their providers and 19.5 million women have reported not having access to a clinic that provides birth control specifically. That’s simply unacceptable. Closing the gaps caused by geographic barriers between patients and their doctors was one of the primary challenges we set out to address when founding Hers. We’re proud to be a resource for women nationwide, including those who live in contraceptive deserts who may not otherwise have access to the care they need. It’s crucial to Hers to be part of the solution in alleviating the pain points women experience within the healthcare system.”
It’s not the responsibility of these companies to improve the political landscape of the U.S., but with $340 million in private capital shared between them, the trio does have a unique opportunity to innovate, share, collaborate and influence. After all, that’s what’s so great about healthtech; it brings new, innovative solutions to an industry characterized by antiquated systems and slow movers. For once, Silicon Valley’s “move fast and break things” mantra may be appropriately applied to a facet of healthcare. Women need sustained access to contraception and abortion care. Fast.
“This is the time when private companies can step in,” Chang concluded. “We can come in and help out and it’s our responsibility to do that.”
India’s e-commerce giant Flipkart said on Tuesday that it is revamping its shopping app to add support for Hindi language, a video streaming service, and an audio-visual assistant, the latest in a series of recent efforts to expand its reach in the country.
The e-commerce firm, which sold majority stake to Walmart for $16 billion last year and leads the local market, told TechCrunch that it has started to rollout the features on its shopping app and will push it to all its existing users in within next 20 days.
Only 10% of India’s 1.3 billion people speak English. Flipkart said it has been working to customize its entire platform for several months to add support for Hindi. As part of the revamp, the company is also introducing an “audio visual guided navigation” feature, also built in Hindi, that is aimed at first time internet users — and existing online users not comfortable with making transactions online — to make it easier for them to navigate the site and place orders.
As part of the accessibility push, Flipkart is also introducing an in-app video streaming feature dubbed ‘Flipkart Videos,’ that will syndicate movies, shows, and other long-form and short form content from a number of production houses and movie studios, the company said.
Its rival Amazon India added support for Hindi last year, though the feature is limited to basic text translation.
The inclusion of video streaming feature comes as Indians’ appetite for consuming media content on the internet has ballooned in the recent years. Hotstar, a Disney-owned video streaming service, has amassed more than 300 million monthly active users in the country.
Flipkart said the video streaming feature will enable it to invite a new segment of users to its platform who are online but don’t currently shop on the internet. Even as more than 500 million users are connected to the web in India, only tens of millions of them currently shop there. The streaming feature will be accessible to all users at no charge without any loyalty program, a company spokesperson said, refuting a recent media report that claimed the feature will be limited to loyalty customers.
“In the past 10 years our vision and ethos have been to solve for ‘Real India,’ create India specific tech solutions, here in India. What we are rolling out when it comes to addressing the needs of the next 200 million users in our country, is taking forward those founding principles of access and affordability,” said Kalyan Krishnamurthy, Group CEO of Flipkart, in a statement.
“We strongly believe that the next phase of our growth is rooted in loyalty , democratizing e-commerce and the country will continue seeing more innovations that stem from our deep understanding of Indian consumers, especially middle India.”
Flipkart said it is also attempting to make it easier for users to discover items on its app. So it is introducing a feed called ‘Flipkart Ideas’ that will populate short form videos, animated images, polls and quizzes.
For instance, a user may see a short form video that shows a sportsperson wearing a pair of sneakers, a t-shirt, a pair of jeans, and a cap. If they tap on the video, they will see the exact items the person in the video is wearing and other similar items. One more tap, and the user would be able to purchase any of those items.
The company said it is working with more than 400 influencers and 30 brands to create content that will appear on the feed.
All of these features, as well as a gaming section that Flipkart introduced last year, will now appear at the bottom of the screen for easier navigation, the company said. More than half a million users in India play mini-games on Flipkart everyday. The company said it will introduce more games to boost engagement levels and offer loyalty points as incentive to customers.
Indifi, a Gurgaon-based startup that offers loans to small and medium-sized businesses and also operates an online lending marketplace, has raised 1,450 million Indian rupees ($21 million) in a new financing round to expand its business in the country.
The Series C round for the four-year-old startup was led by CDC Group, a U.K.-government-owned VC fund. Existing investors Accel, Elevar Equity, Omidyar Networks and Flourish Ventures also participated in the round, the startup announced on Tuesday (Indian Standard Time).
Indifi, which has raised about $34 million in venture capital to date, has also relied on debt to grow and finance loans on its platform. Currently, it’s in about $21 million in debt, Alok Mittal, co-founder and managing director of Indifi, told TechCrunch in an interview.
Indifi, which itself finances some loans, additionally also serves as a marketplace for banks and non-banking financial companies to participate in funding loans to small and medium-sized enterprises, said Mittal. Both the businesses are equally growing and contributing to its bottom line, he said.
A typical loan processed by Indifi is of about $7,000 in size. Overall, the startup offers between $1,400 to $70,000 in capital to businesses.
Unlike banks and many other online lenders, Indifi works with an ecosystem of companies to assess risk factors before granting a loan to a business, Mittal said. For instance, Indifi works with food-delivery startups Zomato and Swiggy and checks a restaurant’s history and feedback from their customers before issuing to a restaurant.
Similarly, if an enterprise from the travel industry were to look for a loan, Indifi checks the volatility of the market. Some of its other business partners include Oyo Rooms, MakeMyTrip, Flipkart, FirstData, Travel Booking and Riya Travel.
“We chose to invest in Indifi because of its advanced data-driven approach that enables it to reach [thousands] of underserved customers across India. By reducing the high cost of risk assessment and customer acquisition, Indifi helps formal and informal businesses to access growth finance that otherwise may not receive it,” Srini Nagarajan, managing director and head of CDC Group’s Asia business, said in a statement.
Despite its longer background check process, Mittal said Indifi has been able to finance nearly 50% of all the applications it gets, compared to about 10% deals that materialize with banks and other lenders.
Indifi, which spent the first year and a half of its existence building relationships with major companies and refining its products, has amassed more than 15,000 customers to date, Mittal said. Its client base has grown by 2.5 times in the past year, he said.
The startup will use the fresh capital to find new clients and lending partners to expand its marketplace business, Mittal said. It will also explore lending to businesses in more sectors, including logistics (so fleet-owners could also get loan).
Indian conglomerate Reliance Industries is acquiring 87.6% stake in Fynd, a seven-year-old Mumbai-based startup that connects brick and mortar retailers with online stores and consumers, for 2.95 billion Indian rupees ($42.33 million), the two said in a brief statement late Saturday.
Fynd, which was founded in 2012, helps offline retailers sell their products to consumers directly through its online store, and also enables them connect with other “demand channels” such as third-party e-commerce platforms Amazon India and Walmart-owned Flipkart.
More than 600 brands including Nike, Raymond, Global Desi, and Being Human, and 9,000 stores are connected through Fynd’s platform, Harsh Shah, co-founder and CEO of Fynd, told TechCrunch in an interview. Many brands use Fynd’s products to also ramp up sales in their own respective e-commerce businesses.
Since Fynd works directly with brands, it offers a wider selection of items and newer inventories to consumers, as well as faster delivery, Shah claimed.
Reliance Industries, which owns the nation’s biggest physical retail chain Reliance Retail, has been a customer of Fynd for more than six years, Shah said. “Reliance runs a few major brands in the country. 25 of our existing brands are owned by them. Our Find Store product has helped their stores plug a lot of sales,” he said.
Fynd, which counts Google as one of its early investors, will continue to operate its existing business and has an option to secure an additional 1 billion India rupees ($14 million) by end of 2021 from Reliance Industries, Shah said. He declined to reveal how much capital his startup had raised prior to this week’s announcement. According to Crunchbase, Fynd has raised about $7.3 million.
“Reliance is taking the majority stake in Fynd, but at the end of the day, for us it is like any other investor coming in. We will still continue to work separately, we have our own independent roadmap, and we have own clients and products that we plan to grow. So things continue as it is,” he said.
Fynd, which takes a small commission on each transaction that occurs online, is already profitable on an operating level and expects to be fully profitable in the coming quarters, Shah said.
It will continue to build and scale its existing products, including OpenAPI that allows merchants to quickly list their products on either their own stores or third-party sites and manage their inventories and sales.
Despite tens of billions of dollars of investment in India’s e-commerce market in recent years by Amazon India and Flipkart, physical retail dominates the sales in the country. But e-commerce businesses in India are growing, too.
The nation’s e-commerce space is estimated to scale to $84 billion by 2021, up from $24 billion in 2017; compared to India’s overall retail market that is estimated to be worth $1.2 trillion by 2021, according to a recent study by Deloitte India and Retail Association of India.
Reliance Industries, run by Asia’s richest man Mukesh Ambani (pictured above), additionally has its own plan to enter the e-commerce business. Earlier this year, Ambani announced that his telecom operator Reliance Jio and Reliance Retail are working on an e-commerce platform.
Reliance Jio, which began its commercial operations in the second half of 2016, recently became the nation’s biggest telecom operator with more than 331 million subscribers at the end of June.
UrbanClap, a startup that offers home services across India and UAE, has raised $75 million to expand its business.
The Series E round for the four-and-half-year-old Gurgaon-based startup was led Tiger Global. Existing investors Steadview Capital, which led the startup’s Series D round, and Vy Capital also participated in the round. The startup has raised about $185 million to date, according to Crunchbase.
The financing round was split into two parts — a primary round which resulted in a share subscription by the aforementioned investors and a secondary share sale by some of its early backers, the startup said in a brief statement.
Through its platform, UrbanClap matches service people such as cleaners, repair staff and beauticians with customers across 10 cities in India and Dubai and Abu Dhabi. The startup supports 20,000 “micro-franchisees” (service professionals) with around 450,000 transactions taking place each month, cofounder and CEO Abhiraj Bhal told TechCrunch.
Bhal said that UrbanClap helps offline service workers in India, who have traditionally relied on getting work through middleman such as some store or word of mouth networks, to find more work. And they earn more, too. UrbanClap offers a more direct model, with workers keeping 80% of the cost of their jobs. That, Bhal said, means workers can earn multiples more and manage their own working hours.
“The UrbanClap model really allows them to become service entrepreneurs. Their earnings will shoot up two or three-fold, and it isn’t uncommon to see it rise as much as 8X — it’s a life-changing experience,” he said. Average value of a service is between $17 to $22, according to the company.
In recent years, UrbanClap has also began offering training, credit, basic banking services through its platform. On its website, UrbanClap claims to offer 73 services — including kitchen cleaning, hairdressing, and yoga training. It says it has served 3 million customers.
Bhal said that around 20-25% of applicants are accepted into the platform, that’s a decision based on in-person meetings, background and criminal checks, as well as a “skills” test. Workers are encouraged to work exclusively — though it isn’t a requirement — and they wear UrbanClap outfits and represent the brand with customers.