Here's a quick wrap of all the startup stories that matter.
Here are the top headlines from startup space this week
Byju's owes Rs 86.21 Cr to BCCI; Paytm wants to exit as title sponsor of Indian cricket team
Indian cricket team's jersey sponsor Byju's allegedly owes Rs 86.21 crore as dues to the Board of Control for Cricket in India (BCCI), as per a report by PTI.
It was only in April that the edtech company and the BCCI had agreed on the extension of their partnership until the end of the 2023 ODI World Cup in India at a 10 percent increment.
The issue was discussed by the BCCI Apex Council on Thursday. "As of today, Byju's owes dues of Rs 86.21 crore to the Board," a BCCI source told PTI after the meeting.
When CNBC-TV18 reached out to BYJU’s, the edtech giant refuted the claims and said, “We are extremely proud to be the principal sponsor of the Indian cricket team. No outstanding payment is due. We are extending the contract, the payment terms for which will be in compliance with the new contract.”
In other development, fintech company Paytm has requested the BCCI to assign their India Home Cricket title rights to Mastercard, the report said. "Paytm has requested the BCCI for reassignment and the board is considering it," the source told PTI.
Karti Chidambaram calls for a probe into the finance of edtech giant BYJU’s
Member of Parliament (MP) Karti Chidambaram has written to fraud regulator Serious Fraud Investigation Office (SFIO), requesting a thorough investigation into the finances of India’s most valuable startup Byju’s. The MP has cited reports that suggested the firm has yet to secure $250 million investment from its $800 million funding round announced in March.
The letter comes after reports have said that Byju’s is yet to receive funds from Sumeru Ventures and Oxshott that have committed to investing about $250 million in the edtech firm.
Alleging loopholes in BYJU’S finances, Chidambaram called for a probe into the edtech giant for not submitting its statements for the financial year FY22.
Chidambaram in his letter highlighted that Byju’s is yet to get its 2020-21 (FY21) financial results signed from its auditor Deloitte and could take another few weeks for the company to file them with the ministry of corporate affairs (MCA).
In the letter he said, “This is a clear violation of Rule 6(5) of the companies (Cost Records and Audits) Rules, 2014.”
Licensed digital lenders violating specified domain not acceptable, says RBI governor
The guidelines to govern lending through digital platforms will be out in a few weeks, according to Reserve Bank of India (RBI) Governor Shaktikanta Das. The regulator expects licensed entities to operate within the permitted territory.
"It has taken more time than we had initially presumed, but the situation is so complex. you know, we are being very careful and very cautious. On one hand, we have to support innovation, on the other we have to maintain financial stability," Das said on July 22.
“Our responsibility is to ensure financial stability. If we have given a licence to a particular entity, we expect them to operate within that domain. If they want to do something over and above that, they need to seek permission from us (RBI). If they are building anything beyond what their licence permits, then it is not acceptable. We cannot allow a scenario where risk is building up."
The working committee, which is responsible for setting the norms, is looking into matters of unregulated entities lending, as well as licensed entities entering into activities they are prohibited from undertaking, he mentioned.
The fintech industry is awaiting the guidelines on digital lending which will impact all companies lending through online platforms like apps and websites. The Governor had earlier said on June 17 that the guidelines should be out ‘shortly’.
Ola to invest Rs 4000 crore in Asia's largest EV battery R&D unit in Bengaluru
SoftBank Group-backed Ola Electric is planning to invest around Rs 4,000 crore ($500 million) to set up Battery Innovation Center (BIC) in Bengaluru to develop a futuristic and localised cell technology.
Spanning across half a million square feet, BIC will be one of the world's largest cell R&D centres and will recruit top industry talent, including 500 PhDs and engineers at full strength, Ola said in a statement.
The Battery Innovation Center will be the largest cell R&D facility in Asia, claims the Bangalore-based company. The unit will be up and running next month.
India needs global support to implement crypto ban: Nirmala Sitharaman
Union Finance Minister Nirmala Sitharaman has said the Reserve Bank of India (RBI) has registered its concern over the adverse effect of cryptocurrencies on the economy and recommended prohibiting them by framing regulations.
"Given the concerns on the destabilising effect of cryptocurrencies on a country's monetary and fiscal stability, the RBI has recommended framing of legislation on this sector. The RBI is of the view that cryptocurrencies should be prohibited," she said in a written response to a question in the Lok Sabha.
The government, however, has viewed a need for a global collaboration for any effective regulation or ban, given the borderless nature of these currencies.
US lobby groups cast doubts over independence of India content appeal panel: Report
US lobby groups representing Facebook and Twitter are concerned India's plan to form a government panel to hear appeals against content moderation decisions could lack independence, documents seen by Reuters show.
The proposed policy change is the latest flashpoint between India and technology giants which have for years said stricter regulations are hurting their business and investment plans.
The June proposal mandates social media companies must comply with a newly formed government panel which will decide on user complaints against content moderation decisions. The government has not specified who would be on the panel.
Delhi HC stays guidelines barring levying of service charge by restaurants and hotels
The Delhi High Court has stayed the recent guidelines issued by the Central Consumer Protection Authority (CCPA) prohibiting restaurants and hotels from levying service charge on food bills.
Justice Yashwant Varma, while dealing with petitions by the National Restaurant Association of India (NRAI) and Federation of Hotels and Restaurant Associations of India challenging the CCPA's July 4 guidelines, said the issue requires consideration and directed the authorities to file their reply.
Meanwhile, government sources told CNBC-TV18 that they were waiting for the exact written order given by the High Court on the service charge matter.
Logistics and fulfillment startup Shiprocket acquires Arvind’s SaaS business for Rs 200 Cr
Logistics and fulfillment startup Shiprocket has acquired textile company Arvind’s omnichannel SaaS business Omuni in a Rs 200-crore cash-and-stock deal.
The acquisition will help both the companies to facilitate quick, efficient deliveries of shipments from the nearest store of warehouse, thus reducing delivery timelines and enhancing customer satisfaction, a statement said.
M2P Fintech marks its fifth acquisition with Syntizen
API infrastructure provider M2P Fintech has acquired Syntizen, an identity verification service provider for an undisclosed amount. As part of the deal, Syntizen’s cofounder and chief executive Vamsi Kotte will take up the product leadership role at M2P.
With Syntizen, M2P fintech has marked its fifth acquisition this year. It acquired cloud lending platform Finflux earlier this month. Prior to this, it also acquired credit card sourcing startup Wizi, SaaS startup Origa and banking solution provider BSG ITSOFT this year.
Hesa acquires Flinkhub for an undisclosed sum
Rural commerce startup Hesa has acquired sales intelligence startup Flinkhub for an undisclosed capital.
The deal will enhance Hesa’s super app and drive product-led growth, the firm said. Flinkhub’s co-founders Ashish Rajput, Ananth SNC and Jerrin Joy will join Hesa post the acquisition.
Flinkhub has 2 products - relationship intelligence, a tool that maps a user’s network and Papertown, a social networking app for learning. Hesa will use these technologies for product-led acquisition and training of their network of village-level entrepreneurs (VLEs), the company added.
OTHER STARTUP NEWS
Sequoia, Tiger Global lead startup funding in April-June: Nasscom report
Venture capital firms Sequoia Capital and Tiger Global led funding in Indian startups during April-June, with the fintech sector attracting most of the $6 billion (about Rs 47,870 crore) investments made during the quarter, industry body Nasscom said in a report.
Fintech firms attracted about 26 percent of the total investments made during the quarter, followed by media and entertainment (19 percent), enterprise tech (16 percent), retail tech (9 per cent), edtech (8 percent) and health tech (5 percent), according to the report.
"Prominent investors Sequoia Capital, Tiger Global, Alpha wave and Accel have done over 6 deals across sectors," it added.
PE/ VC investments increased by 28% to $34.1Bn Y-O-Y in the first half of 2022: IVCA-EY report
Private equity and venture capital investments in the first half of 2022 increased by 28 percent to 34.1 billion dollars year-on-year, due to large growth and startup investments, as per an IVCA and EY report.
Amidst the funding winter, the Indian startup ecosystem received PE\VC investments worth $34.1 billion across 714 deals, including 92 large deals worth $23.7 billion in the first half of this year.
The largest deals in 1H22 saw Bodhi Tree acquire a 40 percent stake in Viacom18 for $1.8 billion followed by CPPIB, Sofina, Sumeru Ventures and others investing close to $805 million in Dailyhunt.
Snapdeal will go live on ONDC platform next month, to cover over 2500 cities and towns
E-commerce platform, Snapdeal, will debut on the Open Network for Digital Commerce (ONDC) next month. The company entered into the onboarding agreement to join the ONDC platform earlier this month. Teams on both sides are close to completing the technical integration needed for a pan-India launch by the middle of August.
At the time of launch, access will be available in over 2,500 cities and towns nationwide, and as the ONDC network is expanded during the year, more cities and towns will be added. Various inter-city and intra-city logistics will be provided by several independent logistics companies that collaborate with Snapdeal.
Snapdeal will debut on ONDC with three major categories: fashion, home, and beauty & personal care.
LetsVenture’s Shanti Mohan launches new VC fund Propell, to invest Rs 50 Cr in early-stage startups
Shanti Mohan, the cofounder and CEO of investor syndicate platform LetsVenture, has launched a new micro venture capital (VC) firm Propell, to invest in early-stage startups.
The fund is aiming to deploy Rs 50 crore in a total of 30 startups across sectors like e-commerce, fintech, Software-as-a-Service (SaaS) and direct-to-consumer (D2C). The fund, which was founded in late 2021, has already invested in 15 startups. Propell will look to invest in 15 additional early-stage startups in the next one year.
The micro fund will be part of LetsVenture platform and is anchored by angel investors such as Reliance Jio president Vikas Choudhury and supported by the likes of Vivek Khare, advisor-corporate development and early-stage investments, Naukri.com; and Sudhi Herle, engineering, Android Platform at Google.
C-CAMP launches IDHA programme for deep tech innovations in digital health startups
The Centre for Cellular and Molecular Platforms (C-CAMP), a Department of Biotechnology (DBT) supported- initiative, has launched a dedicated accelerator programme, India Digital Health Accelerator (IDHA).
IDHA will identify, fund and fast-track promising digital health startups which are working on path-breaking technologies to improve health and have a strong potential for growth and scalability, a statement said.
FableStreet launches house-of-brands entity FS Life
Fireside Ventures-backed D2C western wear brand FableStreet has pivoted from a single brand into a house of brands under the umbrella FS Life to focus on the lifestyle space.
Under FS Life, the firm has launched Mikoto, a jewellery brand, and Marigold, a modern Indian wear brand. All brands will be playing in the mass-premium to premium categories, a statement said.
The startup added that all brands will continue to operate on their own D2C channels, and also be available on marketplaces.
T-Hub launches 9th cohort of its flagship program Lab32
T-Hub, a Hyderabad-based startup ecosystem enabler has launched the 9th cohort of Lab32, its seed accelerator programs.
The new cohort will focus on startups working on solutions for industries like Deep Tech, Artificial Intelligence/Machine Learning, Augmented Reality(AR)/Virtual Reality(VR), Blockchain, Metaverse, Web 3.0, FinTech, AgriTech and HealthTech. The seed accelerator program will commence on September 6 in a hybrid model and will offer participating startups support for three months.
“The program’s new cohort will be focused on providing mentorship across components like growth, product, fundraising, design, talent, market-fit, PR and more. By giving the founders access to the knowledge and networking opportunities we can help accelerate their growth to move their venture to the next level,” said MSR, CEO, T-Hub.
Rooter to host BGMI invitational eSports Tournament
Rooter, a game and eSports streaming platform will host a Battlegrounds Mobile India tournament, slated to be held from July 25 to August.
As per a company statement, the tournament will be a pathway for the teams to qualify for Rooter Pro Series Lan scheduled later in the year. 32 top Indian teams, including 24 invited teams and 8 underdog teams will face off in the 10-day tournament.
The teams will be combating each other in three phases for a prize pool worth Rs 15 lakhs.
GLOBAL TECHNOLOGY & STARTUP NEWS
China tightens data rules for online ride-hailing firms
China's transport ministry has tightened existing rules governing how online ride-hailing firms should handle and share their data with regulators, a day after Didi Global was fined $1.2 billion for illegally collecting and processing data.
The new measures are an update of similar rules announced in 2018 and give the government more control over data collected by these private companies.
Data generated by ride-hailing platforms cannot be used for commercial purposes, must be stored for at least two years in China, compared so six months previously, and it cannot be exported or shown to outside entities without regulatory authorisation.
The new rules come after the Chinese government levied $1.2 billion fine on Didi Global concluding a year-long probe that forced the ride-hailing leader to delist from New York within a year of its debut.
Amazon strikes $3.5Bn deal for One Medical in long march into US healthcare
Amazon has agreed to buy primary care provider One Medical for $3.49 billion, expanding the e-commerce giant's virtual healthcare and adding brick-and-mortar doctors' offices for the first time, Reuters reported.
The all-cash deal would combine two relatively small players as Amazon continues a years-long march into US healthcare, seeking to grow at a faster pace.
In One Medical, Amazon is acquiring a loss-making company with 767,000 members and enterprise clients such as Airbnb and Google, which offer its services as a benefit to employees, according to its website and recent financial results.
Snap Misses on second-quarter revenue, plans to slow hiring
Snapchat parent Snap posted its slowest ever quarterly sales growth as a public company on July 21.
The company reported revenues of $1.11 billion for the second quarter of 2022, registering a 13 percent growth year-over-year (YoY). Net loss also widened to $422 million for the quarter, a significant jump from $152 million loss in the same quarter last year.
The Santa Monica, California-based company said it will significantly slow hiring, invest in its advertising business and find new sources of revenue in order to grow at a faster pace.
Twitter gets fast-tracked Elon Musk trial over $44Bn deal
Twitter will get an October trial in its legal fight to hold Elon Musk to his $44 billion takeover, after a Delaware judge said on Tuesday the social media company deserved a quick resolution of the deal's uncertainty.
The ruling is a blow to Musk, who pushed for a trial in February to allow for an extensive investigation into his claims that Twitter has misrepresented the number of fake or spam accounts.
Chancellor Kathaleen McCormick of the Court of Chancery in Delaware said on Tuesday that the company deserved a swift decision on its claims. McCormick asked the parties to work out the schedule for the trial, which she said would last five days.
Russian-backed separatists in Ukraine block Google search engine
Russian-backed separatists in a breakaway region of eastern Ukraine have blocked access to the search engine Google, their leader said, citing what he calls "disinformation".
In a message posted on his Telegram channel, Denis Pushilin, head of the self-proclaimed Donetsk People's Republic (DPR), accused Google of promoting "violence against all Russians" and said that its "handlers from the U.S. government" were to blame.
"If Google stops pursuing its criminal policy and returns to the mainstream of law, morality and common sense, there will be no obstacles to its work," he said. He did not provide evidence to support his assertions.
Google to allow app developers to use rival payment systems, to cut fees
Google said it will cut fees to 12 percent, from 15 percent, for non-gaming app developers on its Google Play App Store which switch to rival payment systems, as it moves to comply with new EU tech rules, Reuters reported.
The world's most popular internet search engine said the fee cut applies only to European consumers while the freedom to use another payment system will eventually be expanded to gaming apps as well.
The move underscores a change in Google's strategy since last year where it now prefers to bow to regulatory and antitrust pressure with offers of concessions rather than embark on lengthy and distracting fights.
Modsy shuts down, lays off employees
Online interior design services startup Modsy has quietly shut operations and several customers have been left with unfinished renovations and project orders in process.
San Francisco-based Modsy has abruptly ceased offering design services, laid off its designers and left its customers in disarray, reports TechCrunch.
Neuralink co-founder departs Musk-backed startup
A founding member of Elon Musk's Neuralink left the company in recent weeks, according to two people familiar with the matter, the latest in a string of departures at the brain implant startup.
Paul Merolla, who helped launch Neuralink in 2016 and worked on its chip design program, is no longer with the San Francisco area company, the sources told Reuters.
The reason for Merolla's departure and his career plans could not be learned.
UK tribunal quashes Meta-Giphy deal block, regulator to reconsider ruling
Britain's competition regulator said it would carry out another review of Facebook owner Meta's acquisition of Giphy after a tribunal quashed its original decision to block it, Reuters reported.
Britain's Competition and Markets Authority (CMA) last year ordered Meta to sell animated images platform Giphy, which it acquired for a reported $400 million, because of its concerns about a loss of a possible competitor in advertising, and the potential impact on social media rivals.
The CAT said it had quashed the regulator's ruling and referred the matter back for a new decision. In response, the CMA said the tribunal had endorsed its approach to reviewing mergers that might harm innovation, but had agreed to reconsider its ruling.
Instagram will allow users to shop directly in chats
Instagram is getting a payment feature that will allow users to buy from small businesses through direct messages, parent company Meta Platforms said.
Users of the photo-sharing app need to message the business, add customizations if required and place the order in the chat, Meta said.
They will also be able to track the order and ask the business any follow-up questions in that same chat thread. The feature furthers Meta's push to expand its e-commerce offerings.
Meta hit with trademark lawsuit by virtual-reality company MetaX
Facebook owner Meta Platforms was hit with a trademark lawsuit in Manhattan federal court by MetaX LLC, a company that creates immersive virtual-reality experiences, for allegedly stealing its name for its pivot to the metaverse, Reuters reported.
New York-based MetaX told the court it had been "crushed" by Facebook's rebrand and said its "ability to operate as Meta has been eviscerated."
It accused Meta Platforms of infringing its federal "Meta" trademarks, and requested a court order that blocks the social media company from using "Meta" for goods and services that overlap with MetaX's as well as an unspecified amount of money damages.
Meta's Facebook revamping main feed to attract younger users
Meta Platforms said it was revamping the main feed on its Facebook app to prioritize "discovery" of new content, instead of posts from accounts users follow, in a bid to style its apps after short-form video competitor TikTok.
As per a Reuters report, Meta executives have voiced increased urgency in recent months around boosting Meta's 'reels', similar to TikTok's short video format, which has been especially popular with younger users.
'Home', Facebook's main news feed tab that users will see when they open the app will start heavily featuring popular posts from accounts that users do not follow, including reels and stories, Meta said in a statement.
Apple reaches $50M settlement over defective MacBook keyboards
Apple has agreed to pay $50 million to settle a class-action lawsuit by customers who claimed it knew and concealed that the "butterfly" keyboards on its MacBook laptop computers were prone to failure.
The proposed preliminary settlement was filed late Monday night in the federal court in San Jose, California, and requires a judge's approval, as per Reuters.
Customers claimed that MacBook, MacBook Air and MacBook Pro keyboards suffered from sticky and unresponsive keys, and that tiny amounts of dust or debris could make it difficult to type.