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STARTUP DIGEST: Here’re top stories of the week

STARTUP DIGEST: Here’re top stories of the week

STARTUP DIGEST: Here’re top stories of the week
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By Palak Agarwal  Nov 28, 2020 12:26:37 AM IST (Updated)

There were several important developments in the startup space during the week. Here are the top startup updates of the week:

There were several important developments in the startup space during the week. Here are the top startup updates of the week:

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1. Tax department rejects DPIIT proposal to extend exemptions for startups
The tax department seems to be in no mood to give any new exemptions, be it to any industry, until and unless it is seriously warranted. According to sources, in a recent discussion between the Department for Promotion of Industry and Internal Trade (DPIIT) and the revenue department, North block has rejected the proposal to extend the incorporation cut-off date for startups for tax benefits.
Startups incorporated between April 1, 2016, and April 1, 2021, are eligible for full deduction on startup profits and gains provided under Sec 80-IAC of the Income Tax Act. The DPIIT wanted the tax department to consider extending this Start-Up incorporation cut-off date by another 5 years to March 31, 2026, for 80-IAC tax benefits, as the current window is expiring from April next year.
2. Centre issues guidelines for cab aggregators, surge pricing capped at 1.5X base fare
The union road transport ministry issued guidelines for motor vehicle aggregators and has directed aggregators to cap surge price at 1.5 times the base fare.
Some of the guidelines include--Driver should receive 80 percent of fare applicable on each ride, while 20 percent will go to the aggregator. The aggregator will be allowed to charge a fare 50 percent lower than the base fare and a maximum surge pricing of 1.5 times the base fare. The base fare will be for a minimum of 3 kilometres.
3. Tata Group, BigBasket deal in final stage; Alibaba may exit
The deal between Tata Group and one of India’s largest e-grocers, Bigbasket, is in the last lap, CNBC-TV18 learns from sources. The Tata Group is set to acquire a majority stake in the e-grocer and the deal could be closed by the end of the month, sources said.
Industry watchers see the move as part of the Tata Group’s strategy to build a super app. The Tata Group’s internal M&A team is working on the deal, sources said.
Tata Group is likely to buy out Alibaba’s entire 29.1 percent stake, as well as the stakes of some other investors. The other major investors, according to data by Traxcn are Abraaj Group (16.3 percent), Ascent Capital (8.6 percent), Helion Venture Partners (7 percent), Bessemer Venture Partners (6.2 percent), Mirae Asset Naver Asia (5 percent), International Finance Corporation (4.1 percent), Sands Capital (4 percent), and CDC Group (3.5 percent).
BigBasket, Tata Group, Alibaba did not respond to queries from CNBC-TV18.
4.BYJUS: REPORTS
Two months after it raised $500 million in a financing round, edtech decacorn Byju's has reportedly closed $200 million in a fresh round of funding. As per news reports, PE players such as BlackRock and T Rowe Price participated in the new round. While BlackRock is an existing investor in Byju’s, T Rowe joined as a new investor. With this investment Byjus valuation has surged to $12 billion.
5. Google Financial Alert
Google India Private Limited, an Indian arm of Google USA that gets most of its revenue from paid advertising, reported its revenues for financial year 2019-20 as Rs 5,594 crore, a 35 percent jump since the last financial year. The company further reported a net profit of Rs 586 crore during the same fiscal. This is 24 percent increase from the last financial year. The company’s total expenses for the fiscal were reported as INR 4,455 crore.
6. Paytm, PhonePe, Amazon Pay among new NPCI shareholders
The National Payments Corporation of India (NPCI), which runs payments infrastructure such as UPI and RuPay, has onboarded leading private payments players such as PhonePe, Amazon Pay and Paytm Payments Bank as shareholders.
This week, NPCI has added 19 new shareholders, bringing the total shareholder entities to 67.
Apart from the players mentioned above, Mobikwik, PayU Payments, and Pine Labs are also among the new shareholders.
All these payments players now hold 0.44 % stake each in NPCI (Mobikwik holds 0.04%). Among the largest shareholders are public sector banks such as Bank of Baroda (9.15%), Union Bank of India (9.15%) and State Bank of India (7.12%).
7. Alia Bhatt has something new to offer, but it is not another Bollywood venture
Actress Alia Bhatt, after investing in a few startups, has started her own company called Ed-a-Mamma, a kids wear brand that caters to the age group between 2-14.
It was launched nearly six weeks back, and Bhatt says 70 percent of the first season or first batch of the collection was sold in these six weeks.
Ed-a-Mamma, which started nearly six weeks back, is currently available on FirstCry, an online platform for baby products.
8. Funding of the week
Cars24 becomes India's latest unicorn with $200 million from DST Global
Online transaction platform for pre-owned vehicles CARS24, is the latest to join the Unicorn club in India after raising over $200 million in a Series E round led by DST global with participation from existing investors including Exor Seeds, Moore Strategic Ventures and Unbound. The fresh round of funding valued CARS24 over $1 billion, making it the first startup in the auto sector to reach the unicorn valuation.
The company says that this financing will be used to strengthen the technology and product level innovation, brand building and scaling new business verticals.
Unacademy raises a new investment round from Tiger Global Management and Dragoneer Investment Group
Edtech startup Unacademy Group has raised a new investment round from Tiger Global Management and Dragoneer Investment Group. The funding round values Unacademy Group at $2 billion.
Plum raises Rs 110 crore in Series B funding led by Faering Capital
Vegan beauty brand PLum has raised Series B funding of Rs. 110 crore led by Faering Capital. Trifecta Capital has joined the round along with existing investor Unilever Ventures.
Bengaluru-based payments company Cashfree raises $35 million
Bengaluru-based payments startup Cashfree has received $35.3 million as part of its Series B raise. The investment was led by growth stage financial services investor, Apis Partners through its Growth Fund II, with participation from existing investors including Y Combinator.
Fidelity Management invests in Nykaa
Omnichannel retailer of beauty and wellness products Nykaa has raised an undisclosed investment from Boston-based asset management firm Fidelity Management & Research, the company announced on Thursday. The funding has been made through a secondary transaction that facilitated partial exit to its early investors and exit for employee ESOPs.
Country Delight secures $25M in Series C funding led by Elevation Capital
Direct-to-home food essentials brand Country Delight this week raised $25 million in its series C round of funding led by Elevation Capital with participation from scheme(s) managed by IIFL AMC, and existing investors Matrix Partners India as well as Orios Venture Partners. The company is now looking to expand beyond milk and milk products into fruits and vegetables, pulses, jams and other products.
Kaagaz Scanner raises seed funding
Document scanning and storage app Kaagaz Scanner has raised $575,000 in funding led by Pravega Ventures alongside Axilor Ventures, Better Capital and a clutch of angel investors.
Cityflo raises Rs 57 crore led by Lightbox Ventures
Cityflo, an app-based bus service has raised INR 57 crore in Series A funding led by Lightbox Ventures. India Quotient who had infused a seed amount of INR 3 crore into Cityflo in 2019 along with other angel investors has also participated in the round. The company will utilize the funds to expand services.
Accel Partners leads Rs 27 crore pre-series A round in Credgenics
Debt resolution startup Credgenics has raised Rs 27 crore (US$3.5 Million) in a pre-Series A round led by Accel Partners, DMI Alternatives fund with participation from existing investors Titan Capital besides angel investors like Kunal Shah (Founder, CRED), Dilip Khandelwal (MD & Global CIO, Deutsche Bank), Sumit Maniyar (Founder, Rupeek), Ramakanth Sharma (Co-founder, Livspace), Gaurav Agarwal (Co-founder, 1mg), Vivek (Founder, Bounce), Akhil Paul (MD, Caparo Group), Nitin Gupta (ex-Founder, PayU) and Karthik (Ubiquity Capital). Company will use the funds to enhance product development, strengthen R&D and scale the operations across India
9. Festive sales hit $8.3 billion
The e-commerce sector clocked $8.3 billion in gross merchandise value (GMV) in the festive sale period between mid-October to November , up around 65% from the previous year according to Redseer. Flipkart Group including Myntra emerged as the leader with a 66 percent share of the overall GMV clocked by e-commerce firms. This year’s festive sales also saw 88 percent customer growth from last year, as close to 40 million shoppers coming from Tier 2 and beyond cities bought on e-commerce platforms.
10. Tamil Nadu bans online gaming; Rs 5,000 fine, six months jail for violators, Karnataka could also follow the suit soon
The Tamil Nadu government has banned online gaming in the state via an ordinance that provides for banning the electronic transfer of funds used for wagering and betting, distributing the winnings, prize money. It also provides for punishing the persons who are running the company which conducts online gaming by wagering and betting. According to reports, Karnataka is also set to impose a ban on online games
11. WhiteHat Jr v/s CRITICS
A day after edtech startup WhitehatJr got an interim injunction against critic Pardeep Poonia form the Delhi HC, the company on Tuesday got interim relief in a defamation case filed by it against another critic Anirudh Malpani, who is an angel investor, which refrains the latter from publishing or sharing any content derogatory against WhiteHatJr.
12. UpGrad acquires The Gate Academy
Online higher education company upGrad has made a 100 percent acquisition of coaching institute The Gate Academy (TGA) to foray into the test preparation market.
Post acquisition, TGA will operate as a subsidiary of upGrad and will continue with its brand name. Ritesh Raushan will pursue as the CEO of the entity to build this business line, with all the support from upGrad, who will be providing its proprietary online learning solution and tools for enhancing the learning experience, as well as its sales, marketing, and content prowess.
The edtech startup also plans to invest over Rs 100 crore into this test preparation subsidiary and will be developing over 20,000 hours of content in multiple languages to provide access to at least one million test-takers annually.
13. Chinese app blocked by India
This week the Narendra Modi government has blocked around 90 Chinese mobile apps under section 69A of the Information Technology Act for engaging in activities which are prejudicial to sovereignty and integrity of India.
List of apps that have been blocked for access in India includes AliSuppliers Mobile App, Alibaba Workbench, AliExpress - Smarter Shopping, Better Living, Alipay Cashier, Lalamove India - Delivery App, Drive with Lalamove India, Snack Video, CamCard - Business Card Reader 9, #MiVideo, Clash Of Queensand, among others.
14. Amazon fined over ‘Country of Origin’ rules violation, Flipkart spared
Amazon has been fined by the Consumer Affairs Department over noncompliance with the display of 'Country of Origin' on packaged products sold on its platform, government sources said.
As a first offence, Amazon has to pay a fine of Rs 25,000 within a week of receiving the notice, which was issued on Friday, as per sources. Under the Legal Metrology Act, the fine for a second offence is Rs 50000, while subsequent offences could lead to jail term.
15. UK's competition regulator looking at formal investigation into Google
UK’s competition regulator the CMA says it has received a complaint about Google related to its market study on online platforms and digital advertising earlier in 2020. “If the urgency of the concerns requires us to intervene swiftly, we will also assess whether to impose interim measures to order the suspension of any suspected anti-competitive conduct pending the outcome of a full investigation, the CMA said in a statement”
16. Britain to curb Google and Facebook with tougher competition rules
Britain will impose a new competition regime next year to prevent Google and Facebook using their dominance to push out smaller firms and disadvantage consumers.
The code will be enforced by a dedicated unit within the Competition and Markets Authority. Google and Facebook dominate digital advertising, accounting for around 80 percent of 14 billion pounds spent in 2019, Britain’s competition regulator the CMA said.
17. France orders tech giants to pay digital tax
France’s finance ministry has sent out notices to big tech companies liable for its digital service tax to pay the levy as planned in December. France suspended collection of the tax, which will hit companies like Facebook and Amazon, early this year while negotiations were underway at the Organisation for Economic Cooperation and Development (OECD) on an overhaul of international tax rules.
18. Elon Musk & Tesla: In News
Elon Musk becomes world's second richest person
Tech entrepreneur Elon Musk has topped Microsoft founder Bill Gates to become the world's second richest man after a meteoric rise in his personal fortune. Musk's net worth jumped by $7.2bn to $128bn after shares in his car firm Tesla
Tesla plans to produce electric car chargers in China
Tesla Inc is planning to start making electric vehicle (EV) chargers in China in 2021, part of the U.S. carmaker’s push to boost sales in the world’s biggest car market. Tesla, which now sells its Model 3 electric cars in China and plans to deliver its Model Y sport utility vehicles in 2021, plans to invest 42 million yuan ($6.4 million) in a new factory to make its third generation of quick chargers, known as the Supercharger V3, it said in a statement. The factory will be near its car plant in Shanghai.
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