There were several important developments in the startup space during the day on Monday. Here are the top stories that made headlines in the startup universe.
IPO-bound Paytm, HDFC Bank in strategic partnership to launch fintech services
With an aim to strengthen its financial services offering ahead of an initial public offering, Paytm has announced a strategic partnership with HDFC Bank for delivering financial solutions to end consumers and merchants across India.
Through this tie-up, the two companies aim to build comprehensive solutions across payment gateway POS machines and credit products including Paytm postpaid, which is Buy Now Pay Later (BNPL) solution, Eazy EMI and Flexi Pay, and more.
The first leg of the partnership will include Payment Gateway and POS solutions for Indian merchant partners. The partnership between Paytm and HDFC Bank will aim to empower the new businesses, which have recently ventured online, and enable them to scale up further, the company said.
Delhi court gives police three weeks to conclude Paytm ownership probe
A Delhi court has given police three weeks to conclude an investigation into claims from a former Paytm director Ashok Kumar Saxena, who said that he co-founded the digital payments company but did not receive shares owed, as per a Reuters report.
Saxena in legal documents said he invested $27,500 two decades ago in Paytm parent One97 Communications but was never allotted any stock, Reuters reported this month.
Paytm has said the claim amounts to harassment and cited it under "criminal proceedings" in the prospectus for its proposed $2.2 billion IPO. Saxena, a director from 2000 to 2004, has written to the market regulator urging it to stop Paytm from proceeding with the IPO.
On Monday, a Delhi district court judge asked for the final report of the police investigation within three weeks. The police has submitted a status report to the court but is yet to conclude the investigation, senior lawyer Anupam Lal Das, representing Saxena, told Reuters after the hearing.
Corporate governance experts said the tussle could spark regulatory inquiries and complicate the approval of an IPO that could value Paytm at up to $25 billion.
The heart of the dispute is a document seen by Reuters, dated 2001, and signed by Saxena and current Paytm chief executive Vijay Shekhar Sharma, stating Saxena was to own 55 percent of One97 Communications with Sharma owning the remainder.
Paytm, in a response to a police notice and which was seen by Reuters, denied Saxena was a co-founder and said the document in question was "merely a letter of intent" which "did not materialise into any definitive agreement. The case will next be heard on September 13.
Locus partners with PostTag in a bid to disrupt the global logistics market
Logistics startup Locus has partnered with UK-based PostTag, an address lookup and validation service, to create an end-to-end technology solution for deliveries.
Under this partnership, the companies will provide customers with an end-to-end tailored logistics optimisation solution to automate the supply chain process from the moment the customer places an order on a website till the time the delivery is fulfilled with efficient warehousing and route planning, fleet management, last-mile visibility, and more.
According to the company, last-mile delivery is one of the critical phases in the supply chain, accounting for 50 percent of the delivery cost, and is core to ensuring customer satisfaction.
The firm claimed that this partnership will ensure not only a more efficient supply chain but drivers that get straight to the address the first time, without wasting valuable time and fuel. PostTag's Destination Data Engine returns precise details for each address search. It checks, validates, and verifies addresses across multiple databases, telling the driver precisely where the home or business is.
“Companies are still dependent on legacy solutions that aren't equipped to handle today's real-world supply chain and logistics operations. The partnership of Locus and PostTag is set to change that, and we are excited about the opportunities we see for growth in the APAC region," said Nishith Rastogi, co-founder and CEO, Locus.
Euler Motors bags order for 2,500 units from e-commerce players
Electric vehicle maker Euler Motors said it has bagged a total order for 2,500 units of its upcoming electric three-wheeler cargo carrier from e-commerce players, including BigBasket and Udaan.
It also includes orders from hyperlocal and B2B delivery players for intra-city deliveries.
“The exponential growth in consumer acceptance of online deliveries, BigBasket is dedicated to electric mobility and is committed to delivering smooth supply chains and enabling sustainable mobility,” said Hari Menon, co-founder, BigBasket.
Expressing similar views, Udaan co-founder Sujeet Kumar said, "The full-stack approach that Euler Motors has taken to help companies transition to electric mobility has given us a lot of comfort in day-to-day operations of our fleet."
As per the EV maker, the companies will deploy Euler Motors EV (electric vehicles) across Delhi-NCR, Bengaluru, Hyderabad and Chennai. Deliveries of these vehicles are scheduled to take place in the next 6-8 months, it added.
The New Delhi-based firm is expected to launch its first three-wheeler cargo vehicle next quarter in the middle of the festive season.
Currently, the company said it is plying over 300 vehicles as part of a pre-launch pilot with ecommerce, FMCG companies for intra-city delivery in Delhi-NCR.
Euler Motors Founder and CEO Saurav Kumar said, "We will soon focus on expanding our capacity and footprint to better meet our customers in more locations and in scale expectations."
Founded in 2018, Euler Motors is an automotive OEM focused on electric commercial vehicles. It also manages a network of over 100 charging infrastructure in Delhi NCR to support EVs on ground.
Portea Medical appoints founder Meena Ganesh as chairperson
Home healthcare provider Portea Medical has announced the appointment of its founder Meena Ganesh as the chairperson of the company to further synergise and streamline its operations in the new normal.
The company has also appointed Vaibhav Tewari as chief executive officer (CEO).
"The new appointments have been made with an aim to further synergise and streamline Portea's operations in the new normal, and efficiently activate the 2023 growth strategy of the organisation," the company said.
In her new capacity, Meena will look after strategy, merger and acquisitions, driving advocacy and relationships with stakeholders such as institutional partners, government bodies, investors and the external communication, the firm added.
Meanwhile, Vaibhav will be working on company growth, strategy rollout, building business and deploying technologies.
The company has already introduced services such as dialysis and cancer care at home, and now is all set to strive ahead by expanding its footprint across the country. It also plans to strengthen its remote monitoring teams and technology, create hybrid offerings that use technology and on-ground presence.
Nirmata appoints Nataraj Narayan as managing director
Software solutions provider Nirmata has appointed Nataraj Narayan as the Managing Director for Nirmata in India.
“With a stellar career as a senior executive at multiple companies such as Hexaware, Mindtree, Wipro, KPIT, and most recently at Sauce Labs (AIQ), Nataraj brings three decades of industry experience, having successfully launched and scaled technology businesses”, the company said.
The appointment comes at a time when Nirmata is in the process of hiring the leadership team and plans to more than double the team in India in the next six months.
The startup has recently raised $4 million in pre-Series A funding led by Z5 Capital with participation from Uncorrelated Ventures, Samsung Next, Banhamou Global (BGV) and angel investors.
Anant Goel resigns from Milkbasket as two RIL executives join board post acquisition
Anant Goel, the cofounder and CEO of subscription-based hyperlocal grocery delivery platform Milkbasket, has resigned from the board and CEO post as two senior executives of Reliance Industries (RIL) have joined the board after acquisition of the company.
According to an Economic Times report, Nikhil K Chakrapani and Rajendra Kamath have joined as additional directors on Milkbasket board, effective July 19 and Goel resigned on the same day, according to regulatory filings accessed by the financial daily.
According to an ET report in May, RIL was in the final stages of acquiring Milkbasket to bolster its e-commerce play. RIL’s JioMart has been testing subscription-based deliveries of essentials in select markets such as Chennai and Bengaluru.
Besides Milkbasket, RIL acquired startups such as Urban Ladder and e-pharmacy Netmeds last year.
Govt to decide on cryptocurrency bill in next Parl session
The Centre is expected to take up the bill to regulate cryptocurrency in the next parliament session.
Government officials told CNBC-TV18 that crypto issue needs to be thought through from all angels. They added that government can’t end up doing something where good also gets harmed.
The cryptocurrency bill's primary aim is to create an official digital currency issued by the Reserve Bank of India. The bill seeks to prohibit all private cryptocurrencies in India.
Earlier in May, finance minister had said that a very calibrated position will be taken on crypto and digital currency as the world is moving rapidly with technology. There have been reports that bitcoin and other cryptocurrencies may be allowed as an asset class in India.
However, the central government will not accept cryptocurrency as legal tender any time soon. The Centre has reiterated time and again that it does not consider cryptocurrencies legal tender or coin.
In April 2018, the Reserve Bank of India (RBI) had “advised all the entities regulated by it not to deal in" digital currencies. Later in 2020, the Supreme Court set aside the central bank’s 2018 circular and allowed banks and financial institutions from providing services related to cryptocurrencies. RBI had announced in May, 2021 that banks would be permitted to facilitate cryptocurrency trades after Supreme Court ruling.
Bitcoin tops $50K, hitting more than 3-month high
Bitcoin hit $50,000 on Sunday to reach a more than 3-month high, as the cryptocurrency continues to rebound.
The digital coin rose above that level around 10:40 pm on Sunday, according to data from CoinDesk. It was trading at around $50,263 at 6:20 am on Monday.
Bitcoin hit an all-time high over $64,000 in April but sold off heavily in June and July, even dipping below $30,000. One of the major reasons was renewed regulatory scrutiny from Chinese authorities which has forced bitcoin mining operations to shut down and move elsewhere. But since mid-July, bitcoin has been on a steady rise.
The value of the entire cryptocurrency market stood above $2.16 trillion on Sunday, according to data from Coinmarketcap. It crossed the $2 trillion mark for the first time since May earlier this month.
GLOBAL TECHNOLOGY & NEWS
PayPal launches its cryptocurrency service in the UK
PayPal is launching its cryptocurrency service in the UK, CNBC reported.
The US online payments giant said Monday it would let British customers buy, hold and sell digital currencies, starting this week.
It marks the first international expansion of PayPal’s crypto product, which first launched in the US in October last year.
“It has been doing really well in the US,” Jose Fernandez da Ponte, PayPal’s general manager for blockchain, crypto and digital currencies, told CNBC.
“We expect it’s going to do well in the UK,” Ponte added.
PayPal’s crypto feature lets customers buy or sell bitcoin, bitcoin cash, ethereum or litecoin with as little as £1. Users can also track crypto prices in real-time, and find educational content on the market.
Like the US version of the product, PayPal is relying on Paxos, a New York-regulated digital currency company, to enable crypto buying and selling in the UK. PayPal said it has engaged with relevant UK regulators to launch the service.
DoorDash talks to invest in grocery startup Gorillas end
DoorDash, the largest food delivery company in the US, has ended talks to invest in Gorillas Technologies after disagreements with the German delivery startup over expansion plans, Bloomberg News reported.
The San Francisco-based company was discussing investing $400 million in a deal that would have valued the startup at $2.5 billion, the person said. The news was reported earlier by The Telegraph.
A letter of intent had been signed by both parties but the two sides couldn’t agree on a strategy. DoorDash wanted Gorillas to slow its expansion in the U.S. and focus on reducing its losses on the European operation, the report claims.
Gorillas is one of the most high-profile startups in the business of delivering groceries and other goods within minutes, an industry that has boomed during the pandemic lockdowns and attracted billions of dollars from venture capitalists. The company has been trying to raise new funds as it expands.
Founded last year, Gorillas raised about $300 million in its most recent funding round in March from investors including DST Global, Coatue Management and Tencent Holdings Ltd., boosting its valuation to just over $1 billion, according to data from Pitchbook.
'Black Widow' helps Disney collect $125 mn in online revenue
Walt Disney said in a court filing on Friday that it has garnered $125 million in online revenue from the Marvel superhero film "Black Widow", three weeks after getting sued by its star Scarlett Johansson.
As per Reuters, the actress last month sued Disney alleging that the company breached her contract when it offered the movie on streaming at the same time it played in theaters.
The entertainment company, in the filing, has countered Johansson's request for a civil trial in Los Angeles by asking for the suit to be sent to arbitration in New York.
Johansson's suit, filed in Los Angeles Superior Court, argued that the dual release strategy of "Black Widow" had reduced her compensation.
Disney had said there was "no merit" to the lawsuit, adding that online release of the film "significantly enhanced her (Johansson's) ability to earn additional compensation on top of the $20 million she has received to date.”
The outcome of the suit could have wider ramifications in the entertainment industry as media companies try to build their streaming services by offering premium programming to attract subscribers.
San Francisco-based DoorDash is expanding internationally and has looked into the possibility of acquisitions in Europe, as per the report.
Facebook-Giphy deal puts antitrust focus back on stealth M&A
Facebook’s $400-million acquisition of image library Giphy was targeted in a new antitrust complaint filed by the US Federal Trade Commission, according to Bloomberg News.
The commission said that Facebook has illegally maintained a monopoly in social media by buying companies it sees as competitive threats.
A House report last year recommended that dominant platforms like Facebook be required to notify enforcers about all their deals. However, the social media giant bought the company and closed the deal without notifying competition regulators.
During a House investigation of Facebook and other tech platforms, Representative David Cicilline, the Rhode Island Democrat who led the probe as chairman of the House antitrust panel, asked Facebook why the Giphy deal wasn’t reported under merger notification laws. Facebook responded it wasn’t required to, without explaining.
Facebook said it disagreed with the regulator’s findings and said the deal was in the interest of people and businesses in the UK and around the world.
The review is ongoing, according to the commission.
Facebook is now in danger of being forced to sell Giphy. The UK’s antitrust watchdog has provisionally determined that the acquisition threatens competition in social media and display advertising. The Competition and Markets Authority said the only way to address its concerns is for Facebook to sell Giphy. The CMA plans to issue its final report in October.
60% Gen Z and 20% baby boomers in APAC spend more than nine hours online: UserTesting research
Massive disparity has come to light in online activities between baby boomers and Gen Z’s in Asia Pacific countries (APAC), the UK and the US, according to a
report by UserTesting.
60 percent of Gen Z’s in APAC stated that they spend nine hours or more online every day, while 60 percent of them in the UK claimed an average of eight hours. In the U.S, only 50 per cent of Gen Z’ers spend an average of six hours online daily.
For the Baby Boomers in the APAC region, 30 percent spend six hours online, and 20 percent noted they spend more than 10 hours online, while in the UK, 60 percent of Baby Boomers spend only four hours per day online.
Meanwhile, in the U.S, it was found that the screen time spent by Baby Boomers compared to Gen Z’s wasn’t that different; 50 percent of baby boomers spend an average of four hours online daily.
The study also found that Amazon was the most referenced app among both generations across APAC, US and UK. Other popular choices included Flipkart, eBay, ASOS, Etsy, Grubhub, Nike, Postmates, and Uber Eats to name a few.
First Published: IST