Here are the top headlines from the startup space.
Temasek backs probe into Zilingo's accounting practices
Singapore state investment firm Temasek has backed an investigation into fashion technology startup Zilingo Pte's accounting practices saying it supports the company board's move.
In a strongly-worded statement, Temasek said, "We expect our portfolio companies to abide by the sound corporate governance and codes of conduct and ethics. We are, therefore, in support of the board's investigation into the complaint as a part of good governance to safeguard the interests of the company." However, it did not elaborate on the investigation.
This is the second investment firm that has spoken in the favour of strong governance framework days after Sequoia India, also an investor in Zilingo, spoke on the subject. The statement comes after the board of Zilingo put its founder Ankiti Bose on suspension on March 31 pending an investigation.
Sequoia Capital India's Shailendra Singh too has stepped down from the board of Zilingo following questioning over accounting practices of the fashion technology startup, sources said. Zilingo, a platform for fashion merchants backed by Singaporean state-owned investor Temasek Holdings, was co-founded in 2015 by CEO Ankiti Bose alongside Dhruv Kapoor, its chief technology and chief product officer.
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Singh resigned as a director a few days back after the departure of Temasek Holding Pet's Xu Wei Yang and Burda Principal Investments’ Albert Shyy, the sources said. The investigation reportedly is into the way that Zilingo had accounted for transactions and revenue across a platform spanning thousands of small merchants.
Besides Temasek and venture capital firm Sequoia Capital, Zilingo also counts Burda Principal as well as Singapore's Economic Development Board's investment arm EDBI among its investors. It was not immediately clear how much share each investor holds in the company.
SpiceJet promoter Ajay Singh invests in healthcare startup Flebo
SpiceJet promoter Ajay Singh has in his personal capacity invested in healthcare startup Flebo which provides sample collection services to medical diagnostic labs, a statement said.
"Labs need not hire their own individual home collection agents anymore. Flebo allows impaneled labs to expand their reach to customers beyond their immediate local area," the company press release mentioned.
Flebo team includes more than 100 trained, well-qualified and customer-centric in-house phlebotomists for home collection of blood and other samples and now is being ramped up to several thousand.
Flipkart acquires ANS Commerce: Reports
Flipkart has acquired ANS Commerce, a full-stack e-commerce enabler that helps brands sell online, as per reports. Through this acquisition, Flipkart would continue its efforts to strengthen the e-commerce ecosystem in the country. The deal is expected to close in the second half of 2022, subject to “customary closing conditions", reports added.
Founded in 2017, ANS provides various services to companies and brands looking to sell online. These include services that help brands set up digital storefronts, integration with marketplaces like Flipkart and Amazon, and warehousing and facilities maintenance services.
Whatfix acquires Leap to expand mobile capabilities
Whatfix, digital adoption platform (DAP) has acquired Leap, a mobile-first onboarding and assistance platform that caters to digital adoption platforms for mobile applications. The deal marks Whatfix's first mobile DAP product-focused acquisition, as well as its largest M&A deal so far.
The acquisition will augment the company's platform by extending Whatfix's mobile capabilities. Leap's toolset will integrate with Whatfix's existing applications by adding guidance to mobile apps to improve activations and adoption, reduce time-to-ship for onboarding experiences, and increase the customization of user experiences overall.
Whatfix has marked 76 percent YoY revenue growth in the fiscal year 2022 and an 85 percent increase in new business revenue. The company has reported a 250 percent increase in revenue from existing business.
The digital adoption platform also launched Whatfix Studio and is also introducing a revamp to its Desktop offering. Additionally, the company is launching the Whatfix Hub - a centralized platform for user support and engagement.
Mamaearth selects MoEngage as strategic partner to enhance customer engagement
Baby and mother care brand Mamaearth has selected MoEngage to help enhance engagement across the customer’s digital buying journey and provide personalised experiences across all touchpoints.
"We’re thrilled to be a part of Mamaearth’s amazing growth journey. We aim to continue providing the team with deeper insights into customer behavior, in turn ensuring Mamaearth customers get a delightful experience while shopping with the personal care brand. We look forward to this partnership and wish to scale together with Mamaearth," said Yash Reddy, Chief Business Officer (APAC & EMEA), MoEngage.
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Former Avtec CEO Prabhakar Kadapa joins EV-maker Etrio’s board
EV-maker Etrio Automobiles has announced that Prabhakar Kadapa, a veteran automotive leader with over 39 years of industry experience, has joined its Board of Directors. Most recently, Kadapa served as the CEO & Managing Director of PSA AVTEC Powertrain.
"I am looking forward to helping Etrio launch a series of cutting-edge next-gen electric cargo vehicles and supporting strategic organizational development as electric vehicle volumes pick up in numbers,” said Kadapa.
Indian SaaS industry to reach $100 billion in revenues by 2026: Chiratae Ventures & Zinnov Report
The Indian Software as a service (SaaS) industry is set to clock in $100 billion in revenues by 2026, according to a joint report by venture capital firm Chiratae Ventures and consultancy firm Zinnov. Venture capital investments in the sector grew three-fold in 2021 to over $4 billion and it is expected to grow by 55 percent to touch $6.5 billion over the next year, the report added.
"2021 was a watershed year for Indian SaaS – including exponential valuations, successful IPO debuts, a vast influx of VC (venture capital) investments, and an unprecedented number of unicorns," said Pari Natarajan, Chief Executive Officer of Zinnov.
"On the path of crossing the milestone of $100 billion in revenue by 2026, India is fast emerging as a clear leader in SaaS, and will supersede China to become the second-largest SaaS nation in the next few years," added Natarajan.
As per the report, about 90 percent of all SaaS unicorns have achieved the status in the last four years and there are currently more than 1,150 active companies, with a cumulative revenue of $8 billion in 2021. About 40 percent of the revenue is coming from the enterprise segment, making profitability a "realistic milestone for SaaS companies", it claimed.
Globally, India recently surpassed the United Kingdom in the number of SaaS unicorns and is gearing up to surpass China to become the second-largest SaaS nation by 2026, the report said.
"India is a global SaaS leader, and Chiratae Ventures has been fortunate to be at the center of this surging momentum, with over 35 SaaS companies in our portfolio like Uniphore, which recently raised $400 million, and others like Pixis, Hevo Data, Healthplix, CropIn, Pando, Deepfence, and Squadcast which are valued over $3.5 billion and last year overall raised $600 million," said Sudhir Sethi, Founder and Chairman of Chiratae Ventures.
GLOBAL TECHNOLOY & STARTUP NEWS
Twitter co-founder Dorsey takes aim at board in series of tweets
Twitter co-founder Jack Dorsey took aim at the social media company's board in a series of tweets as it weighs Elon Musk's $43 billion takeover offer. Dorsey, who is also a Twitter board member, added to the chatter on the micro-blogging platform last week when he said that Twitter's board has "consistently been the dysfunction of the company."
In response, a tweet on Monday asking him why he did not "do anything about it" when he was the CEO of Twitter, Dorsey expressed frustration at his limited ability to speak freely. "So much to say … but nothing that can be said," Dorsey tweeted.
Dorsey's tweets come after two weeks of upheaval at the social media company that started with Musk disclosing a 9.2% stake and then making a buyout offer. On Friday, the board adopted a "poison pill" to limit Musk's ability to raise his stake in the company.
"I really wish I could break through all the abstraction here and answer you but alas and woe," Dorsey tweeted in reply to another thread urging him to share his thoughts.
Tesla CEO Musk has been vocal in his criticism of Twitter's strategies and its board. He tweeted on Monday that the salary of Twitter's board members would be $0 if his bid succeeds, resulting in $3 million being saved every year.
Other potential buyers, including private equity firm Thoma Bravo, are also considering buyout bids for Twitter, according to reports.
Meta institutional investors urge opposing re-election of two board members
A group representing some of Meta Platforms’ institutional investors urged shareholders of the Facebook owner to vote against the re-election of two of its board members, Marc Andreessen and Peggy Alford.
"We believe the lack of independence of board members Peggy Alford and Marc L. Andreessen is undermining the board's ability to adequately oversee the management team and represent shareholders' best interests," said Shareholder Association for Research and Education (SHARE) in a filing seen by Reuters.
The group of 15 shareholders, including SHARE, the Illinois State Treasurer and Arjuna Capital, instead urged the nomination of new, highly-qualified independent directors, according to the filing. Peggy Alford, an executive at PayPal, joined Meta's board in 2019, whereas venture capitalist Marc Andreessen has served on the company's board since June 2008.
The shareholders also urged the board to implement certain governance reforms, including eliminating the dual-class structure and separating the functions of the chief executive officer and chairman. SHARE added that Meta's board did not respond to discuss these matters.
Deliveroo found guilty of abusing riders' rights in France
Two former bosses of Deliveroo were given suspended one-year prison sentences and fined 30,000 euros ($32,380) by a French court on Tuesday for abusing the freelance status of riders working for the British takeaway delivery platform.
As per Reuters, the company was also fined the maximum penalty of 375,000 euros and will have to publish the court decision on Deliveroo's French home page for one month. The ruling may reverberate outside France as the gig economy, built largely upon digital apps and self-employed workers, faces a number of court challenges that may redefine working conditions.
The administrative investigation, which reviewed a period extending from 2015 to 2017, and the following court hearings showed that Deliveroo had imposed almost permanent surveillance and control over riders' work while they were connected, the judge Sylvie Daunis said.
That included allocating riders long time slots to be sure Deliveroo had as many people at hand as possible during the weekend, and telling drivers who refused that they would not be allowed to work for the platform the following weeks, for instance.
Even though the riders were freelance, the court also found that Deliveroo unilaterally changed the criteria under which pay increases were defined or the minimum time needed to be online to qualify as a rider. "This set of elements characterizes a situation of almost permanent legal subordination," Daunis said, referring to a key element that defines the employee status in France.
Deliveroo said in a statement that it "categorically contests" the French court's ruling and was considering whether to appeal. It will maintain operations in the French market, it added. Its statement said the court decision referred to an early version of its operating model and had no consequences for the way it operates today.
Amazon workers in small New Jersey facility file for union election
Amazon workers at a small facility in New Jersey have shown enough interest to hold a vote on unionizing, the US National Labor Relations Board (NLRB) said on Monday.
At least 60 of 200 workers from Amazon's DNK5 depot in Bayonne, New Jersey, have submitted cards seeking to organize as part of Local 713 International Brotherhood of the Trade Union, the NLRB said. As per Reuters, the news follows growing interest in organizing at Amazon, which for years had resisted unions in its US operations.
Just last month, thousands of employees at the JFK8 warehouse in Staten Island voted to organize under a different group known as the Amazon Labor Union, and workers at a second Staten Island warehouse are weighing later this month whether to unionize. The election date and terms have yet to be agreed upon for the delivery station DNK5. Amazon could dispute the validity of this latest petition.
First Published: IST