Another week, another set of speculations, investments, announcements and collaborations! Catch all the latest news of the past week in our quick weekly wrap up!
1. ALIBABA MAKES OUT LIKE THE 40 THIEVES FOR SINGLE’S DAY!
China’s biggest ecommerce startup Alibaba broke all records during its annual Singles Day Sale! The company reported a Gross Merchandise Volume (GMV) of $ 25.4 billion in 24 hours and became the leading online shopping platform. The sales hit the roof within the first two hours, reaching $ 16 billion by mid morning. First launched in 2009 as a way to celebrate the lonely hearts of China, Single’s Day has become a buying frenzy that exceeds the combined sales for Black Friday and Cyber Monday in the United States.
2. UBER CONFIRMS BILLION DOLLAR DEAL WITH SOFTBANK
The multi million dollar deal between taxi hailing startup Uber and Japan based venture capital firm SoftBank was finally confirmed this week. The investment giant along with Dragoneer Investment Group will invest close to $ 10 billion in the cab aggregator in the coming months. This consortium will invest up to $ 1.25 billion in the company and would also buy up to 17% of the existing shares from investors and employees in a secondary transaction. As a part of the transaction, Uber will also undergo a variety of changes in governance and leadership.
3. ACCEL PARTNERS TO INVEST RS. 100 CRORES IN UNIVERSAL SPORTSBIZ
The celebrity fashion firm backed by cricketing legend Sachin Tendulkar, Universal Sportsbiz, raised Rs. 100 crores from US based venture capital firm Accel Partners. The venture capital firm will pick up a 15 % stake in the company. Founded in 2012 by former national level badminton player Anjana Reddy, Universal Sportsbiz is currently valued at Rs. 650 crores. Both the companies have already signed an agreement, while a formal announcement is expected soon. The fashion retail startup will use the fresh funds to develop their products and expand their presence across smaller cities in India.
4. UBER POLICY CHIEF FOR INDIA AND SOUTH ASIA QUITS
Shweta Rajpal Kohli, Uber’s Chief of Policy for India and South Asia, put down her papers last week to join the cloud based software maker Salesforce.com Inc. Kohli was responsible for building Uber’s relations with the regulators and the government officials of India to expand its business in the country. Her resignation, however, might be a step back for Uber as Kohli was leading government engagements in the influential circles. The company is faced with multiple resignations including the European Policy Chief Christopher Burghardt.
5. T-HUB AND UNITED TECHNOLOGIES LAUNCH NANOACCELERATE PROGRAMME
Hyderabad based startup engine T-Hub in association with United Technologies Corporation launched the NanoAccelerate programme for startups working on video analytical solutions. The Smart City/Smart Building NanoAccelerate Programme has already selected five video analytics startups for its first cohort out of which two are from India, one is from Israel and the remaining two are from US. The selected startups have strong technical and research teams, hold more than 20 granted and pending patents and provide services to Fortune 100 companies. The startups will have the opportunity to work closely with UTC to provide seamless actionable intelligence data with minimal human intervention.
6. AMAZON INDIA PUMPS RS. 2,900 CRORES IN INDIAN MARKETPLACE
The Seattle based ecommerce giant Amazon has been placing heavy bets in the India marketplace. Confirming its commitment to developing its presence in India, Amazon will be investing Rs. 2,900 crores in Amazon Seller Services, which runs Amazon’s Indian ecommerce business. This is Amazon’s third investment in the Indian ecosystem and the single biggest infusion of capital. The company invested Rs. 1,680 crores in India in June this year and further invested Rs. 1,620 crores in September. After making an initial commitment to investing $ 2 billion in their Indian business, Amazon’s founder and CEO Jeff Bezos further promised to invest $ 3 billion in 2016. This round of investments comes despite Amazon recording a high loss in its international business this year.
7. ZOMATO LAUNCHES ZOMATO GOLD TO BATTLE SWIGGY’S ACCESS
The Indian foodtech industry is estimated to have a Gross Merchandise Value (GMV) of $ 300 million. In an attempt to grab a majority of this lucrative industry, foodtech startups Zomato and Swiggy have been locked in a fierce battle. Swiggy launched the Swiggy Access initiative which allows its restaurant partners to set up kitchen spaces in neighborhoods where they currently do not operate. Zomato, on the other hand, launched its international paid subscription programme, Zomato Gold, which is an exclusive dine out and social drinking membership programme. While Swiggy users will get faster delivery, Zomato users will get access to complimentary food and drinks.
8. FLIPKART TO INVEST IN SWIGGY?
The biggest ecommerce startup to come out of India, Flipkart, is reportedly looking to invest in the online food delivery platform Swiggy. Along with China based venture capital firm Tencent, the companies are discussing a potential investment of $ 100 million. While there has been no official confirmation, this news comes at a time when reports suggest Flipkart initiated investment talks with a bunch of vertical ecommerce startups. Flipkart’s investment in Swiggy will give the foodtech startup the leverage to gain the upper hand in the online food and services market.
9. PAYTM TO COLLAB WITH ICICI FOR DIGITAL CREDIT
India’s biggest mobile wallet Paytm is collaborating with India’s leading private bank ICICI Bank to provide digital credit to selected users. This unique amalgamation of financial services aims to provide seamless interest free short term digital credit for everyday use, such as bill payments, booking flight tickets and buying physical goods. Based on the Big Data algorithm by ICICI Bank, the credit will be decided on the basis of the financial and digital behavior of the customer. Users can avail this digital credit ranging between Rs. 3,000 to Rs. 10,000 for up to 45 days. Once the consumer limit is set, a consolidated bill would be generated on the first day of the month that should be repaid by the 15th day of the same month.
10. MYNTRA TO LEVERAGE KIRANA STORES FOR DELIVERIES
The fashion ecommerce startup owned by Flipkart is leveraging neighborhood kirana stores for last minute deliveries and to reduce the delivery time by 25%. Under its MENSA Network scheme, 2,000 kirana stores and other small shops, are responsible for the delivery of one in every five orders. These corner stores complete close to 23% of the Myntra’s nonsale deliveries. To further boost its delivery system and business, the company also launched the ‘Project Mass.’ Under this programme, Myntra’s delivery staff can start their own businesses and shops and add to the Mensa Network. These businesses will also be provided with a seed investment of Rs. 40,000 by Myntra. So far, over 370 of the companies delivery associates opted for Project Mass out of which 250 stores are already operational.
11. UBER INDIA LAUNCHES FOUR NEW BASIC FEATURES
One of the most valuable startup companies, Uber, launched four new features for the Indian market in an attempt to entice more users. Aimed at making the taxi booking process easy and hassle free, the new features include a website version of Uber, an option to request to book rides for a guest, offline search for those with limited connectivity and a call to ride feature. While the features will be released only in India initially, they will also be applied in Uber’s global markets soon. The company also launched a second engineering facility to work on innovations that can be applied to Indian as well as other global markets, in Hyderabad recently. The 150 member Indian team played a key role in developing the pieces of innovation.
12. GLOBAL ENTREPRENEURSHIP SUMMIT INDIA 2017
Hyderabad is gearing up for the eight edition of the Global Entrepreneurship Summit. GES 2017 will be hosted by the United States of America along with the Republic of India. With the theme Women First, Prosperity for All, this year’s summit will see Ivanka Trump leading the US delegation. With close to 1400 participating startups and 300 other dignitaries, GES aims at creating an environment that empowers innovators and entrepreneurs and fostering economic growth globally. Along with sessions, master classes and workshops by global experts, the summit will also hold networking events and keynote speeches from prominent entrepreneurs.
13. Ola And Uber: Boon Or Bane?
Ola and Uber may be the country’s largest gift to transport woes. However, in the past, there have been more people with complaints than people with happy faces. From various sources, the information proved only the obvious. Despite there being a large number of service providers and customer care facilities available at both Ola and Uber, it comes as a shock for people when these service providers offer sub par and negligent service. With a comprehensive study, this piece aims at uncovering the loopholes surrounding Ola and Uber!
That’s all for this week! Subscribe to our portal to never miss updates from the startup world! If your startup has an exciting announcement coming up, you can even write to us at [email protected]. Catch up with the highlights of the week with our The News This Week section.
Leher Versus Clubhouse: Which Audio Listening Startup Would You Choose?
Clubhouse is a new type of social networking platform which is an audio only platform. This means every conversation takes place through audio where users speak to let their thoughts known. Users can create and host rooms where speakers will talk about a particular topic. Originating in the Silicon Valley, Clubhouse attracted some major names onto its platform like Elon Musk, Evan Williams, Reddit co founder Alexis Ohanian, former Y Combinator President Sam Altman, AngelList co founder Naval Ravikant, Ashton Kuthcer, Oprah Winfrey, Drake, Kevin Hart and many others are some of the influential personalities who are on Clubhouse. There is however a catch as Clubhouse is currently limited to iOS.
Leher is an Indian made alternative to Clubhouse and is a similar audio sharing and listening startup. Leher also has video support unlike Clubhouse and is also available for both Android and iOS. However, Leher does not have the biggest names in the world on its platform but it does have significant micro influencers and is growing at a rapid pace. Within 180 days of its beta version launch, the company claimed to have its users spend about 44 minutes every day and 250,000 minutes per month for live video sessions.
We at Startup Stories are curious to see which among Leher or Clubhouse would our readers choose to take part in a virtual discussion. Please let us know your answer in the poll below.
Why Are Ads On Digital Media Failing To Reach The Right Audience?
If you are a regular user of social media platforms and also a fan of consuming content on the digital medium, then there is a very high likelihood that you have seen ads on pages you are reading or watching something. There would be times when you have been targeted by an ad which feels like it was wrongly targeted at you. Imagine if you are a vegetarian by choice and while browsing online, if you are targeted by a food delivery app which shows ads about chicken dishes. The ad would only serve to spoil the mood of the online user instead of serving its actual purpose which is to push the user to buy a chicken dish.
These wrongly targeted ads might be the side effects of performance marketing or a weak brand marketing. Performance marketing means advertising programs where advertisers pay only when a specific action occurs. These actions can include a generated lead, a sale, a click, and more. Inshort, performance marketing is used to create highly targeted ads for a very specific target audience at a low cost. Performance marketing usually means high volume for a very specific cost.
Brand marketers on the other hand believe in narrowly defining target audiences but end up spending a lot of money on ad placements. Gautam Mehra, CEO, Dentsu Programmatic India & CDO, Dentsu International Asia Pacific said, “You’ve defined a persona, you know the emotions you want to elicit, but then you buy a YouTube masthead and CricInfo sponsorships because IPL is up. If brand advertisers look at audience-based buys more deeply than just placements, you will see more relevant ads (sic.)”
Performance marketing is more of a sales function rather than a marketing function and is about meeting the cost of acquisition. This is a reason why budgets are usually high for performance marketing. Mehra goes on to add, “the fact is that an engineer can out-beat FMCGs on performance marketing. Advertisers who have cracked this are spending 10x and are on an ‘always on’ mode (unlike time-bound brand campaigns.)”
There is always the case of supply and demand, with the supply usually exceeding the demand on digital platforms. Ultimately, it boils down to the choice between no ad versus low relevance ad and it is quite easy to guess that having a low relevance ad is better.
Arvind R. P., Director – Marketing and Communications at McDonald’s India (West and South,) said “McDonalds’ for instance, has seen its share of spends on digital grow from 20% levels a couple of years back to over 40% at present. Outcomes of this journey have been encouraging, proven by our media-mix-modelling and other key metrics. We have seen best results from an optimal mix of Television plus digital (sic.)” Moreover, Arvind also believes performance marketing only approach could turn out to be more suited to short term, versus a more consistent full funnel effort. The latter ensures adequate emphasis on building consideration, as well as growing transactions. Arvind feels digital is a complex medium which needs investment in the right talent who could use the right tools. Brands which underestimate the need for the investment are often disappointed from the return on investment from the digital medium.
With the constantly changing consumer dynamics marketers are now shifting to unscripted marketing which frankly needs more insights into the consumer mindset. The lack of marketers to do the proper research is why digital medium is plagued with irrelevant ads.
Facebook Launches BARS For Creating Raps To Counter TikTok’s Growing Popularity
Facebook is leaving no stone unturned to tackle the surging popularity of the Chinese video making app TikTok. As part of its redoubled efforts Facebook is launching a new app named BARS which could be used to create and share raps. The core idea behind the app is rappers could focus on creating content without having to worry about investing heavily in production and equipment.
Facebook said, “Audio production tools can be complicated, expensive and difficult to use. With BARS, you can select one of our professionally-created beats, write lyrics and record yourself dropping bars (sic.)” The company also added, “BARS auto-suggests rhymes as you’re writing to keep your flow going. You can also jump into Challenge mode and freestyle with auto-suggested word cues. Choose from a variety of audio and visual filters to take your creations to the next level (sic.)”
The app is now available in the Apple App Store in the United States of America. The invites for using BARS would be sent out in batches beginning in the USA and then expanded worldwide.
This would be the second app which Facebook is launching to counter TikTok’s growing popularity. Instagram Reels was the latest offering from the photo sharing platform Instagram (owned by Facebook) and was launched as a replacement for the video sharing application TikTok. TikTok was enjoying an unrivalled popularity in India as it became a means to keep boredom at bay during the nationwide lockdown which was imposed in light of the COVID-19 virus. However, the Indian government announced that it would ban 59 Chinese applications in which TikTok was one, along with WeChat, Helo, Cam Scanner and many others. This left a sudden void in video making applications, and Instagram realised the need for urgency to capitalize on this void. Therefore, Instagram immediately pushed their latest feature Instagram Reels which lets its users create 15 second videos with music from Instagram’s database. These videos look very similar to the ones made on TikTok and has gained a lot of popularity in India where Tik Tok continues to be banned.
ALSO READ: 4 Things To Know About Instagram Reels
Google also took advantage of the Indian Government’s ban of the viral application TikTok. Google introduced a new feature on YouTube called YouTube Shorts. The feature for all intents and purposes mimics the same features TikTok used to provide. The new feature mimics many of TikTok’s most popular features, allowing users to make and post 15 second videos with built in creative tools encouraging them to add licensed music and more.
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