Startup Digest: Urban Company Announces Rs 150-Cr Psop; Crypto Payment Gateway Transak Comes To India

Ashneer Grover alleges ‘personal hatred, low thinking’ in BharatPe’s statement

Ashneer Grover said he was appalled but not surprised by BharatPe’s statement declaring he is no longer the founder of the fintech firm and accusing him and his family of engaging in misappropriation of funds.

“Appalled at the personal nature of the company’s statement, but not surprised… statement comes from a position of personal hatred and low thinking,” he told CNBC-TV18, shortly after BharatPe issued a statement against Grover.

BharatPe’s board met on March 1 evening to take Grover’s resignation on board and to review the results of an external audit report of the company.

Earlier on March 2, the fintech firm released a statement saying the Grover family and their relatives engaged in extensive misappropriation of company funds. They created fake vendors through which they siphoned money away from the company’s account and “grossly abused” company expense accounts in order to enrich themselves and fund their lavish lifestyles, the statement added.

The company also said, “As a result of his misdeeds, Mr Grover is no longer an employee, a founder, or a director of the company.”

Reacting to the remark, Grover said, “I want to learn who among Amarchand, PWC, and A&M (external audit firms) has started doing an audit on ‘lavishness’ of one’s lifestyle? The only thing lavish about me is my dreams and ability to achieve them against all odds through hard work and enterprise.”

Sources close to BharatPe pointed out that the shareholder agreement allows room for legal action against Grover if found guilty of misconduct and that 1.2-1.4 percent of Grover’s total shares are restricted and can be clawed back.

To this, Grover responded saying BharatPe’s board needs to be reminded of $1 million worth of secondary shares investors bought from him in Series C, $2.5 million in Series D and $8.5 million in Series E.

Urban Company announces Rs 150-cr partner stock ownership plan (PSOP)

On-demand home and beauty services marketplace Urban Company has announced a partner stock ownership plan (PSOP) for its service providers.

Under this initiative, the startup will award stocks worth Rs 150 crore to thousands of service partners over the next 5-7 years, according to a statement.

The company will set up an evergreen trust to manage the PSOP plan, and award them at near zero cost to service partners.

“With this, gig workers will become shareholders of Urban Company. The company has already got board approval for the first tranche of Rs 75 crore worth of stocks, to be disbursed over the next 3-4 years,” Varun Khitan, Co-founder and COO of Urban Company told CNBC-TV18.

With approximately 30,000 partners on its platform, Khaitan said the selection process and how many gig workers will be selected for the PSOP plan will be unveiled by the company in the next few months.

The PSOP plan for gig workers will be a rolling programming. “We want the Rs 150-crore worth stocks to multiply in the coming years,” added Khaitan.

The startup will set up a fair and meritocratic process to grant these stocks, taking into account both the performance of service partners and their longevity on the platform. The entire process will be rule-based and transparent, with an advisory panel providing overall guidance, it added.

As per the recently released UC Earnings Index, partners who delivered at least 30 orders a month, earned Rs 30,455 per month, with the top quartile of partners earning Rs 38,263 per month.

Edtech startup Practically acquires ERP software Fedena

Edtech platform Practically has acquired enterprise resource planner (ERP) software Fedena, for an undisclosed amount.

With this acquisition, Practically claims to be the world’s first edtech company to offer a comprehensive end-to-end product suite for schools.

The integrated product will now offer one-in-all product and services that a school needs from experiential learning content, innovative and collaborative teaching tools, to easy-to-use administrative and support tools, the firm said in a statement.

“This move not only boosts our active user base but also gives us an immediate global reach, besides allowing us to offer our product and services to Fedena’s existing network of schools,” said Charu Noheria, Co-Founder and COO, Practically.

Cloud kitchen startup Kitchens@ merges with Kitchens Centre

Cloud kitchen firm Kitchens@ has merged with Kitchens Centre. As per the firm, the merger makes Kitchens@ one of the biggest players in the space, with 1,000 kitchens in around 100 locations in 20 cities.

Currently, Kitchens@ has 12 hubs with 350 kitchens in Bangalore. It works with food brands like Domino’s, Subway, Taco Bell, Nando’s, Chicking, and national chains such as ITC, Mainland China and Barbeque Nation.

With this merger, Kitchens@ will now be operational in Delhi, Mumbai, Pune, Hyderabad, Bengaluru, Chennai, Kolkata, Chandigarh, Jaipur, Ranchi, Indore, Lucknow, Jamshedpur, enabling more than 150 brands.

“We have aggressive plans to expand rapidly across India. We found Kitchens Centre to be a good partner in terms of vision, expertise and shared values in the team. We are excited and confident that this union will help us scale up rapidly and bring unparalleled solutions to our existing and prospective clients. This merger will enable us to expedite national and international franchisee operations pan India,” Junaiz Kizhakkayil Founder & Chairman, Kitchens@ said.

This is the second big consolidation in the sector in 2022. In January, Cloud kitchen company Curefoods announced its merger with rival Maverix.

Google and MeitY Startup Hub to help 100 Indian startups scale globally

Google and MeitY Startup Hub has announced a cohort of 100 early to mid-stage Indian startups, with an aim to help build global apps and games as part of the Appscale Academy.

The collaboration initiates the growth and development programme to support Indian startups to grow in global business platforms.

The cohort’s main sectors include health, education, finance, social, e-commerce, and gaming. It also spans to startups supporting core communities in India through creative apps across agriculture, B2B, parenting, and more, a statement said.

Furthermore, the collaboration aims to represent the talent diversity emerging among India’s startup ecosystem with 35 percent of the cohort coming from tier 2 and tier 3 cities, including Surat, Vadodara, Kanpur, Lucknow, Meerut, Morbi, and 58 percent of the cohort having a woman in a leadership role.

Crypto payment gateway Transak expands into India; to help users directly buy crypto using Indian rupee

UK-based fiat-to-crypto payment gateway Transak has launched its operation in India.

Transak’s launch in India marks the entry of the nation’s first and only fiat on-ramp provider, the company said in a statement on March 2. The payment gateway already runs operations in more than 60 countries.

Transak said in addition to building a team of more than 50 local talents, it has partnered with marquee web3 players like Polygon, WazirXNFT, and Zilliqa and are under process to further integrate with Mudrex, edge wallet, and others.

Transak said it would enable users to buy cryptos using bank transfers, debit/credit cards, wallets, UPI, and various payment applications worldwide. Transak’s gateway is integrated with fiat payment methods around the globe, which could further be used to make the purchase.

Trell expands ethnic wear portfolio; onboards W, Aurelia, and Wishful

Influencer-led social commerce platform, Trell has announced the expansion of its Indian ethnic wear category by launching popular women’s wear brands W, Aurelia, and Wishful on its marketplace.

The move is in line with the company’s goal to build a robust fashion portfolio that caters to the needs of every shopper on the platform, it said in a statement.

With offices reopening in March, the platform expects a higher boost in demand for apparel — especially in smart casuals and women’s ethnic wear.

In February, Trell witnessed a sharp increase in solid kurta sets, casual tunics, and cotton kurtis. The new brand additions will enable working women to browse through a larger selection of Indian wear and be office-ready for the upcoming season, it added.

Convenience commerce platform The NEW Shop opens 55 new outlets

Convenience commerce platform, The NEW Shop, that offers food, FMCG, essential services and hyperlocal deliveries, has opened 55 new stores in the Delhi-NCR region within the past 12 months.

The brand has also launched an instant delivery app (currently in beta version) with an aim to launch the next 500 stores within the next financial year.

The firm is also expanding to two new airports in the next month and is aiming to target South Asian and African markets. The company claims to be growing at a rate of 200 percent per quarter.

ASU Thunderbird School of Global Management rolls out Mumbai Global Initiative to educate 100 million learners by 2030

The Thunderbird School of Global Management at Arizona State University, has launched a new global initiative in Mumbai to educate and empower 100 million learners by 2030.

Thunderbird will offer an online Global Management and Entrepreneurship Certificate, consisting of five world-class courses in 40 different languages. The certificate will be covered by full scholarships and thus will be made available at no cost to learners, it said in a statement.

In year one, the Global Initiative aims to reach learners in India, Colombia, Iran, Kenya, Mexico, Indonesia, Egypt, Senegal, Brazil, and Vietnam in 10 languages. By year two, the programme will be expanded across Africa, the Middle East, Asia and Latin America to at least 25 languages. By year four or earlier, the Global Initiative will have expanded to Europe and Central Asia, the statement said.

LocoNav sets up e-Shram camps for Drivers

LocoNav, a fleet management solutions company, will be setting up e-Shram camps for the driver community at three prominent Transport Nagars in the Delhi-NCR region on March 4.

The firm said the move is aimed at empowering the driver community in India. The fleet tech startup further aims to integrate access to the e-Shram portal by Government of India-Ministry of Labour and Employment into its platform in the future to enable fleet owners and operators.

Simpl to recruit over 250 employees in 2022

BNPL platform Simpl has announced its aggressive hiring plans for 2022. The fintech startup expects to hire over 250 employees this year across different verticals.

The company plans to expand its engineering team heavily and is looking to hire from top-tier colleges across the country. Simpl tripled its engineering team over the past 18 months to 100.

As a part of its commitment to gender diversity, Simpl is also proactively putting efforts to bridge the male to female ratio in its engineering department, it said in a statement.

Investments in the agritech sector touch Rs 6.6K cr till 2020: Bain-CCI report

India’s rural economy has contributed to nearly half of the nation’s overall GDP in 2019–2020. Two-thirds of India’s population participated in its rural economy in the past two years, and agriculture — the largest sub-sector within rural economy, had the highest share of output, contributing approximately 37 percent of the total rural GDP, as per a report by Bain & Company and Confederation of Indian Industry (CII).

Supported by central government and private sector initiatives towards physical and digital infrastructure, the agriculture sector has been growing steadily at a compound annual growth rate (CAGR) of 11 percent since 2015, the findings showed.

UPI transactions in rural India doubled in the past year; and agri credit grew approximately 10 percent over the last five years. According to Bain-CII estimates, about 30 percent of the rural ecosystem is adopting digital payment and digital commerce solutions to avail easier access to agri-financial services.

The agritech companies that address inefficiencies across the value chain will have explosive growth potential, it added. Significant domestic and international investments are being pumped into the sector to improve efficiency and access to credit.

Private-equity investments in the agritech space have skyrocketed in the last four years, growing at more than 50 percent per annum to aggregate approximately Rs 6.6K crore till 2020.

Fintech sector to raise the most venture debt in 2022: Stride Ventures Report

Fintech is expected to be the most active sector in raising debt, followed by consumer and agritech, as per a survey conducted by venture debt firm Stride Ventures.

The fintech sector saw 28 percent of all venture debt deals, the highest among all sectors in 2021 followed by consumer at 21 percent and B2B commerce at 16 percent. The fintech sector also received the majority of investments at 47 percent, the report showed.

In 2021, a total of $538 million of venture debt was disbursed as compared to $271 million in 2020. The average ticket size of venture debt deals in 2021 was $5.85 million. The average equity funding raised by venture debt-backed startups in 2021 was $126 million, the report added.

Companies which are in Series D and beyond stages saw the most deals (31), raising $250 million in 2021 followed by Series A stage companies who have raised $112 million.

GLOBAL TECHNOLOGY & STARTUP NEWS

Google blocks RT, Sputnik from Play app store in Europe

Google has blocked mobile apps connected to RT and Sputnik from its Play store, in line with an earlier move to remove the Russian state publishers from its news-related features, Reuters reported.

A number of tech companies have limited distribution and advertising tools to Russian news outlets in recent days as the European Commission readies a ban on them out of concern that they are spreading misinformation about the war in Ukraine.

RT Deputy Editor-in-Chief Anna Belkina said in a statement on March 1 that technology companies that have cut her outlet’s distribution have not pointed to any evidence that it has reported falsehoods.

Apple said on March 1 that RT News and Sputnik News were no longer available for download from its App Store outside Russia.

Twitter to comply with EU sanctions on Russian state media

Twitter will comply with the European Union’s sanctions on Russian state-affiliated media RT and Sputnik when the EU order takes effect, the social network said.

“The European Union (EU) sanctions will likely legally require us to withhold certain content in EU member states,” a Twitter spokesperson said in an emailed statement to Reuters.

“We intend to comply with the order when it goes into effect.”

EU industry chief Thierry Breton has said the European Commission expected approval by late on March 1 from member nations for the ban on the Kremlin-backed outlets.

Outside the EU, Twitter said it would continue to focus on reducing the visibility of content from these outlets as well as labelling it.

Apple says it halts all product sales in Russia

Apple said it has paused all product sales in Russia in response to the Russian invasion of Ukraine, as per a Reuters report.

“We are deeply concerned about the Russian invasion of Ukraine and stand with all of the people who are suffering as a result of the violence,” Apple said in a statement. “We are supporting humanitarian efforts, providing aid for the unfolding refugee crisis, and doing all we can to support our teams in the region.”

The company outlined a number of actions in response to the invasion, including stopping all exports into its sales channels in the country. Apple Pay and other services have been limited, the company said. The Russian state media, RT News and Sputnik News, are no longer available for download from the Apple Store outside Russia.

On March 1, users in Russia were still able to access Apple’s online store but attempts to buy an iPhone showed that they were not available for delivery.

Ukraine’s tech diaspora races to mobilise Silicon Valley in war with Russia

Ukrainians working at Western tech companies are banding together to help their besieged homeland, aiming to knock down disinformation websites, encourage Russians to turn against their government and speed delivery of medical supplies.

They are seeking, through email campaigns and online petitions, to persuade firms such as internet security company Cloudflare, Google and Amazon to do more to counter Russia’s invasion of Ukraine.

“Companies should try to isolate Russia as much as possible, as soon as possible,” said Olexiy Oryeshko, a staff software engineer at Google and a Ukrainian American. “Sanctions are not enough.”

He was one of nine tech activists interviewed by Reuters who are of Ukrainian heritage or are Ukrainian immigrants and are responding to a call by Kyiv to form a volunteer ‘IT army.’

They are appealing to cybersecurity companies in particular, asking them to drop Russian clients, especially publishers of what they say is disinformation. If that happens, the publishers would be more vulnerable to online attacks.

EU checking if cryptoassets being used to bust Russian sanctions: EU official tells Reuters

The European Commission is studying whether cryptoassets are being used to get around financial sanctions imposed on Russian banks following the country’s invasion of Ukraine, a senior European Union official told Reuters.

Trading volumes between the Russian rouble and the Tether cryptocurrency spiked on February 28 as the local currency tumbled to a record low on Western sanctions, as per Reuters.

Crypto exchange Binance has, however, blocked accounts of any Russian clients targeted by sanctions.

A senior EU official said the EU is aware that cryptoassets were a “possible circumvention route” to avoid sanctions imposed by the bloc and other western powers.

The EU’s executive European Commission has been reading reports in the press on cryptoassets and has also received information directly, the official said.

“The increase in value of some of these assets may be a response to attempts to circumvent the sanctions. We are looking into this, but no decision has been taken,” the EU official said.

US can regulate cryptocurrencies without new law, think tank says

US regulators can largely use existing laws to bring digital assets such as cryptocurrencies under their supervision without new congressional legislation, one of Washington’s most influential liberal think tanks said.

Agencies, including the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), could use the report from the Center for American Progress (CAP) to inform their decisions on how to govern cryptocurrencies, according to Reuters.

Regulators have not yet determined how best to regulate cryptocurrencies, in particular so-called ‘stablecoins,’ whose creators say they have pegged their values to the dollar and other fiat currencies. The US Treasury Department kicked the issue to Congress in a report last year.

The think tank said it would be helpful for Congress to address gaps within the current regulatory framework — such as creating rules for crypto commodities. But it warned that a new and distinct regulatory structure for crypto could inadvertently weaken supervision and create regulatory arbitrage.

Salesforce posts upbeat results on hybrid work boost

Salesforce has reported quarterly revenue and profit above Wall Street estimates, as a pandemic-led shift to hybrid work kept up the strong demand for its cloud-based software, sending its shares up 4 percent in extended trading.

San Francisco, California-based Salesforce’s subscription and support revenue for the fourth quarter rose 24.7 percent to $6.83 billion.

Along with demand for its platforms like Customer 360, the recent addition of Slack’s workplace app also helped the cloud-based software maker in adding users.

For 2023, Salesforce expects revenue of $32 billion to $32.1 billion, above expectation of $31.78 billion. The company’s revenue rose 26 percent to $7.33 billion in the quarter, beating analysts’ estimate of $7.24 billion, according to IBES data from Refinitiv.

On an adjusted basis, Salesforce earned 84 cents per share, topping estimates of 74 cents. However, its current quarter and full year adjusted earnings guidance came below expectations.

The company also forecast first quarter revenue to be between $7.37 billion and $7.38 billion. Analysts on average expect it to be $7.26 billion.

Fitbit recalls over 1 mn of its Ionic smartwatches on burn hazard worries

Google-owned fitness tracker maker Fitbit has recalled over a million of its Ionic smartwatches following reports of burn injuries from overheating batteries, the US Consumer Product Safety Commission (CPSC) said.

Fitbit said it had received “a very limited number” of injury reports and the total number of the smartwatches recalled was less than 0.01 percent of units sold, Reuters reported.

“These incidents are very rare and this voluntary recall does not impact other Fitbit smartwatches or trackers,” the company said in a statement.

The CPSC said Fitbit had received at least 115 reports in the United States and 59 from overseas about overheating batteries that caused burn injuries, some were third and second degree burns.