Also in this letter:
- Uber makes Rs 2 crore job offer at IITs
- ASCI, Centre in talks over crypto ads
- Indian SaaS + IT — A winning combo
Binny Bansal sold part stake in Flipkart to Tencent
Flipkart’s cofounder Binny Bansal.
Binny Bansal offloaded a part of his shareholding in Flipkart when the Walmart-controlled etailer last raised funds in July, sources told us.
- Binny Bansal’s part stake, amounting to $200-250 million, went to existing investor Tencent Holdings of China.
- The Bengaluru-based Flipkart was valued at $37.6 billion after raising $3.6 billion from the likes of Canada’s CPPIB, Singapore’s GIC and Japan’s SoftBank.
He now holds 2.4% stake in the company—down from 2.7% earlier—amounting to roughly $900 million at Flipkart’s latest valuation.
The exit: When Walmart picked up 77% stake in Flipkart for $16 billion in May 2018, Sachin Bansal exited the firm and took $1 billion while Binny Bansal—who was made Flipkart Group CEO—stayed on. The Walmart-Flipkart deal—the largest in India’s e-commerce space so far—made the duo the country’s youngest billionaires at that time.Angel moves: Bansal has been an active angel investor, more so post his exit from Flipkart.To be sure, he had been in active discussions with investors to set up his own fund, but those talks haven’t fructified yet. He was looking to raise ~$400 million for his maiden fund. Bansal has invested in early-stage fund 021 Capital as its main backer, or a limited partner.
Further windfall awaited: Bansal’s 2.4% stake in Flipkart will likely be worth a lot more when the company finally decides to go public. The July funding in Flipkart was the first capital infusion from external investors since Walmart acquired it in 2018.
Uber brings back Rs 2-crore job offers at IITs
Uber Technologies has emerged as the top paymaster on day one of final placements at the Indian Institutes of Technology, handing out Rs 2 crore-plus package offers.
- The Uber package amounts to approximately $274,250, or about Rs 2.05 crore, including around $128,250 (approx. Rs 96 lakh) base pay, target cash bonus, new hire grant and a sign-on bonus.
The offer marked the comeback of a Rs 2-crore compensation package on IIT campuses after a nearly six-year gap. Last year’s top package across IITs was a $200,000, or Rs 1.48 crore offer from San Jose-headquartered IT company Cohesity.
Uber did not comment on its package.
“Uber is hiring engineers for its centres in Hyderabad and Bengaluru,” a spokesperson told ET. “As part of this continuing recruitment drive, Uber regularly visits top tech campuses across India, including IITs, to give graduates opportunities to apply for open roles.”
TWEET OF THE DAY
ASCI in talks with Centre to refresh crypto ad guidelines
The Advertising Standards Council of India (ASCI) is in discussions with the government to refresh guidelines related to cryptocurrency advertising.
- ASCI seeks to include adequate disclosure of risk, ensuring that consumers don’t mistake crypto products to be legal tender and are not misled by exaggerated claims or by unfair comparisons with regulated asset classes, General Secretary Manisha Kapoor said.
On Tuesday, Finance Minister Nirmala Sitharaman said in Parliament that the government is studying the ASCI guidelines on misleading advertisements so that it can take a position on complaints of deceptive crypto ads.
- The ASCI is in “active discussion with the government and other experts” on crypto guidelines and seeks “to resolve issues that concern consumer interest”, Kapoor told us.
As such, ASCI’s existing code already requires all advertising “to be honest and not exploit consumers’ lack of experience or knowledge”, and this applies to ads across all categories, including crypto products, she said.
Catch up quick: Amid the controversy on lack of regulation and a possible regulatory clampdown on the sector, crypto exchanges such as CoinSwitch Kuber, WazirX and Bitbns have paused advertising. In recent months, including during the ICC T20 World Cup, crypto exchanges had spent an estimated Rs 50 crore on advertising across mainstream and social media channels. While Amitabh Bachchan and Ayushmann Khurrana had signed up as brand ambassadors of CoinDCX, Ranveer Singh has endorsed CoinSwitchKuber.
Quote: “While the crypto exchanges have paused advertising and are awaiting clarity from the government, they are all making blueprints for fresh advertising which will show claims that are toned down,” said a media buying executive working directly with one of the big crypto exchanges.
RBI whitelist of good companies can ease payments woes
The Reserve Bank of India should create a whitelist of “good companies” that will help them be unaffected by rules on payments to build their businesses here, Freshworks CEO Girish Mathrubootham said.
- “For SaaS businesses where you have to have customers’ credit cards on file, there is some improvement that we could do with RBI payment infrastructure. The rules are not helping SaaS companies,” Mathrubootham said at Nasscom Product Conclave.
Tell me more: The statement comes after RBI introduced new guidelines for recurring payments in October which made it mandatory for subscribers to renew standing instructions for services they have opted for. RBI also said all payments above Rs 5,000 should adopt an additional layer of authentication.
The RBI’s primary objective in adopting the new framework is to protect consumers from fraudulent transactions and enhance convenience by allowing them to opt out of services more easily. The rules have, however, impacted tech and startup firms that rely on regular payments from subscribers.
“I know the rules exist for a reason and to protect consumers from fraud, but maybe we should have a whitelist of good companies that are allowed to build their businesses,” Mathrubootham said.
Infographic Insight
Indian IT + SaaS — A symbiosis takes root
As Indian SaaS startups gain scale and vie for larger global deals, there’s a growing scope for them to partner some of the country’s largest IT services firms to manage and implement digital transformation projects at a rapid scale.
Early signs of such partnerships are already visible.
Nasdaq-listed Freshworks Inc., which announced a strategic tie-up with Tata Consultancy Services Ltd, in June last year, is partnering with India’s IT bellwether on around 50 projects.
- “What we have seen is services companies realise that the disruption is coming from Cloud and software-as-a-service… Companies like TCS actually understand that there is a change coming,” Girish Mathrubootham, cofounder and chief executive at Freshworks, said at the Nasscom Product Conclave on Wednesday.
For healthcare-focused SaaS firm Innovaccer, which has partnered with HCL Technologies Ltd, the next stage of growth will be dependent on partnerships with system integrators and large IT services companies, cofounder and CEO Abhinav Shashank said.
- “We are pitching to tens of customers together. We are doing global demand generation activities together. We are pitching digital transformation deals that could basically be double-digit million ARR sort of deals,” he said.
Both Shashank and Mathrubootham believe that there is a big opportunity for a symbiotic relationship between Indian SaaS and IT firms. While some of it might be scale dependent— given the size of the software services firms, small software makers might find it harder to build meaningful partnerships—but as the industry for Indian software products grows, so will the opportunity. (read more)
Cred to acquire Happay to expand fintech offerings
Cred founder Kunal Shah.
Kunal Shah’s Cred has agreed to acquire Happay, a corporate expense management platform, in a cash-and-stock deal to add to its suite of fintech offerings.
- Newtap Technologies Pvt. Ltd., a company floated by Shah personally, recently acquired Parfait Finance & Investment, a non-bank lender.
- Cred has applied to the Reserve Bank of India for a payments aggregator licence, in line with the company’s strategy of enabling ecommerce on its platform.
- Cred has launched Cred Mint to enable users to on-lend to other customers following a tie-up with LiquiLoans—an RBI-registered P2P non-banking lender.
About the deal: While financial details of the proposed Cred-Happay deal weren’t disclosed, the transaction pegs Happay’s valuation at nearly $180 million.
The company, founded by Anshul Rai and Varun Rathi, will operate independently but work closely with Cred’s leadership to leverage its ecosystem, build distribution and expand product offerings. The Happay team of 230 will get all the benefits extended to Cred employees, including its ESOPs programme.
Other Done Deals
■ Cloud kitchen startup EatClub Brands—formerly known as BOX8—has raised $40 million from New York-based Tiger Global at a post-money valuation of $340 million.
■ NxtWave, a Hyderabad-based edtech startup, has raised $2.8 million in a funding round led by Orios Venture Partners and Better Capital to fuel its expansion plans and grow its revenue by five times over the next 12 months.
■ CollegeDekho has raised $35 million in a Series B funding round led by Winter Capital and ETS Strategic Capital to improve its offerings for students and colleges in India and abroad.
Other Top Stories By Our Reporters
■ RateGain Travel Technologies, will open its three-day initial public offering for subscription on Dec. 7, making it the first Indian software-as-a-service firm to list on the local bourses that is planned for Dec. 17.
■ WhatsApp banned about 2.07 million accounts in India in the month of October, mainly on the basis of technology tools deployed to prevent harmful behaviour and a few accounts on user complaints, its latest regulatory disclosure showed.
■ Nykaa plans to more than triple its brick-and-mortar stores to 300 to significantly increase its offline presence in India, CEO Falguni Nayar said without specifying a timeline for the planned expansion.
Global Picks We Are Reading
■ Facebook risks meta flop, metaverse developers say (Reuters)
■ Salesforce co-CEO Bret Taylor has growth on the mind (Bloomberg)
■ Open Facebook’s ‘black box’, whistleblower tells house panel (AP)
Graphics and illustrations by Rahul Awasthi.
