Startup Digest: GoM on online gaming likely to recommend 28% GST, Zomato plunges to record low, upGrad acquires Harappa Education

The Goods and Services Tax (GST) Council's Group of Ministers (GoM) are likely to impose a 28 percent tax on gross gaming revenue from casinos and online gaming when they meet next.

The GoM, which is headed by the Meghalaya Chief Minister, met offline in Bengaluru and Goa noting the concerns from the industry. The GoM met in Bengaluru on Saturday and met the online gaming and race course industries to understand the mechanism of how betting is done at these platforms. On Sunday, the GoM went to Goa to examine how casinos operate.

People in the know have indicated to CNBC-TV18 that after noting all the industry stakeholders’ concerns, views and suggestions, there is an in-principle approval to levy 28 percent GST on gross gaming revenue. The GoM is likely to submit its final report soon.

However, it is important to note that the GoM members from Tamil Nadu, Maharashtra, Gujarat, Telangana and West Bengal did not attend this meeting held over the weekend in Bengaluru and Goa.

It has also been understood that there could be another meeting or maybe these members will be allowed to submit their responses in writing to the GoM post which only a final report will be given to the GST council and the last date is August 10, 2022.

Shares of food delivery giant Zomato fell more than 14% to a record low on Monday, as a one-year share lock-in period for promoters, employees and other investors expired following the 2021 listing.

Zomato made a stellar debut on July 23, 2021, in the Mumbai market, but its shares have lost more than 60% of their value since then on concerns about valuations and as global growth stocks cratered.

Including Monday's losses, Zomato shares have lost nearly 30% since the company announced its deal to buy local grocery delivery startup Blinkit in June. The company now has a market value of 366 billion rupees ($4.58 billion), compared with 1.29 trillion rupees at its all-time high in November.

Edtech unicorn upGrad has acquired the online learning institution Harappa Education for Rs 300 crore (about $38 million). The edtech major closed the transaction with present Harappa shareholders - Bodhi Tree Systems (a newly-formed platform between James Murdoch and Uday Shankar) and Co-Founders Pramath Raj Sinha and Shreyasi Singh.

Harappa Education is likely to clock Rs 75 crore in revenue this year. It has an active clientele of 100 mid and large-sized organisations.

"A combination of upskilling courses along with these critical skills that Harappa has to offer would set us apart. We see strong demand from our clients and with Harappa coming in, we believe we'll be able to grow exponentially within the segment as we cross-leverage the synergies," said Ronnie Screwvala and Mayank Kumar, Co-founders of upGrad.

Earlier this month, upGrad Rekrut, a 100 percent subsidiary of online higher education platform major upGrad, announced it has acquired recruitment and staffing firm Wolves India, for an undisclosed sum.

CommerceIQ, a retail e-commerce management platform, has acquired the UK-based digital shelf analytics provider e.fundamentals for an undisclosed capital.

As part of this acquisition, e.fundamentals will merge operations with the US-based CommerceIQ. Customers will have access to the combined offerings and customer-obsessed support team worldwide, a statement said.

The acquisition will help CommerceIQ expand its global e-commerce retailer coverage, allowing consumer brands to boost their market share in high inflation and supply-constrained environment

"Customers are asking us to accelerate our coverage to global retailers (such as Amazon, Walmart, Target, and Instacart) important to their business. Our acquisition of e.fundamentals meets that demand, adding world-class digital shelf analytics and support for more than 440 retailers across 40 countries," said Guru Hariharan, founder, and CEO of CommerceIQ.

The deal comes after CommerceIQ turned unicorn after raising $115 million in a Series D funding round from SoftBank Vision Fund 2 at unicorn valuation earlier in March.

Peaceful Progress, an early-stage focused Angel Fund, has announced the first close of its maiden fund with a corpus of Rs 50 Crore and will invest up to Rs 3 crore in each startup.

The SEBI registered Category-I Alternative Investment Fund (AIF) has built its initial corpus from over 15 angel investors and HNIs. The Fund has made four investments since it obtained SEBI approval in February including Expertrons, an edtech startup, Kredily, an SME HR & Payroll platform, Sheru, a new generation energy storage company and Infilect, an image recognition AI platform.

Peaceful Progress is sectors like Fintech, Healthtech, Edtech, Foodtech, Consumertech, D2C, Electric Vehicles as well as other new-age disruptors and looking to invest in 15 to 20 early-stage businesses over the next 3 to 4 years.

Trading platform, Better Opinions has raised $2.5 million in a seed funding round from a host of investors including Metaplanet VC. YCombinator, Taurus VC, Original Capital, Tremis Capital, Super Capital, and other investors, including angel investors, also participated in the funding round.

The startup will use the fresh capital to build and expand the product and tech team, towards marketing and user growth. It also plans to add a social layer to trading, making it more accessible, fun, and educational.

"The funds will also be used to make Better Opinions a trading cum social platform. We have so far seen an excited user base, who are eager to trade and invest in our platform, and their demand for more events and categories is a testament to the potential of our product," said Samay Jain, co-founder CEO, Better Opinions.

ChefKart, an at-home cooking services platform, has raised $2 million in a seed round of funding led by Pravega Ventures and Blume Ventures. The round saw participation from Deepinder Goyal, Titan Capital, Kunal Shah, Tremis Capital, Lets Venture, and other prominent angels.

The firm aims to upskills local cooks into trained and professional home chefs. As per the company, the capital raised will be utilised to further Chefkart’s vision to become the lead provider of subscription-based at-home cooking services in Gurugram and expansion to other geographical territories.

The products and services offered aim to revolutionise the end-to-end kitchen needs of users. One of the immediate goals for the business is to improve the customer experience and increase tech adoption among service providers.

Personal hygiene brand Svish on The Go has bagged Rs 10 crore in Pre-Series A funding round led by Wami Capital, with participation from existing investor LC Nueva AIF. Brightbridge Advisors was the investment banking partner for the company on this transaction.

The brand plans to use the fresh capital to expand its existing product portfolio, create awareness about hygiene below-the-belt products and regimes for men/women (intimate products) and improve customer engagement strategies.

Spardha, a digital training platform, has raised Rs 8 crore in a Series A2 funding round led by Mumbai Angels. The startup intends to use the fresh capital to expand its sales and operations team, upgrade its products, build its brand, and ramp up its marketing efforts to gain a stronghold in the global market.

"We believe this funding will help us achieve our goal of expanding our footprint and augmenting our product offerings," added Saurabh Srivastav, founder, and CEO, Spardha. The company also plans to garner a user base of 50,000 in the coming months.

Biz2Credit, a provider of an online marketplace for small business funding has announced its ESOP policy worth $500, 000 for its 500+ employees in India. This is a progressive and inclusive scheme that will cover almost 100 percent of the workforce, rewarding people for their commitment and contribution to the organization, a statement said.

"The ESOP plan reflects our company's priorities and balances key financial measures with individual performance and tenure considerations. We have announced the ESOP plan to allow our employees to participate in the organisational success of Biz2Credit," said Rohit Arora, CEO and co-founder, Biz2Credit and Biz2X.

Moove, a mobility fintech and Uber’s largest vehicle supply partner in EMEA, has entered India as part of its global expansion. The firm which provides revenue-based financing to mobility entrepreneurs has expanded from its African roots to Mumbai, Hyderabad, and Bengaluru. The startup offers accessible vehicle financing exclusively to drivers on Uber’s platform.

It plans to launch 5,000 CNG and electric vehicles in the first year and will also look to scale to 30,000 vehicles over five years. “We’re expanding our revenue-based vehicle financing model to enable the sustainable creation of jobs across the country,” said Ladi Delano, co-founder and co-CEO at Moove. "There are some of the lowest vehicle ownership rates in the world, in part because of the lack of access to credit."

With over 600,000 drivers on Uber in India, the launch will unlock the opportunity for Moove to provide accessible financing to thousands of drivers, a statement added.

Hasbro India is set to launch some of its classic board games in Tamil as it steps up its focus on local sourcing and manufacturing its products in India. In the coming months it also plans to launch some of these games in other languages such as Malayalam, Telugu and Kannada, a statement said.

The toy and board games makers had last year launched Monopoly Deal Card Game in Hindi. Now, it has launched Monopoly, Game of Life, and the Monopoly Deal card game in Tamil.

“In the coming months, Hasbro plans to launch these games in Telugu, Malayalam, and Kannada. All these games are Made in India and for India, strengthening Hasbro’s commitment to boost local sourcing and manufacturing in the country," the company added.

Tesla has disclosed it has received a second subpoena from the U.S. Securities and Exchange Commission over its Chief Executive Elon Musk's tweets in 2018 about taking the electric automaker private.

Tesla said in a filing that it received the subpoena on June 13. The regulator had initially subpoenaed the company in November related to a settlement that required Musk's tweets on material information to be vetted.

The November subpoena came days after Musk asked his Twitter followers whether he should sell 10% of his Tesla stake to cover tax bills on stock options. The company said it will cooperate with the government authorities.

After scrapping the $44-billion Twitter deal over the presence of fake/spam accounts, Tesla chief executive officer (CEO) Elon Musk questioned the company's way of measuring its user base, which it uniquely calls "monetisable daily active users" (mDAUs).

In 2019, Twitter for the first time used the word mDAU, saying it believes that monetisable DAU, and its related growth, "are the best ways to measure our success".

Twitter says its mDAUs are not comparable to current disclosures from other companies, many of whom share a more expansive metric that includes people who are not seeing ads.

A follower asked Musk: "$TWTR changed what it considers an active user and how it counts them about 3 years ago. @Twitter developed a proprietary method (mDAU) that's not based on any standardised industry methodology. Since then, the number of active users has been steadily increasing".

Musk replied: "Odd" and "Indeed".

In the April-June period this year, Twitter said it reached 237.8 million users - a significant growth (up 16.6% compared with Q2 of the prior year) despite posting $270 million net loss in Q2.

Big tech companies have agreed to reduce harmful online content in New Zealand, making a move that critics said dodged the alternative of government regulation.

Meta Platform, Alphabet-owned Google, TikTok, Amazon.com and Twitter had signed a code of practice, said Netsafe, a government-funded internet-safety group.

The companies would follow the code as self-regulation, Netsafe chief Brent Carey said in a statement. "There are too many Kiwis being bullied, harassed, and abused online, which is why the industry has rallied together to protect users," Carey said in a statement.

Industry lobby group NZTech will be responsible for the companies meeting obligations, which include reducing harmful content online, reporting how they do that and supporting independent evaluation of results.

Investors looking to sell stakes in Shein are evaluating bids at discounts of about 30% to its $100 billion valuation in April, according to Bloomberg News, amid concern about the Chinese fast-fashion giant’s slowing growth.

While some current shareholders in the private company are considering cashing out ahead of a future initial public offering (IPO), the valuation spread between buyers and sellers remains a hurdle to any trade, the people said, asking not to be identified because the matter is private.

Slower sales growth and criticism over Shein’s environmental, social and governance record could have an impact on the IPO timeline and valuation, the people said. These factors, along with the recent market turmoil in technology companies, have influenced some investors’ thinking about whether to sell at least part of their stakes privately, they said.

Google said it has dismissed a senior software engineer who claimed the company's artificial intelligence (AI) chatbot LaMDA was a self-aware person. Google, which placed software engineer Blake Lemoine on leave last month, said he had violated company policies and that it found his claims on LaMDA to be "wholly unfounded."

"It's regrettable that despite lengthy engagement on this topic, Blake still chose to persistently violate clear employment and data security policies that include the need to safeguard product information," a Google spokesperson said in an email to Reuters.