Startup Digest: BYJU’s expects to turn cash-flow positive in 2-3 months, Rapido challenges HC order & Tech bosses could face jail after UK backs down over online harm

Edtech giant Byju’s CEO BYJU Raveendran said the company’s losses almost halved in 2022, adding they are not far away from profitability at a group level, while speaking to CNBC-TV18 at World Economic Forum in Davos. BYJU’s losses swell to Rs 4,588 crore in delayed FY21 results.

“The DNA of looking at efficiency has not been lost. I have enough people with founder mentality. Only two out of the core 20 people left the organisation. We have increased founder mentality through our acquisitions. It takes time to shift focus to growth. Along with growth, profitability is also important. All our businesses are high-gross margin and fundamentally strong,” added Raveendran.

He also said there is not much difference between the company’s gross and net revenue, the only difference is the taxes it pays, adding BYJU’s is not playing with wafer-thin margins to achieve profitability.

BYJU’s has laid off over 4,000 employees in a bid to cut costs. Talking on possibility of more sackings, Raveendra said they have cut down on brand initiatives and optimising on the people front, adding they expect to start generating cash by the next quarter.

“We have close to 50,000 people. It’s been very tough for us to let go a small percentage of this number. We have good visibility towards becoming cash-flow positive in each of our subsidiaries in the next 3-4 months,” said Raveendran.

On the plans for IPO, the founder said that, “exploring all options, expect an announcement in the next 2-3 months.”

The bike taxi aggregator Rapido has approached the Supreme Court against the Bombay High Court order which had directed it to shut down all its services in Maharashtra as it was functioning without any licence.

Citing urgency before the apex court, the ride-hailing startup said the move to halt its operations will impact thousands of employees. The firm also cited Uber plea that is pending in the court, arguing that SC had stayed Bombay HC order against Uber.

"I have thousands of employees. This court had granted stay in a matter concerning Uber. I'm just like Uber,” said Rapido.

The Supreme Court has agreed to hear the company’s plea on January 23. Rapido was asked to close down all its services — bike taxi, rickshaw and food delivery in Maharashtra till January 20, 2023.

WOW Skin Science, a D2C and personal care brand, has joined Open Network for Digital Commerce (ONDC), an initiative of the government to democratise e-commerce in India.

WOW Skin Science will be open to buyers from all ONDC seller apps, thus expanding the horizon of the brand’s presence, the company said in a statement. The firm further added that with the help of Shopalyst’s plugin for Shopify-powered stores, WOW products will be made instantly discoverable on the ONDC network. With this integration, WOW will feature its catalogue on all apps that a consumer is shopping from across a network that is rapidly developing, while seamlessly facilitating transactions,” it added.

“With the launch of WOW on ONDC, we will have another avenue to expand WOW’s customer base and widen our reach across the nation,” said Manish Chowdhary, Co-Founder, WOW Skin Science.

Startup enabler T-Hub launch of two new cohort programmes — the fifth cohort of its funding programme, T-Angel, and the second cohort of its first product development program, RubriX.

T-Angel Cohort 5 is a sector-agnostic program that has shortlisted 20 startups from 675 applications from across the country. The program offers a mix of investment learning, mentorship and evaluation for 100 days to help startups connect with investors, other startups, advisors, partners and the well-networked T-Hub ecosystem.

RubriX, the 100 days product development programme will help startups in building products with global standards. The startups, by the end of the programme, will have their Minimum Viable Product (MVP) ready to market. A total of 13 startups were shortlisted from 325 applications across the country for the RubriX program, which are from various industries and sectors including fintech, healthcare, education and EV, among others.

The announcement follows T-Hub winning the ‘Best Incubator in India’ award at the National Startup Awards 2022.

Startup incubator Centre for Cellular and Molecular Platforms (C-CAMP) has won its third National Award at the National Startup Awards 2022 as an Ecosystem Enabler from Startup India and DPIIT.

“C-CAMP looks to contribute to this phenomenal growth by nurturing more deep-science innovation and science-led entrepreneurship in the biosciences as a vehicle for both economic and societal impact. Our next aim is to help position India as the biotech innovation capital outside of the Global North,” said C-CAMP CEO and Director, Dr. Taslimarif Saiyed.

It has built a portfolio of over 350 startups and innovators across 34 states and UTs in India. C-CAMP has invested up to Rs 80+ crore in these startups of which close to 100 have raised up to Rs 2000+ crore in follow-on funding at a cumulative valuation of over Rs 6000+ crore.

Dronetech company TSAW has launched its logistics arm, DRONECO, to recreate the logistics ecosystem by introducing a new and faster mode of transportation — drones.

DRONECO will facilitate point-to-point drone transport supply chain logistics services with the primary goal of delivering goods to customers in a timely manner, the firm said in a statement.

It also intends to be the go-to last-mile logistics facilitator for ecommerce platforms, armed forces, medical suppliers and others.

B2B manufacturing and automation startup Groyyo has appointed former co-founder and CTO of ThreadSol, Abhishek Srivastava as its chief technology officer (CTO).

Under his leadership, the company intends to transform its technology team to further develop its tech stack to fulfil its mission of digitising over 20 million SME manufacturers across Asia. The Saas firm also plans to invest about $5 million in technology development over the next year and a half in-line with this appointment, it added.

“As we continue to grow, having scaled 10x in the last 12 months, we are very excited to strengthen our leadership team with the appointment of Abhishek as our new CTO. His vast experience founding and scaling pioneering manufacturing SaaS (software-as-a-service) solutions across Asia will certainly aid our mission,” said Subin Mitra, Co-Founder and CEO, Groyyo.

About 125 million Indians, less than 10 percent of the total population and less than 20 percent of the internet population transact online today. As these numbers grow and consumer behavior and shopping patterns continue to shift online, India represents a massive, trillion-dollar digital opportunity around Internet-led consumption in this coming decade, as per a report by Bessemer Venture Partners.

In the last five years, over 300 million women have come online in India, with almost two of every three new internet users being female. In today’s decade (2020-2030), the new internet marketplaces and brands will be built to serve these new consumer segments which have come online more recently and who have been underserved thus far, as per a report by Bessemer Venture Partners.

Today, over half of India’s 50 million-plus SMEs are now digitally engaged, thanks to increased Internet adoption, digital payment infrastructure, and increased digitisation of small businesses, according to Bessemer research. It also added that startups addressing these new verticals and audiences will win by niche segmentation and personalisation. The report said while doing this, these new businesses will reach product-market fit and scale more rapidly.

In the coming decade, India will see continued growth of existing large internet incumbents as they continue to build on their advantage of scale and distribution. Meanwhile, several hundred billion dollars of value will be generated by businesses serving these new consumer segments through novel business models using these new emerging channels of distribution, said the report.

While 2010-2020 saw mostly B2C internet marketplaces leading with catalog-based commerce, as per Bessemer Venture Partners, this next decade will see the rise of three kinds of businesses in India: Consumer (B2C) marketplaces for new consumer segments, Direct to Consumer brands (D2C) for new and existing consumer segments, and B2B marketplaces for SMEs. Moreover, we believe that all 3 categories of businesses will be built for both products and services.

In 2022, jobs and professional networking platform, apna witnessed more than 31 million professional conversations among women from Tier 1, Tier 2, and beyond cities with an overall 36 percent year-on-year increase in women users on the platform.

As per the report, apna saw around an 80 percent increase in the number of new women users on its platform. The report further suggests that apna has seen a 2.5x increase in job postings for part-time jobs on the platform along with a 3x surge in job postings for full-time jobs.

Companies such as Paytm, Zomato, Rapido, and Swiggy among others, have been among the top partners posting maximum jobs for women to diversify their workplaces. Apart from tier 1 cities like Hyderabad, Kolkata, and Chennai, job postings in tier 2 cities like Indore have seen a 28 percent year-on-year surge, while Chandigarh and Lucknow have seen a 15 percent increase each.

Interestingly, labour-intensive roles such as delivery, lab technicians, factory workers, and drivers saw a 34 percent increase in job applications, coming in exclusively from women. apna also saw a 67 percent growth in job applications from women for part-time jobs vis-a-vis a 34 percent increase in full-time jobs.

Tech bosses could be jailed if their platforms repeatedly fail to protect children from online harm after Prime Minister Rishi Sunak's government agreed a deal with lawmakers to avoid the prospect of a first parliamentary defeat.

Sunak faced losing a vote in the House of Commons on Tuesday after 50 Conservative lawmakers and the main opposition party said they would support an amendment designed to toughen the Online Safety Bill.

The rebels had tabled an amendment proposing jail sentences of up to two years for tech bosses for failing to protect children from content such as child abuse and self-harm.

The government has agreed to changes to the legislation that will make senior managers at tech firms criminally liable for persistent breaches of the new rules, two members of parliament told news agency Reuters.

Microsoft has said it is widening access to hugely popular software from OpenAI, a startup it is backing whose futuristic ChatGPT chatbot has captivated Silicon Valley.

Microsoft said the startup's tech, which it so far has previewed to its cloud-computing customers in a program it called the Azure OpenAI Service, was now generally available, a distinction that's expected to bring a flood of new usage.

The news comes as Microsoft has looked at adding to the $1 billion stake in OpenAI it announced in 2019, two people familiar with the matter previously told Reuters. The news site Semafor reported earlier this month that Microsoft might invest $10 billion; Microsoft declined to comment on any potential deal.

Microsoft is likely to receive an EU antitrust warning about its $69 billion bid for "Call of Duty" maker Activision Blizzard, that could pose another challenge to completing the deal, Reuters reported.

The European Commission is readying a charge sheet known as a statement of objections setting out its concerns about the deal which will be sent to Microsoft in the coming weeks, the report said.

The EU antitrust watchdog has set an April 11 deadline for its decision on the deal. Microsoft said: "We're continuing to work with the European Commission to address any marketplace concerns. Our goal is to bring more games to more people, and this deal will further that goal."

Activision Blizzard, the US video game developer behind hit franchise Warcraft, said its Chinese publisher NetEase had turned down a proposal to extend their long-time partnership for six months as it looks for a new partner.

In a statement on microblogging site Weibo, the US firm's subsidiary Blizzard China said it contacted NetEase last week with a proposal to extend their partnership and that the Hangzhou-based company had declined.

"It is a pity that NetEase is not willing to extend services of our game for another six months on the basis of existing terms as we look for a new partner," Blizzard China said. Blizzard China said its game services will end on January 23.

China's video games regulator has granted publishing licences to 88 online games, including titles belonging to Tencent, NetEase and miHoYo.

Shenzhen-based Tencent, the world's largest gaming company, received at least one game licence for a mobile game named "Yuanmengzhixing", the list published by the National Press and Public Administration showed.

NetEase, China’s second largest gaming company, also received a licence for a shooting game named "Chaofanxianfeng". miHoYo, the famed developer behind Genshin Impact, secured one licence for a game named Honkai: Star Rail.

Last month, China granted publishing licences to 44 foreign games for domestic release after nearly 18 months, effectively marking the end of China's crackdown on the industry.

Didi Global's Chinese ride-hailing app returned to some Android app stores, according to news agency Reuters checks and a source with direct knowledge of the matter, signalling its emergence from around 1-1/2 years of regulatory troubles.

Didi has been awaiting approval to resume new user registrations and downloads of its 25 banned apps in China as a key step to return to normal business since its regulatory problems started in mid-2021.

The ride-hailer, launched in Beijing in 2012 and backed by prominent investors including Alibaba, Tencent and SoftBank Group, ran afoul of the powerful Cyberspace Administration of China (CAC) regulator when in 2021 it pressed ahead with a US stock listing against the regulator's wishes, sources previously told Reuters.

Bitcoin is on the charge in 2023, dragging the crypto market off the floor and electrifying bonk, a new meme coin.

The cryptocurrency has clocked a 26 percent gain in January, leaping 22 percent in the past week alone, breaking back above the $20,000 level and putting in on course for its best month since October 2021, just before the Big Crypto Crash.

Ether has also risen, by 29 percent this year, helping drive the value of the overall global cryptocurrency market above $1 trillion, according to CoinGecko.