Startup Digest: Top stories of the day

Here's a wrap of the top startup stories today (March 18).

Taking a cue from Australia, India should enact a law to make tech giants such as Facebook and Google pay local publishers of news content, senior BJP leader Sushil Kumar Modi demanded in Rajya Sabha on Wednesday. Raising the issue through a Zero Hour mention, the former deputy chief minister of Bihar said, "The government must make Google, Facebook and YouTube pay print and news channels for the news content they are using freely."

The government should take a cue from the Australian parliament that passed the world's first law last month to ensure news media businesses are fairly remunerated for the content they generate, he said. "I would urge the government of India that the way they have notified Intermediary Guidelines and Digital Media Ethics Code to regulate social media and OTT platforms, they should enact a law on the pattern of Australian Code so that we can compel Google to share its revenue with traditional media," he added.

Rajya Sabha chairman and vice president M Venkaiah Naidu remarked that the suggestion is "worth considering". Modi said the traditional print and news broadcast media, whose content is freely available on platforms run by the tech giants, are passing through their worst phase in recent history as advertisements have shifted to tech platforms. "They are in deep financial crisis. Earlier, it was because of the pandemic and now it is because of tech giants like YouTube, Facebook and Google," he said. The traditional news media, Modi said, make heavy investments employing anchors, journalists and reporters who gather information, verify it and deliver credible news.

But advertisement, which is their main source of revenue, has in the past few years shifted away from them with the advent of tech giants like Google, Facebook and YouTube, he said.

Direct-to-consumer beauty brand MyGlamm has closed Rs 175 crore Series C funding round with investments from Ascent Capital, Amazon, and Wipro Consumer, valuing the company at more than $100 million. This is also one of the first investments made by Amazon in a beauty brand in India. Founded in 2017 by Darpan Sanghvi, MyGlamm offers over 600 cruelty-free and vegan products across makeup, skincare and personal care reaching out to over 10,000 offline point of sales across 70 cities in India. It plans to increase the network to 25,000 POS this year, the company said in a statement.

In August last year, MyGlamm acquired POPxo, a digital community for millennial women founded by Priyanka Gill. The company is now run jointly by Sanghavi & Gill. It is currently at a run rate of Rs 210 crore and looking at closing the calendar year with Rs 600 crore, as per the statement.

With the Series C round, MyGlamm has become the fastest beauty brand to cross the $100 million valuation mark in three years of launch.

Space startup Pixxel has raised a $7.3 million seed round from Omnivore and Techstars with participation from Lightspeed Ventures, BlumeVentures, growX, Ryan Johnson and others. This additional funding will enable Pixxel to continue to rapidly scale its operations to meet the growing demand of high-quality remote sensing data through hyperspectral imaging, the Bengaluru-based private earth imaging company said in a statement.

Solar analytics startup Prescinto has raised $3.5 million in a seed round by Venture Catalysts with participation from Inflection Point Ventures, Mumbai Angels and Lets Venture. An IIOT and AI-powered clean energy SaaS platform, Prescinto claims it increases solar power plant generation by 7% at a cost of 0.1% of revenue resulting in 20X-50X RoI. Prescinto’s AI identifies the root causes of the plant’s underperformance in real-time and helps in reducing costs of operation and maintenance. With an aim to increase clean energy without additional investment, the startup identifies and reduces the losses in the plant. This resulted in a return of 20X-50X for solar asset owners and operators in the first year itself.

Titan Capital, iSeed, First Cheque and 3.0 Fund have invested $300K in Chirrup - a video-integrated social gaming platform. The company will utilize this pre-seed round of funding to strengthen the product & provide a world-class user experience, it said in a statement. Founded in 2020, the startup enables friends & families to engage in multiplayer games over a video call.

Chirrup currently offers 9 multiplayer game - Ludo, Chess, Rummy, Draw-It, War Vessels & Crazy 8 and plans to add another 10 games over the next 6 months.

Re-commerce marketplace for used electronic gadgets Cashify has announced an employee stock ownership (ESOP) buyback plan worth $1 million. Under the programme, Cashify’s employees would get the option to liquidate up to 35% of their vested ESOPs. "Cashify has thrived on the entrepreneurial spirit and sense of responsible ownership that our employees bring in their approach. The ESOP buyback is our way of acknowledging and rewarding their efforts. We believe that this will help unlock value, and create wealth for our high-performing talent," said Mandeep Manocha, founder, and CEO of Cashify. This announcement follows a $15 million fundraising from Olympus Capital. Thus is the firm first ESOP sale.

UK-based Compass Group's India unit announced the acquisition of a majority stake in online food-tech startup SmartQ that provides services in the digital cafeteria segment, as per Moneycontrol. Founded in 2014, by Krishna Wage and Abhishek Ashok, SmartQ provides services such as automated billing kiosks, centralised billing system, NFC prepaid cards, POS software to companies. It works towards enhancing cafeteria and food-court experience by eliminating queues and minimising wait time. The acquisition will enable Compass India, to develop and deploy these solutions that will help their clients enhance employee workplace experience playing a key role in reshaping Compass India’s “return to work” strategy.

Integrated real estate platform Square Yards has acquired PropVR – an AI-based platform specializing in creating immersive digital property experiences using 3D technologies, Virtual reality, and Augmented reality. With this acquisition, the company plans to launch new 3D experiences on its portal where users can search, explore and navigate the entire real estate landscape of a city in a 3D environment, a statement said. It plans to showcase real time inventory availability and enable end to end transactions on the platform going forward.

Micro venture capital firm Eximius Ventures has closed its maiden fund of $10 million for investment in early-stage startups, with about $300,000 equity cheque per startup. The firm is looking to invest in at least 25-30 emerging startups over the next three years, across edtech, healthtech, fintech, and gaming and in high potential industries such as B2B SaaS and online media, a statement said.

Alphabet Inc’s Google plans to invest over $7 billion in offices and data centers in the United States this year. Google’s spending includes $1 billion in its home state of California. The move comes at a time when many companies are exiting Silicon Valley after the COVID-19 pandemic triggered a broader shift to remote work, making companies reconsider the state’s higher operational costs and hefty taxes. The investments would create at least 10,000 new full-time Google jobs, chief executive officer Sundar Pichai said.

On the heels of losing a major labor battle in the United Kingdom, Uber will reclassify all U.K.-based drivers as workers. Under the new designation, more than 70,000 drivers will receive some benefits, including minimum wage, holiday time and pension contributions, but they will not get full employee benefits. Uber announced the change in a Securities and Exchange Commission filing, adding that its UK ride-hailing business accounted for 6.4% of all mobility gross bookings in the fourth quarter of 2020. While the move will increase Uber’s costs in the UK, the company is still targeting adjusted EBITDA profitability by year-end, CNBC reported.

Earlier this year, Uber lost a major legal battle in the UK around this issue. The country’s Supreme Court upheld a ruling that a group of drivers were workers, not independent contractors. While the decision applied to a small group of drivers, thousands more have taken action against the company. In an op-ed in The Evening Standard, Uber CEO Dara Khosrowshahi wrote that following the Supreme Court ruling, “we could have continued to dispute drivers’ rights to any of these protections in court. Instead, we have decided to turn the page.”

“I know many observers won’t pat us on the back for taking this step, which comes after a five-year legal battle,” Khosrowshahi said. “They have a point, though I hope the path that we chose shows our willingness to change."

Coinbase Global Inc, the largest US cryptocurrency exchange, said that recent private market transactions had valued the company at around $68 billion this year ahead of a planned stock market listing. The eye-popping valuation underscores how the perceived value of Coinbase has rallied in lock-step with the surge in the price of cryptocurrency bitcoin, Reuters reported.  In a regulatory filing, Coinbase said its stock in the private market traded at a weighted average price of $343.58 in the first quarter of 2021 through March 15. In the third quarter ended Sept. 30, Coinbase’s stock traded at an average of $28.83 per share for a valuation of $5.3 billion. That represents a nearly 13-fold jump in its valuation in the space of a few months.

According to data platform PitchBook, Coinbase was valued at a shade over $8 billion during its last private fundraise in October 2018. Coinbase’s implied valuation eclipses that of New York Stock Exchange parent Intercontinental Exchange Inc (ICE), Nasdaq Inc and the London Stock Exchange, and puts it $4 billion short of futures exchange operator CME Group. Coinbase’s latest valuation is almost 53 times its revenue in 2020. By comparison, ICE currently trades at a 10.67 price-to-sales ratio, according to Refinitiv data.

The latest filing from Coinbase also signals heightened confidence that the listing will be approved by regulators. A successful listing by Coinbase, whose business is primarily focused on digital currencies, would represent a landmark victory for cryptocurrency advocates vying for endorsement for a sector that has struggled to win the trust of mainstream investors, regulators and the general public, the report said. It could also be seen as a tacit regulatory approval of assets traded on Coinbase’s platform. The company has more than 43 million users in more than 100 countries. Coinbase did not indicate in the latest filing if it had received approval from regulators that would allow it to trade cryptocurrencies that have been classified as securities in the United States.