Blocking innovation ✋

Defense win, key earnings, and hot venture deals.

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Market summary: 📊

Yesterday marked a respectable bounceback in India from Monday’s erosion, but expect this week to be choppy. US markets continued to circle in place.

US:

  • S&P 500 - down 0.30%

  • Nasdaq 100 - up 0.82%

India:

  • Nifty 50 - up 1.03%

  • Sensex - up 0.94%


Bulls eye 🎯

The Indo-US defense cooperation agenda snatched a sweet win. In the latest landmark pact, called the Basic Exchange and Cooperation Agreement (BECA -- nice ring to it), the US has agreed to share critical satellite and surveillance information from its self-owned systems with the Indian side, helping India improve its drones systems and missile targeting capabilities.

The data sharing agreement will see the US' National Geospatial Intelligence Agency exchange information such as nautical maps, geo charts, live imagery as well as real-time threat data at the borders with India’s military of defense, exclusively. Here’s an outline of the technicalities of the arrangement.

What matters is that the information will help India plug crucial gaps in its data-set ups as it combats increasing aggression from neighbors on the North Eastern borders. Also, the timing of this latest arrangement, as the US is currently selling arms to Taiwan (which China is upset about), tells us all we need to know about the changing global sentiment around China.


Who’s dealing? 💰

Betterplace, an employee management platform for the blue-collar workforce, has raised $10 million for a Series B round led by Jungle Ventures. Existing investors Unitus Ventures, 3One4 Capital, and Venture Highway pitched in as well.

The company essentially makes it easy for enterprises to hire, onboard, train, and manage a large blue-collar workforce, with integrations for needs around KYC, digitizing employee records, background verification services, skill development, attendance management and such. Fresh funds will help take chase markets outside India and to improve the product.

Takeaway: India estimates over 3 million gig workers right now -- a tiny portion of the 150 million something blue-collar workforce we have in total. Effectively managing and integrating this group, who drive cabs, bring us food, work in the background to deliver packages etc. is a gigantic opportunity that will remain greenfield for at least a decade.

Secondly, cloud transformation and digitization of HR is still in a very early stage worldwide. Particularly in India, with “digital identity” just taking off, turnkey KYC and other solutions will offer ample room for growth. In all, expect a range of disruptive startups winning here for a long time, nibbling at small portions of the vertical and horizontal opportunities.

Next up, in ecommerce - 🛒

Fresh produce marketplace FreshToHome has finally closed on its $121 million fundraise, netting checks from Investment Corporation of Dubai, Ascent Capital and a few others. The startup has been a huge beneficiary of the COVID-tailwinds supporting e-commerce boom in India, and has swelled to 1.5 million orders a month -- despite operating only in a few metro areas.

The company is looking to be the “Uber of Fishermen and Vegetable” according to founders -- which honestly may not be the best analogy if they’ve looked at the Uber stock lately. Anyway, with the latest capital infusion, an expansion into more Indian cities is coming, with Calcutta being the next biggest play and then into Saudi Arabia. Founders aim to hit $200 million in revenue by next year. Promising!

Finally, closing out on a SaaS deal 📹

Sequoia India has funded video-editing SaaS platform called InVideo (looks like a Canva clone), with a $15 million Series A check. Tiger Global, Hummingbird, RTP Global and Base signed up for the round as well.

Launched barely a year ago, the platform claims to have over 8 lakh users from more than 150 countries who have created videos in over 75 languages. Seriously though, the traction some of these companies scale to in no time is just LIT. How!

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Facebook won’t give in 🎮

Facebook’s latest released cloud gaming service is now available through its website and its Android-app but it won’t be made available on the IOS platform, after FB and Apple have failed to reach a common ground on how apps are policed.

Much like cloud gaming services of Microsoft (xCloud), Amazon (Luna) and Google (Stadia), Facebook’s latest gambit will stream games directly from its data centers onto users’ devices -- without users having to download any games or install any other software. Promised as the next big thing in immersive digital experiences, Game Streaming when combined with 5G and AR, is counted on to unleash a sea change on digital media.

And as always, Facebook has been shrewdly sowing seeds here for the last 5 years, only to have Apple now dent its hopes. In Apple’s defense, its concerns revolve around how these “game streamers” (like FB) allow 3rd party developers (the ones who make games for FB -- like Zynga for example if you’ve ever played Farmville) to embed features and how these developers can or cannot control user data. Basically, Apple in its own right is ensuring another Cambridge Analytica cannot happen.

But innovative platforms are debating whether these blanket rules are actually thwarting innovation, and Apple by tightly controlling 1 billion plus users on its ecosystem, is stopping rapid consumer adoption of the technology.

Bottomline: App stores built for the onset of the smartphone era in 2010 can no longer contain the demands of modern innovation. Consumers demand more -- including seamless sharing of data, photos, embedded social features, etc. so is it fair to just accept and live by “rules” thrown at developers because some tech giants’ “policies” feel violated? Anyway, the world is watching how these conflicts will end.


In closing -- earnings worth mentioning 💳

Among winners -- SBI Life reported a stellar quarter, highlighting the strength of the life insurance business in India right now. Gross premiums grew a solid 28% this quarter, while net profits for the insurer rose 131% to ₹300 cores in the quarter. Consistent with other large enterprises, SBI Life used the pandemic to cut costs as well.

COVID has driven an increased awareness in Indian markets about the benefits of insurance -- and we dearly hope the same sentiment helps broad financial literacy pick pace as well.

Then, there is Bharti Airtel -- with its mixed quarterly performance, as Indian telcos, numbed from the attack from Jio, struggle to make a meaningful comeback. There were some signs of hope though, such as —

  • Revenues were up 7.7%

  • Operating profits up 11.3%

  • Average revenue per user was up to ₹162 vs. ₹157

However, profits were negative for 6 quarters straight now, with a messy ₹16K crore loss in the last 3 months alone. Tch.


What else are we snackin’ 🍿

🌝 Chaand pe pani - For the first time, scientists have confirmed the presence of water on the sunlit part of the moon. This surfaced the possibility that water molecules may be distributed across the surface of the moon and not just limited to the cold and shadowed parts.

📦 Omnichannel to the rescue - Uniqlo is now offering home deliveries in India. The company had just opened stores last year in India, but their strategy got a surprise awakening from COVID as footfalls vanished.

👏 Rooting for equality - Male government employees who are raising a child alone are now entitled to child care leave. The leave will be granted at 100% of leave salary for the first 365 days and 80% for the next 365 days.

💄 Bolly money comes for tech disruption - Bollywood star Alia Bhatt has invested an undisclosed amount in beauty ecommerce platform Nyka. This comes a few days after Katrina Kaif had invested in the platform as well.

🍎 Mitron, ab hum Apple pe hai - Homegrown short video app Mitron has made a debut on the Apple app store. The app was made available on the Playstore so far has witnessed 39 million downloads in just 6 months. TF!!


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