Also in this letter:
■ Recession fears lead Indian executives in the US to look for jobs back home
■ Meta appoints Sandhya Devanathan as its India head
■ Government to set aside Rs 1,000 crore fund for SemiCon push
The stars of the startup world will be honoured on Nov 19
Union cabinet ministers Piyush Goyal and Ashwini Vaishnaw along with Karnataka chief minister Basavaraj Bommai will be guests of honour at the high-powered ET Startup Awards on November 19. They will address the gathering and talk about the government’s role in propelling India’s burgeoning startup ecosystem to newer heights.
Panel discussion: A panel of some of the most influential names in the startup ecosystem will deliberate on the impact of various trends on the local ecosystem. Among them will be Nithin Kamath, founder & chief executive officer (CEO) of Zerodha; Kalyan Krishnamurthy, CEO of Flipkart Group; Harsh Jain, cofounder & CEO of Dream Sports; Sumer Juneja, managing partner, India & EMEA, SoftBank Investment Advisers; and Woman Ahead winner Smita Deorah, cofounder & co-CEO of Lead, an edtech unicorn.
Winners: At a virtual meeting that lasted for more than two hours on October 28, a high-powered jury led by Infosys CEO and MD Salil Parekh picked the ETSA winners, across nine categories, from a shortlist of 45 contenders.
Razorpay, the Bengaluru-based online payments solutions company, won top honours as the Startup of the Year, while Falguni Nayar, founder and CEO of Nykaa, bagged the newly launched CEO of the Year award.
Shekhar Kirani, partner, Accel, won the Midas Touch Award for Best Investor.
Cloud telephony platform Exotel was chosen as the winner in the Comeback Kid category, while Solinas Integrity, a deep-tech firm founded at IIT Madras that develops robotic solutions for the pipeline and sanitation industry, was adjudged the Best on Campus.
Companies need to show 2-3 quarters of profitability before IPOs: Accel’s Kirani
Shekhar Kirani, partner at Accel India, and known for his early bet on Nasdaq-listed SaaS company Freshworks, told ET that companies must show profitability for at least two quarters before they approach the public markets. Kirani bagged the Midas Touch award at the Economic Times Startup Awards 2022. His seed cheque of $1 million in Freshworks led to windfall returns for the Silicon Valley-based venture firm, as the software company made a big-bang debut on the Nasdaq last year, listing at a valuation of $13 billion, an almost four-fold increase over its last private valuation.
Kirani said that the second half of 2023 will see some companies in India attempt to go public, while the same is still not certain for the US.
India a bright spot: Kirani said that the overall outlook was “a perfect storm, but in favour of India”. He pointed out that this is the first time India is seeing more growth and lower inflation than the US. India is looking positive and anecdotally, India is seeing a lot more interest from scaled investors and even from our own LPs (limited partners, or investors in funds), who are questioning the sentiment. So, in general, the India story has not taken as much of a beating as the US and Europe.”
Funding winter persists: According to Kirani, despite the relatively better macroeconomic situation in India, the flow from the funding taps has turned to a trickle here as well.
Indian startups raised about $2.7 billion in the September quarter, against nearly $12 billion during the same period last year, according to data from Venture Intelligence, which tracks startup funding data.
Recession fears prompt Indian executives in the US to dial HR firms in India
As Big Tech firms such as Meta, Twitter, Amazon and Salesforce begin layoffs, and others announce hiring freezes, especially in the US, several Indian-origin executives working in these companies are worried about their future. Reason? They are on work visas.
An H-1B visa holder, if terminated, has 60 days to find another job in the United States. A new employer will have to sponsor him/her and process the relevant documents. If not done within this period, the person has to leave or is deported.
Job challenged: Executives who spoke to ET, shared their fears about being without a job in a foreign land. Some of these executives, who have posts on social media about the job cuts, have seen an outpouring of responses, but without any guarantee.
Looking to come back: With the pace of layoffs accelerating in the past few weeks, the volume of calls to Indian recruitment and search firms has shot up.
While the Indian job market has also come off its recent highs, experts said companies here are still hiring and that working in the country is perceived to be a better bet than elsewhere. Indian companies, including those in IT services, where attrition is high, are still hiring.
Mass layoffs everywhere: Big Tech companies, including Meta and Amazon, have announced mass layoffs in the last few weeks. Meta CEO Mark Zuckerberg said he plans to cut 13% — 11,000 people — of the company’s workforce. Amazon plans to fire 10,000 people, said a New York Times report published on Nov 14. Elon Musk, who bought microblogging site Twitter recently, has fired half of the company’s workforce.
Meta appoints Sandhya Devanathan as its India head
Facebook-parent Meta on Thursday announced that Sandhya Devanathan would succeed Ajit Mohan as Meta India head. Mohan stepped down earlier this month and joined rival social networking company Snap.
Manish Chopra, director and head of partnerships at Facebook India (Meta), had been in charge of the business temporarily following the exit of Mohan, WhatsApp India chief Abhijit Bose and Facebook’s director of public policy Rajiv Aggarwal.
Who is Devanathan? Devanathan has had a career spanning 22 years across the banking, payments and technology domains. She joined Meta in 2016 and helped build the Singapore and Vietnam businesses and teams, as well as Meta’s e-commerce initiatives in Southeast Asia.
In 2020, she was tapped to lead Meta’s gaming division for the APAC region — one of the company’s largest verticals globally.
She is the global lead of Play Forward, a Meta initiative to improve diversity representation in the gaming industry.
Her role at Meta: Devanathan will focus on bringing the organisation’s business and revenue priorities together and report to Dan Neary, vice president, Meta APAC, and be part of the APAC leadership team.
Once she transitions to her new role on January 1, 2023, she will move back to India to lead the India organisation and strategy.
Interestingly, India will come under APAC for Meta, which is a big change considering Ajit Mohan reported to the Menlo Park, California-based Nicola Mendelsohn, vice president of the company’s global business group.
High-level exits: Bose left the firm to chart a new entrepreneurial journey at a time when WhatsApp India has struggled to make any progress in its payments business on the Unified Payments Interface (UPI) amid stiff competition from Google Pay, PhonePe and Paytm.
Former India chief Mohan, who stepped down recently, had joined Meta (then Facebook) in 2019 from Hotstar and served as vice president and managing director of the India business. His move to Snap comes on the back of the firm’s efforts to shore up revenue in India.
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Government earmarks Rs 1,000 crore to fund chip design startups
The government is planning to fund semiconductor design in India and has set aside a fund of Rs 1,000 crore to this end, said IT minister Rajeev Chandrashekhar, while speaking at the 25th edition of the Bengaluru Tech Summit.
The minister also said that the government wants the next generation of devices and products to be designed and architected in India.
This comes as the government is working with companies to set up semiconductor plants as part of the India Semiconductor Mission.
The minister said that by the end of 2023, three out of six devices will be used to power servers for the Indian cloud.
India’s chip push: India unveiled a $10 billion semiconductor incentive package last year but so far the world’s leading chip makers have stayed away. The incentive — in which only three consortiums have evinced interest — has also faced criticism. It is “too expensive” and “risky” due to the lack of participation by any large, experienced player. The government and the consortiums are, however, standing firmly behind their plan to pour billions into chip manufacturing.
Even if one large semiconductor fabrication unit becomes operational soon, India will need at least 40 of those by 2030. If it can attract smaller units, the country may need 80-90 such fabrication units just to meet domestic consumption targets.
While the higher import bill is a worry, the government is also wary of geopolitical tensions, which it perceives as both a threat as well as an opportunity for India.
Chips ‘Made in India’: A joint venture of the Indian conglomerate Vedanta and Taiwanese electronics manufacturing giant Foxconn had signed a Memorandum of Understanding with the Gujarat government to set up a semiconductor and display manufacturing unit in the state. The Vedanta-Foxconn consortium plans to invest over $19 billion in the semiconductor and display-panel sectors in Gujarat.
Mumbai-based ISMC Analog, one of the applicants under a government plan to set up semiconductor fabrication units in the country, is close to sealing a debt deal with a five-bank consortium led by State Bank of India (SBI) for its $3-billion project near Mysuru, in Karnataka.
Reliance Industries and software major HCL are independently “evaluating” deals to purchase a 30% equity stake each in the company, ET had reported on November 9.
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Preparations are underway for the upcoming launch of Vikram S, India’s first privately made rocket. The launch, by Skyroot, India’s first space startup, will take place at Sriharikota’s Satish Dhawan Space Centre on Friday. S Somanath, Chairman, Indian Space Research Organisation (ISRO), said about 100 startups were registered with the space agency and were working closely with it in various domains of the space sector.
US-based cloud computing firm Rackspace has doubled its India revenue on increased demand for multi-cloud solutions, said its CEO. A large part of the company’s global research is driven out of India, with 2,500 of its 7,000 employees located here. “We see more digital natives are moving to more data adoption and cloud native development in India, and that has become an important area for us,” said Amar Maletira, who took charge as CEO a few months ago.
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