Also in this letter:
■ Slice to merge with North East Small Finance Bank
■ BluSmart tweaks fare structure in Delhi-NCR
■ Karnataka asks gaming firms to collect 28% GST
Top honchos to discuss blueprint for sustainable business on ETSA night
(From left) The panel for ETSA 2023 – Prashanth Prakash, partner, Accel; Harshil Mathur, cofounder & CEO, Razorpay; Aadit Palicha, cofounder & CEO, Zepto; Rashi Narang, founder, Heads up for Tails; and Lalit Keshre, cofounder & CEO, Groww
Leading new-age entrepreneurs, chief executives and investors will come together for a panel discussion on ‘New order for Startup Inc: Decoding the playbook for sustainable businesses’ at The Economic Times Startup Awards (ETSA) in Bengaluru on October 7.
The panel: The panel — comprising Lalit Keshre, cofounder & CEO of Groww; Prashanth Prakash, partner at Accel; Harshil Mathur, cofounder & CEO of Razorpay; Aadit Palicha, cofounder & CEO at Zepto; and Rashi Narang, founder of Heads up for Tails — will discuss the way forward for the Indian startup and technology economy as it looks to come out of what has been one of its worst downturns.
What to expect? The panel discussion at the ETSA ceremony will assess the importance of building profitable and sustainable businesses in an environment where the ‘growth at all costs’ strategy has taken a backseat. The theme was also dominant during the jury deliberations on September 12.
The backdrop: In the last one year, several companies in the new economy ecosystem have witnessed a correction after a low-interest rate regime in 2020 and 2021 led to a surge in investments and valuations—both private and public. This became clear with the amount infused by risk capital investors plummeting through the last 12 months.
ETSA 2023 | OfBusiness seeks ‘high’ of having its ticker on exchanges
B2B ecommerce platform OfBusiness, which won the prestigious Startup of the Year award at the Economic Times Startup Awards 2023, is gearing up for its initial public offering (IPO) expected to be launched next year.
OfBusiness cofounder and CEO Asish Mohapatra said that while the exercise is being undertaken to allow some of its early investors to exit, there was a “philosophical high” to see the OfBusiness ticker on the stock exchanges.
“I think there is that feeling in us. When we started off, we said we would do it in eight years. It’s almost eight years now, and it’s not going to happen until next year, but there is a passion that you want to see the name,” he added.
Good corporate governance: Mohapatra underscored that the commitment to take the company public is one of the key drivers of good corporate governance in the firm. “The belief is that we have to list…in listing, if your corporate governance is good, you will get a premium of 10-15%.”
From QR codes to tokens, firms parse ideas for age-gating
As the implementation of the new Data Act gathers pace, social media platforms are considering a myriad ways to verify the age of users as mandated by the new law including through a QR code or the virtual Aadhaar ID.
What the law states: The government notified the Digital Personal Data Protection Act (DPDPA), 2023 in August, under which personal data of children under the age of 18 can be processed only after obtaining verifiable consent from parents or legal guardians. This entails establishing the age of the child, and the relationship between the parent and the child.
This impacts social media companies in a major way, as a significant chunk of their users are below 18 years of age.
Also read | Only kids-focused sites may gain from age-gating tweak in data bill
Ways of age-gating: Companies are experimenting with several methods to comply with the new law. One way being suggested is a QR code generated by an authority like the Unique Identification Authority of India (UIDAI) to verify whether an individual is a minor. The virtual ID by UIDAI is another privacy-enhancing technology. Some kind of industry standard can emerge at the app store level, where all regulated entities are able to verify the ages of users, an official said.
Also read | Age gating industry-wide challenge, need workable solutions for it: Snap head of global safety Jacqueline Beauchere
Security nightmare? Senior government executives said this system must be implemented well, or it can turn into a security nightmare for citizens. Another official, however, clarified that the law doesn’t mandate people to reveal their age; it only asks them to certify whether they are a minor or above 18 years of age.
Tough rules will hurt Metaverse innovation, say firms, experts
Metaverse companies are averse to new regulations and laws in the mushrooming sector, opining that such a move will hamper innovation and growth. This comes as the Telecom Regulatory Authority of India (Trai) floated a paper last week proposing regulation of the sector.
Experts agree: To bring the Metaverse under oversight, the government needs to harmonise multiple bodies including the Meity, Trai, and the department of telecommunications, all of which are in the process of deliberating similar policies, experts said.
“With the recent passing of the DPDP (Digital Personal Data Protection) Act, 2023 and the proposed Digital India Act on the anvil, the government is already building safeguards for safety and security in the online world,” said Aarushi Jain, partner and head – media, education & gaming, of law firm Cyril Amarchand Mangaldas.
Industry stance: The industry endorsed the telecom regulator’s views on recommending guidelines and principles for utilizing real-time emotional data and authorisation of digital identities in the virtual world. But Trai must only recommend and not regulate, they said.
Slice to merge with North East Small Finance Bank
Rajan Bajaj, founder and CEO, Slice
Joining the growing list of firms with banking ambitions, credit card and digital payments unicorn Slice said on Wednesday that it is merging with North East Small Finance Bank (NESFB).
No objection from RBI: The fintech startup said it has received a no-objection certificate from the Reserve Bank of India (RBI) on the merger, and is awaiting shareholder consent and other regulatory approvals.
Slice, which has been running an NBFC for the last four years, had the option to convert itself into a bank either by applying for a fresh licence (after crossing the five-year mark as an NBFC) or acquiring one.
Small beginnings: New York-based Tiger Global and Japanese investor Gunosy-backed Slice had picked up a 5% stake in the Assam-based NESFB for less than Rs 30 crore, ET had reported on March 8.
Opening newer avenues: With a small finance bank in its fold, Slice can issue deposit accounts to its 15 million users and give out credit cards directly. The deposit float will also allow the fintech to better manage the supply of funds to offer credit.
Also read | For many fintechs, NBFC tag may be elusive
EV ride-hailing startup BluSmart tweaks fare structure in Delhi-NCR
Anmol Jaggi, cofounder, Blusmart Electric Mobility
Gurugram-based ride-hailing startup BluSmart has changed its fare structure to expand its user base. The company, which offers electric cars on its platform, has reduced the range of its fare slabs from 5 km to 3 km to offer more fare choices to consumers.
New slabs: Earlier, the base fare of Rs 149 was applicable if a customer travelled anywhere between 0-5 km, with the 6-10 km slab having a Rs 199 fare. This has now been revised to Rs 149 for 0-3 km and 3-6 km, with the 6-9 km slab having a Rs 199 fare.
Company’s rationale: “Overall, as the slabs come down, customers won’t overpay or underpay. A large proportion of our customers travel 9-10 km, but there aren’t so many who travel for a 6-7 km range…the revision will help us attract those customers as well,” cofounder and CEO Anmol Singh Jaggi told ET.
Karnataka asks gaming firms to collect 28% GST on full face value
Karnataka’s GST authorities have written to 161 online gaming firms asking them to collect GST at 28% on the full face value of bets in online real money games, with effect from October 1, and to file returns as per the revised rate.
Details: The finance ministry, which amended the provisions of the central GST (CGST) and integrated GST laws, implemented the revised rate from October 1. Official sources said a few states are yet to revise their GST rates in alignment with the CGST law.
Also read | Karnataka notifies GST Ordinance to tax online money games at 28%
Other Top Stories By Our Reporters
(L-R) DPDzero cofounders Ranjith Ramachandra and Ananth Shroff
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India market growing faster than global average: Dassault CEO Bernard Charles | He said demand for precision and quality manufacturing has increased the uptake of Dassault’s solutions in India as more clients are expanding in other markets.
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