Food delivery continues to dominate the flow of big capital and investors in India’s startup ecosystem with Swiggy being the latest to enter the unicorn league.
The food delivery startup has successfully raised US$210 million in its latest round of funding from Russian billionaire Yuri Milner’s DST Global and existing backer Naspers.
DST Global is one of the world’s most influential tech investor which counts Facebook, Airbnb, and Alibaba in its investment portfolio. For DST, this will be its third investment in India after online retailer Flipkart in 2014 and cab hailing firm Ola in 2015.
The round also saw participation from US-based hedge fund Coatue Management and existing investor Meituan Dianping, a China-based provider of on-demand online services.
It is with this latest funding round that Swiggy’s valuation has increased to US$1.3 billion as per sources with direct knowledge of the development.
Besides, this also officiates the Bengaluru-based firm as one of the fastest internet companies to join the Unicorn club four years after it inception. That is less than half the time it took for its rival food tech company Zomato to earn the title.
The last valuation of Swiggy was at US$700 million in February when it raised US$100 million from Naspers and Meituan Dianping.
With this round, Swiggy’s existing capital will cross US$466 million, which is essential as it continues to compete with Ant Financial-backed Zomato and new competitor entering the space, which includes UberEats and Foodpanda.
Swiggy currently has 35,000 restaurant partners and 40,000 delivery executives across 15 cities. It will use the additional capital to ramp up its supply chain network, expand to new markets and scale its headcount especially in the technology function.
Sri Harsha Majety, the CEO of Swiggy explains, “using this investment, we will continue to widen Swiggy’s offering, along with bolstering our capabilities and plugging the gaps in the on-demand delivery ecosystem.”
Swiggy has also been reportedly looking to increase its supply by exploring investment options with cloud kitchen players and restaurants for its Swiggy Access model even as the firm is working on a pilot of medicine delivery under its offering Swiggy Dash.
If anything, this deal is expected to escalate the fierce competition in the food delivery space, and to an extent boost innovation of the services to grow beyond ride hailing.
According to a Bloomberg report, more than 400 food delivery apps were operational in India between 2013 and 2016. The industry grew by 150% year-on-year and has an estimated Gross Merchandise Value (GMV) of US$300 million in 2016.
At the same time, this sector has witnessed a lot of consolidation. While some ventures with unique ideas has managed to survive, others succumbed to market forces simply due to lack of bad timing or lack of funding.
Currently, the momentum in the food delivery market in India is lead by Swiggy with about 11 million monthly orders followed by Zomato at about 7 million orders across India and UAE. While FoodPanda records about 1 million and UberEats about 750k per month.
However, all is not fixed as in related news, Swiggy’s rival Zomato also raised a US$400 million funding capital, a news that came a few days after Swiggy’s own announcement of a US$210 fresh funding.
However undeniably, the food delivery industry is nearing saturation. Question is – who will come up on the top: Swiggy, Zomato or new entries like FoodPanda or UberEats?
Once upon a time, there was the dot-com boom where just adding that one punctuation and three letters can send stock prices up, on average 74 percent.
It’s not an exaggeration. In January 1999, a company that had yet to turn a profit or does any business called MIS International adopted a new name – Cosmoz.com.
The result was – its stock price rose to $5 from its original trading price at well below $0.50 per share, though it later cooled off at $2. This was happening to 95% of the companies that added: “.com”, “.net” or “Internet” to their name.
People were investing in the bubble.
Fast forward to 2010, the bubble has long popped with internet penetration now in full-blown. Then comes along yet another bubble, this time is driven by mobile adoption, what we’d come to know as the app bubble.
However, it’s not so much a bubble.
Why? It’s not just fortune or the trillion industry it developed into. Apps have become somewhat of a necessary accessory for every startups and user. Especially those in Asia Pacific which counts 1.90 billion mobile internet users.
Apps have become the primary way we engage with media, brands, and ultimately each other. As a result, the strategic importance of the app market that goes beyond the gaming and media industries.
While browsers are still important, it’s the subset of the customer that downloads the apps are your core customers. Every startup need to view themselves as app publishers regardless of their mobile strategy.
Would you like to be able to book a taxi from your email application? How about sending emails while listening to streamed music? Or maybe get takeout while chatting to your love interest on a dating app?
While these scenarios are very unlikely. The idea that you’d be able to do all sorts of activities when you communicate in a single platform or app – is one that is catching on in a big way. A multifunction app.
Take for example, South Korea’s top messenger app KakaoTalk has launched wire transfer services to bank accounts, while Southeast Asia ride-hailing major Grab is extending into the food delivery service.
Though these two are slightly off the multifunction app – as they had split off these functionalities, keeping them sandboxed as separate apps – KakaoPay and Grabfood.
One staying true to the name of the multifunction app is WeChat, a Chinese messaging app. It has around 700 million active account and a massive ambition to being a text/voice/photo-sharing app with expanded functionality to allow you to order cabs, buy film tickets, play games, check in for flights, pay bills… and that’s just the top of the list.
Connie Chan of venture capital firm Andreessen Horowitz said, “while Facebook and Whatsapp measure their growth by the number of daily users on their networks, WeChat cares more about how relevant and central it is in addressing the daily, even hourly needs of its users.”
While the desire to be everything everyone wants is in every app, but on mobile, this is associated with the risk of overloading the user interface and experience, which in any case is something all apps should avoid.
From swiping right to connect with a potential love interest to getting your food or services delivered to your doorstep, apps are not just a technology disruption but has immersed into our ways of live.
Imagine an assistant. One who understands your happiness, anger, sorrow, and laughter. One who knows what you want to watch based on your feelings even before you figure out what your feelings are.
This is the ideation of Gong Yu and iQiyi – to create a technology that provides personalized content and entertainment. How? AI and facial recognition.
Facial recognition algorithms are developed to identify human faces in different shows while AI will extract their corresponding clips. If a user enjoys the performance of a certain actor or actress, she can watch clips that features said actor.
But fact is, iQiyi said they are doing more than just the common application of personalized content. The internet entertainment company is planning to develop a technology that can assist directors in casting actors and editing films.
While starring roles will still be decided by directors, iQiyi will build a database for actors containing their physical information, theatrical genres, behavior patterns, as well as their on-screen time that determine their popularity.
The longer the time is, the more popular the performer is. And all this data collected through algorithms will also apply to business development and decision making, helping to estimate an actor or actress value in terms of promotion and marketing.
Entertainment is just one figment. Truth is facial recognition is now going country-wide in China. From paying the bills to matchmaking, facial recognition has been integrated into different industries in China.
The business has grown even bigger as local governments adopted it to boost surveillance, through building a giant facial recognition database that is capable of identifying its citizens within seconds.
SenseTime, the artificial intelligence company behind this facial recognition technology is the unicorn born from government pushing this need. The startup with a valuation of more than US$3 billion sees surveillance making up a third of its business.
In spite of the public concerns with privacy, the facial recognition tech has proven to be useful – helping law enforcers to successfully catch a white collar fugitive among a 50,000 crowd at a Jacky Cheung concert.
Similarly, in Singapore, the local government is also implementing GovTech, a Singapore government plan to lamp post-as-a-platform pilot project which is expected to begin in 2019. This is part of a broader Smart Nation plan which can be used to improve people’s lives and perform crowd analytics and follow-up investigation.
In Southeast Asia, facial recognition is also gaining commercial use. In Malaysia, AirAsia is using this biometric technology to authenticate guests in an effort to streamline the on-ground experience.
Meanwhile, 7-Eleven in Thailand is also rolling out artificial intelligence at its 11,000 stores across Thailand. The convenience store intends to use facial recognition and behavior analysis technologies to identify loyalty members, analyze in-store traffic, monitor product levels, and even measure the emotions of customers as they walk around.
And while China’s government is hoping to install 400 million surveillance cameras with facial-recognition by 2020, the rollout at Thailand’s 7-Eleven stores remains unique in scope. Facial recognition could potentially be an essential biometric in our scope of daily lives.
Much like the bicycle-trend in China where millions of people in cities across Asia use rental bicycles for short-distance travel, the United States is now in the middle of an scooter-sharing boom.
You won’t believe it. But electric scooters are taking over San Francisco. Made available to rent using phone apps, electric scooters are taking over cities in the United States the same way bicycles have proliferated across Asia.
Companies like Bird, LimeBike, and Spin have spread so quickly that cities are struggling to figure out how, or if, they should regulate how people use these deckless scooters.
Similar to bike-sharing in Asia, local residents complain about obnoxious parking, riders taking over pedestrian sidewalks and scooter trend especially introduce a more significant safety concern than bicycles.
However. the bike-sharing trend is healthily growing with LimeBike being the favored competitor having raised US$50 million in funding from Andreessen Horowitz and Coatue Management.
Despite that, the surprising fact though is that the company winning in this trend according to Axios is Xiaomi.
Yes, the Xiaomi. The Chinese company has a product called the Mi Electric Scooter and the report states that it is what is personalized by Bird, BlueDucks, and Spin. Besides that, Ninebot another scooter designer company cashing in on the trend is also a Chinese company.
While it remains to be seen if scooter sharing can become a cultural institution like ride-hailing or if it’s a passing trend, undeniably the healthy competition will play a big role in fueling this electric scooter startup wars in the near future.
Is Internet killing retail? Summit Media, a publisher in the Philippines is stopping its line of printed magazine as it shifts its titles online. That is starting from today, Summit Media, the publisher of popular magazine titles in the Philippines will no longer be producing print editions of magazines in its network and is going fully digital.
This announcement from Summit Media is a transformation long brewing in the midst of the changing publishing landscape. For its full digital transformation, the 450-strong company will be closing down six remaining print editions of brands already thriving online.
The company’s magazine titles still officially in print circulation prior to the announcement were Cosmopolitan, FHM, Preview, Top Gear, Town & Country, and YES! Magazine. These brands are already thriving online as Cosmo.ph, Preview.ph, Pep.ph (for YES!), Topgear.com.ph, FHM.com.ph, and Townandcountry.ph
This thus marks the end of Summit’s 23-year run as a leading publisher of magazine titles.
Summit Media president Lisa Gokongwei-Cheng explained that this move is to embrace the preferences of the highly connected audiences which now prefer to consume content.
Currently, the company’s websites that bring its popular magazine brands online boast of over 20 million unique monthly users and 33 million followers on social media platforms. It declares itself as the Philippines’ leading digital lifestyle network as well as belonging to the country’s top two local digital media companies.
Of course, this move is not unique and coincides with Mediacorp’s decision to also axed a number of its lifestyle magazine titles, with the closure of 8 DAYS, i-Weekly and ELLE.
That said, a different story is ongoing for the online retailers as they move from clicks to bricks.
Question is, among all these changes, can media-based business owners still eke out a living?