It’s Friday and time to look around and get caught up on what’s happening in cashback in India. An Assocham study says Indian online luxury stores will generate $35 billion in sales in 2016 and grow at 27% annually. Startups in India seem unfazed by Morgan Stanley‘s and other mutual funds’ 25% write-down in their investments in Flipkart. Cashkaro generated $74 million in 2015 for its cashback partners and expects to reach $148 million in 2016. TechinAsia celebrated International Women’s Day with profiles of 10 top female Indian tech entrepreneurs including Ankita Jain, co-founder of GoPaisa.
While it’s not a tech bubble in India, Sanjay Nath, managing partner at Blume Ventures, says it’s back to basics for e-commerce startups. With several acquisitions on the horizon, Amazon India is making plans to build its own digital wallet. The Advertising Standards Council of India upheld false advertising claims against numerous companies including seven e-commerce leaders and several using “cashback” in their marketing claims. KartRocket raised $2 million from an undisclosed Japanese investor in addition to an earlier $6 million round in January.
The Rise of Online Shopping for Luxury Brands in India
An ASSOCHAM study proposes that the online luxury stores will see an influx of 35 billion dollars in 2016 and by 2020 the study foresees the market to get doubled. Through 2017-2018 the market is expected to grow at a compounded annual growth rate of 27%.
While India has always had a traditional luxury clientele, who shopped on their trips abroad, the inflow of money in the rising Indian economy in last two decades has also seen rise in the premium segments. As a result, Indian people have become more discerning, gradually raising their standards for quality and service, and looking for more luxury experience. Via indianexpress.
Start-ups unfazed by Flipkart’s valuation markdown
Start-ups and smaller e-commerce companies are not concerned after Morgan Stanley lowered the valuation of domestic e-tailer giant Flipkart. While there was worry that the markdown valuation may have a cascading effect on the entire segment, most companies BusinessLine spoke to were of the opinion that this should be seen as a correction in the market, rather than a total bust.
Over two dozen start-ups, both early-stage and a few that have raised Series A and above, said that it is ultimately the individual performance of each company, unit metrics, growth and traction that will dominate valuation discussions.
They also feel that Flipkart’s markdown will not overly impact on the funding activity among the start-ups. Swati Bhargava, founder of cashback start-up CashKaro.com said, “The valuation by Morgan Stanley is perhaps reflective of how investors are increasingly skittish over tech valuations nowadays and focusing more on revenue generation and profitability”. Via thehindubusinessline.com
Expect to generate Rs. 1000 cr ($148 million) in sales for partner retailers in next few months: CashKaro
Talking about the growth of the portal and its partners, Swati & Rohan Bhargava, Founders, inform that they have generated over Rs 500 crore ($74 million) of sales for their partner retailers in 2015. Via economictimes.indiatimes.com
Meet 10 trailblazing, inspiring Indian women entrepreneurs
Exuberant and youthful, Ankita Jain is the co-founder marketing head of GoPaisa, a cashback site. “Keep a positive mind, and don’t take ‘no’ for an answer,” she says.
Nearly three years ago, she entered the startup world at the age of 23, and “most brands did not take us seriously. The concept of cashback was non-existent.” Now the site claims to have a million plus users.
“Being an entrepreneur is what I always wanted for myself. It gives me the freedom to do what I believe is right. I never wanted someone to order me [around],” says Ankita. And she points out some other huge plus points: economic independence, creative freedom, and work-life balance. We can’t agree more! via Tech in Asia
Indian start-ups get back to basics
Several entities that followed the burn-cash model have been forced to shed jobs and improve their business models. Among the more known names, Zomato, Housing and TinyOwl have shed jobs. Flipkart, the largest e-commerce company and the most highly valued start-up, saw investor Morgan Stanley mark down the value of its (minority) stake by 27 per cent. While factors such as growing competition and not meeting the growth targets could have influenced this, the message for the rest of the start-up system was clear – pull up your socks.
“One thing which certainly happened was that the valuations of B2C (business to consumer) companies weren’t justified. What you’re seeing is more in terms of right-sizing or to be fairly valued,” said Sanjay Nath, managing partner at Blume Ventures. “I wouldn’t use the term ‘bubble’, as that would signify India’s fundamentals are not strong. That’s definitely not the case.”
The fundamentals of India as a market are very strong, he adds. There’s a huge growth in smartphone sales, the uptake of third-generation (3G) technology data connectivity is growing and 4G services are coming in. Growth in tier-II and tier-III cities is very high, and as these are highly underpenetrated, the opportunities are immense. via Business Standard
Amazon India planning to launch digital wallet
Amazon India is firming up plans to launch a digital wallet as part of its efforts to build an online payments business, potentially through acquisitions, four people familiar with the development said.
Amazon’s largest domestic rival Flipkart launched its digital wallet last week as online payments increasingly become pivotal in the race for dominance in India’s ecommerce market, giving Internet companies greater control over transactions.
Amazon India is “looking at multiple acquisitions (in online payments). It is a major focus area and the company is trying to figure out what it needs to do”, one of the sources said, adding that the company has initiated acquisition talks with digital wallet and payments startups. Via m.timesofindia.com
ASCI calls out Snapdeal, OLX, Uber & others for false advertising
The Advertising Standards Council of India’s (ASCI) Consumer Complaints Council (CCC) has upheld complaints (pdf) against 42 out of 79 advertisements brought to it in December 2015. These adverts belonged to various categories: 8 in personal and healthcare, 9 in education, 3 in telecom and broadband, 7 in ecommerce and 15 from other categories. Via medianama.com
India: E-commerce enabler KartRocket raises $2m from Japanese investor
BigFoot Retail Solutions Pvt. Ltd, which owns and operates e-commerce-enabling solutions provider KartRocket, on Tuesday said it has raised $2 million from an undisclosed Japanese investor, in addition to $6 million it raised in January to close the round.
The $6 million round was led by Bertelsmann India Investments, the strategic investment arm of German media conglomerate Bertelsmann SE and Co. Existing investors Nirvana Digital India Fund, Nirvana Digital Investment Holding Co. Ltd, US-based 500 Startups and Singapore-based Beenext also participated in the round.
New Delhi-based KartRocket caters to the small and medium enterprises market in India by enabling merchants to go online. It provides companies web and mobile phone sites, payments and logistics capabilities and marketing and promotion tools. Via dealstreetasia.com
Cashback continues its global growth
Next week we’ll continue our focus on cashback and e-commerce companies in other key markets around the world. Remember, you can get updates in your inbox Monday through Friday mornings by subscribing at the top of this page. Join us for news you can use!