Gojek founder and CEO Nadiem Makarim resigns to join Indonesian cabinet; Soelistyo and Aluwi to be new co-CEOs

Nadiem Makarim, founder and CEO of Gojek, said on Monday he has stepped down from his role at the ride-hailing startup to join Indonesia president Joko Widodo’s cabinet.

The announcement, which has taken many by surprise, comes a day after Widodo was sworn in for a second term. Widodo has previously said that he wants young business executives to join his cabinet.

In a statement, a Gojek spokesperson told TechCrunch that Andre Soelistyo, Gojek Group President and Kevin Aluwi, Gojek co-founder, are taking over as co-CEOs of the startup.

“We are very proud that our founder will play such a significant role in moving Indonesia onto the global stage. It is unprecedented for a passionate local founder’s vision to be recognized as a model that can be up-scaled to help the development of an entire country,” the spokesperson said.

“We have planned for this possibility and there will be no disruption to our business. We will make an announcement on what this news means for Gojek within the next few days. We respect the process set out by the President and will not make a further comment until there is an official announcement from the Palace,” the spokesperson added.

Makarim (pictured above) said he was honored that the president had asked him to join his cabinet as a minister. He did not reveal which position he would hold, but an announcement from Widodo is expected later this week. “I am very happy to be here today as it shows we are ready for innovation and to move forward,” he told reporters.

Makarim founded Gojek in 2010 as a two-wheeler hailing service. The startup has since expanded to include a range of services including mobile payments, food delivery, online shopping and most recently on-demand video streaming.

The startup has amassed more than 2 million driver partners and 400,000 merchants on its platform. Gojek was valued at almost $10 billion in its most recent financing round. The company, which operates in Singapore, Vietnam, and Thailand, clocked gross transactions worth $9 billion last year.

Makarim comes from a prominent Indonesian family: His parents are anti-corruption activists, while his grandfather is an independence hero.

MyGate raises $56M to bring its security management service to more gated communities in India

MyGate, a Bangalore-based startup that offers security management and convenience service for guard-gated premises, said today it has bagged more than $50 million in a new financing round as it looks to expand its footprint in the nation.

Chinese internet giant Tencent, Tiger Global, JS Capital and existing investor Prime Venture Partners funded the three-year-old startup’s $56 million Series B financing round. The new round pushes MyGate’s total fundraise to $67.5 million.

MyGate offers an eponymous mobile app that allows home residents to approve entries and exits, communicate with their neighbors, log attendance and pay society maintenance bills and daily help workers.

The startup says it is operational in 11 cities in India and has amassed over 1.2 million home customers. Its customer base is increasing by 20% each month, it claimed. The service is handling 60,000 requests each minute and clocking over 45 million check-in requests each month.

The idea of MyGate came after its co-founder and CEO, Vijay Arisetty, left the Indian armed force. In an interview with TechCrunch, he said his family was appalled to learn about the poor state of security across societies in India.

“This was also when e-commerce companies and food delivery firms were beginning to gain strong foothold in the nation. This meant that many people were entering a gated community each day,” he said.

MyGate has inked partnerships with many e-commerce players to create a system to offer a silent and secure delivery experience for its users. The startup also trains guards to understand the system.

According to industry estimates, more than 4.5 million people in India today live in gated communities, and that figure is growing by 13% each year. The private security industry in the country is a $15 billion market.

Arisetty says he believes the startup could significantly accelerate its growth as its solution understands the price-sensitive market. Using MyGate costs an apartment about Rs 20 (28 cents) per month. Even at that price, the startup says it is making a profit. “Today, we are seeing more demand than we can handle,” he said.

That’s where the new funding would come into play for the startup, which today employs about 700 people.

The startup plans to use the fresh capital to expand its technology infrastructure, its marketing and operations teams and build new features. The startup aims to reach 15 million homes in 40 Indian cities in the next 18 months.

In a statement, Sanjay Swamy, managing partner at Prime Venture Partners, said, “It’s been great to see a fledgling startup execute consistently and holistically, and grow into a category-creating market-leader.”

Amazon Pay users in India can now pay their utility, mobile and cable bills with Alexa

Amazon Pay users in India can now use voice command with Alexa to pay their utility, internet, mobile, and satellite cable TV bills, the e-commerce giant said on Wednesday. This is the first time, the company said, it is pairing these functionalities with Amazon Pay in any market.

The e-commerce giant, which competes with Walmart’s Flipkart in India, said any Alexa-enabled device such as the Echo Dot smart speaker, the Fire TV Stick dongle, or headphones from third-party vendors will support the aforementioned feature in India.

To be sure, Amazon has long allowed users in many markets to purchase items using voice command with Alexa. But this is the first time the American company is letting users pay their electricity, water, cooking gas, broadband, and satellite TV bills with voice and Amazon Pay.

Amazon Pay is available in many markets, but the service has become especially popular in India, where the concept of parking money to a digital wallet skyrocketed in usage in late 2016 after the Indian government invalidated much of the paper bills in circulation in the country.

Without disclosing specific figures, Amazon said “3X more customers” compared to last year’s event used Amazon Pay service to pay during the recent six-day festive sales. It said a quarter of all digital transactions during the event was carried out on its Pay service.

To boost Amazon Pay engagements in India, the company has offered lofty cashback on Pay on a number of purchases over the years. Users can also enjoy hefty discount if they use Amazon Pay to pay for their food, tickets, and other things on select popular third-party services.

During the holiday season, the company said, “customers booked flight tickets worth 300 trips around the earth.”

Amazon Pay makes it much more convenient for users to pay their digital purchases especially those that are recurring in nature, said Puneesh Kumar, country manager of Alexa Experiences and Devices.

The company says users can engage with Pay through voice commands like “Alexa, what’s my balance,” which will reveal the amount they have available for purchase in their Amazon Pay wallet. Users can also initiate the process of topping money to their mobile wallet using a voice command. They can say something like, “Alexa, add Rs 1000 to my Amazon Pay balance,” which will send a link as a text on their phones to complete the transaction.

True Balance raises $23M to bring its payments app to more small cities and towns in India

South Korean startup True Balance, which operates an eponymous financial services app aimed at tens of millions of users in small cities and towns in India, has closed a new financing round as it looks to court more first time users in the world’s second largest internet market.

True Balance said on Tuesday that it has raised $23 million in its Series C financing round from seven Korean investors — NH Investment & Securities, IBK Capital, D3 Jubilee Partners, SB Partners, Shinhan Capital, and existing partners IMM Investment, and HB Investment.

TechCrunch reported earlier this year that True Balance — which has raised $65 million to date including the $38 million that it closed in its previous financing round — was looking to raise as much as $70 million for this financing round.

True Balance began its life as a tool to help users easily find their mobile balance, or top up pre-pay mobile credit. But in its four-year journey, its ambition has significantly grown beyond that. Today, it serves as a digital wallet app that helps users pay their mobile and electricity bills, and offer credit to customers so that they can pay later for their digital purchases.

true balance

The startup says it has amassed over 60 million registered users in India, most of whom live in small cities and towns — or dubbed India 2 and India 3. Most of these users are coming online for the first time and True Balance says it has an army of local agents — who get certain incentives — to help first time internet users understand the benefit of online transactions and start using the app.

True Balance says it clocks more than 300,000 digital transactions on its app each day. The startup, which recently introduced e-commerce shopping service on its app to sell products like smartphones, has clocked $100 million in GMV sales in the country to date.

Charlie Lee, founder of True Balance, said the startup will use the fresh capital to bulk up the offerings on the app. Some of the features that True Balance intends to add before the end of this fiscal year include the ability to purchase bus and train tickets, digital gold, and book cooking gas cylinders.

True Balance will also expand its lending and e-commerce services, Lee said. Its lending feature was used 1 million times in three months when it was introduced earlier this year. “We aim to strengthen our data and alternative credit scoring strategy to provide better financial services to our target — the next billion Indian users. Our goal is to reach 100 million digital touch points and become one of the top fin-tech companies in India by 2022,” he added in a statement.

Even as more than 600 million users in India are online today, just about as many remain offline. In recent years, many major companies in India have started to customize their services to appeal to users in India 2 and India 3 — who also have limited financial power.

India’s Reliance Jio unveils video call assistant to help businesses automate customer support

Before Google moves to bring its human-sounding robot calling service Duplex to help users automate their interactions with businesses to international markets, an Indian giant is deploying its own solution to get a jumpstart on the local market.

Reliance Jio today unveiled AI-powered Video Call Assistant service that will allow businesses to automate their customer support and other communications. The service, built in collaboration with Radisys, a U.S.-based subsidiary of Reliance Industries, can be accessed via a 4G phone call and does not require installation of any additional app, Jio said.

Executives of Reliance Jio demonstrated the technology on Monday at the third installment of Indian Mobile Congress, similar to but not affiliated with the trade show Mobile World Congress. They said they have already courted a number of customers for this service, including HDFC Bank.

In the demo, a user dials a regular phone number and sees a video chat option. Once tapped, the user is greeted by a pre-recorded video message from a human. To demonstrate the AI’s capabilities, an executive of Reliance Jio asked the bot what was the interest rate on personal loans. The human-looking bot was able to answer the question without any delay.

The company, which became the largest telecom operator in India in three years, is also offering audio and text bot options to brands, executives said. “It may be a large business or small, our bot service is built for all,” one of the two executives said.

reliance jio video bot

Image: Manish Singh / TechCrunch

The company said its developer toolkit — called Jio Bot Maker — will allow brands to build and deploy the AI assistant in “just five minutes.”

The company is hoping to address the “current customer pain points like endless call-hold music or seemingly never-ending IVR wait-times,” it said, as it looks to court more businesses in the country.

Earlier this year, Reliance Jio inked a deal with Microsoft to bring Office 365 and other services from the Redmond-headquartered giant to small businesses in India for subsidized cost.

The company has also developed a point-of-sale machine that its agents are increasingly trying to sell to neighborhood stores in the nation. Popularly known as kirana stores, these millions of mom and pop shops dot the entire country.

Reliance Industries, parent firm of Reliance Jio and the largest industrial house in the nation, also operates the largest retail chain in the country, called Reliance Retail. Despite billions of dollars spent on India’s e-commerce market, online sales still amount for just 3% of the overall sales in the nation, according to industry estimates.

The person who appears on the video chat could be replaced by anyone from the CEO of a company to a brand ambassador, Reliance Jio said. “We aim to democratize AI by enabling small businesses to create their own AI-based Bot with no coding and with minimal effort,” it added.

The company plans to introduce support for multiple languages to its bot service and serve “millions of businesses” across various industries in India.

Jio did not reveal when it plans to launch the developer kit to the public, but a spokesperson told TechCrunch that it will be made available “in the near future.”

Jio has made no secret that it wants to develop AI assistants to help businesses. Last year, it acquired Haptik, a Mumbai-based startup that develops “conversational” platforms and virtual assistants. The size of the deal was $100 million.

Aakrit Vaish, co-founder and CEO of Haptik, told TechCrunch in an interview earlier that the startup was developing voice bots.

Club Factory raises $100M to expand its lifestyle e-commerce platform in India

Club Factory, a Chinese e-commerce platform that sells fashion and beauty items and electronics accessories, has raised $100 million in a new financing round as it looks to expand its footprint in India.

The new financing round — Series D — was led by Qiming Venture Partners, Bertelsmann, IDG Capital “and  other Fortune 500 companies from the U.S. and Asia,” the five-year-old Hangzhou-headquartered startup said. Club Factory, which raised $100 million in its previous financing round early last year, has raised about $220 million to date.

Club Factory has amassed more than 70 million users on its platform, of which about 40 million live in India. The startup cited figures from app analytics firm App Annie to claim that Club Factory is now the third-largest e-commerce platform in India, surpassing once a market-leader Snapdeal.

Club Factory does not charge local sellers any commission fee, incentivizing them to cut down the cost of their items and expand offerings. The number of sellers on its platform in India has grown by 10X in the last six months, the startup claimed. Club Factory, which has about 5,000 sellers in India, plans to double that figure by year-end, it said.

club factory india

A screenshot of Club Factory’s homepage

“At the same time, we have also pioneered to strengthen the ‘store-within-platform’ concept in India’s e-commerce industry, allowing direct contact between buyers and sellers through our application,” said Vincent Lou, co-founder and chief executive of Club Factory, in a statement.

He added, “We have changed the status of the Indian e-commerce industry that monopolized information of buyers and sellers, allowing SMEs to own their customers and run their business better. All this, combined with our strategy to reduce the transaction costs of buyers and sellers and allow more local players to enter the ecosystem, has worked very well for us in India.”

The startup said in the coming months it will also bulk up more items on its platform and introduce new product categories.

India’s Vahdam Teas raises $11M to grow its tea-commerce business in the US and Europe

Vahdam Teas, an India-based e-commerce startup that sells fresh tea in international markets, has closed a new financing round as it looks to expand its presence in the U.S. and Europe.

The three-year old startup said it has raised $11 million in its Series C financing round. The round, which according to a person familiar with the matter valued the startup at about $40 million, was led by Sixth Sense Ventures. Existing investor Fireside Ventures, which has put money in a number of consumer-facing brands, also participated in the round.

Mankind Group Family office, Infosys co-founder Kris Gopalkrishnan, SAR Group Family office, Zomato co-founder Pankaj Chaddah, and Urmin Group family office also participated in the new financing round. The startup, headquartered in New Delhi and New York, has raised about $16 million to date.

The startup was founded by 28-year-old Bala Sarda, who comes from a tea industry family. Vahdam Teas operates an eponymous e-commerce platform and also works with giants such as Amazon, to sell tea directly to consumers in the U.S., Europe, and other international markets.

Vahdam Teas cuts the middlemen suppliers to reduce the time it takes to ship tea to consumers. “If you look at the supply chain for exporting from India, it’s completely broken. The goods go through distributors, then sold to exporters. Somewhere in the middle, brokers show up, too. Then an importer imports the tea. It all takes months to get a supply cycle to reach consumers. Unlike wine or whiskey, tea is best when it is fresh. Its ingredients lose flavor with time,” he explained.

To address this, Vahdam Teas has built a supply chain network to source tea directly from hundreds of gardens in India. It stores all the goods in its warehouses in New Delhi and then exports directly to its entities in different markets. The faster delivery of tea and better control of the supply chain is one of the key differentiating factors for Vahdam Teas.

Today about 99% of its sales comes from outside of India, said Sarda, who noted that with the new capital the startup would explore expanding its business in India, too.

But much of the fresh capital would be invested in bulking up its supply chain network and set up additional offices in the U.S. and Europe, he said in an interview with TechCrunch earlier this week. The startup also plans to launch new products and enter new markets in South Asia and UAE.

Vahdam Teas also wants to have presence in the offline (brick and mortar) market, and bring its tea to 500-700 stores in the U.S. in the coming months. “We have aspirations to become an omni-channel brand,” he said.

India controls about 25% of tea production worldwide. But Indian brands almost have a “negligible presence” on the world map, said Nikhil Vora, founder and chief executive of Sixth Sense Ventures. “Vahdam is an interesting example of how a traditional business like tea can get disrupted. We’re impressed with the way Bala has sought to target the global markets first and create a brand salience and market innovative ethnic Indian tea flavours,” he added.

Tea is one of the biggest industries for laborers in India. Sarda said the startup donates 1% of its revenue to help these workers educate their children.

Amazon, Walmart confront India’s slowing economy as holiday season growth stalls

Even India’s biggest festive season, featuring blinding marketing blitzkrieg and heavy discounts from Amazon India and Walmart’s Flipkart, has failed to escape the pains of slowing economy.

Online retailers in India sold goods worth $3 billion in the six-day festive sale that concluded last week, growing at an impressive 30% since last year, according to research firm RedSeer. The catch? A year before, the growth rate stood at 93%.

Forrester projected online retailers in India to generate about $4.8 billion in sales between September 25 and October 29. Satish Meena, an analyst at the research firm, said about 80% of these projected sales — $3.84 billion — were expected to occur between September 29 and October 4.

For Amazon India, which has invested more than $5.5 billion in the nation, RedSeer’s findings are more troublesome. According to the research firm’s estimate, Flipkart — together with e-commerce businesses Jabong and Myntra that it owns — commanded 63% of the market share during the festive season. Amazon India settled with just 22%.

An Amazon spokesperson in India declined to comment on the finding, but expressed concerns with the way RedSeer conducts its surveys. The spokesperson said these “speculative reports … lack robust and credible methodology.”

Amazon India did not share its internal findings, but volunteered to cite a Nielsen’s survey of 190,000 users in 50 cities. Per Nielsen, Amazon commanded 51% of all transactions during the festive sales, 42% of all orders, and 45% of all “value.”

The spokesperson added that “this event has been our biggest celebration ever.” The company received orders from 99.4% zip codes in India, and saw participation of over 65,000 sellers from 500 cities. “Over 88% new customers came from small towns,” the spokesperson said.

Flipkart did not respond to a request for comment.

Many in India have been watching the e-commerce sales as a test to see if it could kickstart the slowing consumer spending in the nation. The sales, leading up to the Hindu festival of Diwali, has traditionally been the season of lavish and reckless consumption in India.

And for Amazon and Walmart, a lot was riding on this festive season. The first half of this year has been slow for Amazon and Flipkart in India, said Meena. The e-commerce giants were subjected to disruptive changes in local e-commerce policy earlier this year, which forced both to delist hundreds of thousands of goods overnight from their marketplaces.

At a conference last week, U.S. Secretary of Commerce Wilbur Ross expressed concerns over some of India’s recent regulatory changes, saying that India has become one of the most protectionist nations in the world. Indian newspaper The Economic Times reported last week that Amazon had cut investment in its India business by a third this year. Citing the report, Ross said disruptive policy changes influence the way global giants see the Indian market.

But disruptive policies is only one of the causes of concerns for international giants. India’s economy has slowed to a six-year low. Forrester’s Meena said the sales last week was the time when both Amazon and Flipkart could have bounced back. According to industry reports, e-commerce businesses generate nearly a third of their annual sales in India during this festive season.

But even as the growth rate has slowed down, Meena said the fact that both these companies along with other online retailers were able to generate so much sale is good news for them.

“Overall 2019 has been a slow year for e-commerce,” he told TechCrunch in an interview. “Two things are clear, though. One is that there remains a big opportunity for e-commerce in India. Second, consumers from smaller cities and towns are increasing their online spending.”

In the meantime, both Amazon and Flipkart have steered clear of sharing any meaningful internal data. Flipkart said that its marketplace had registered “2X sales growth.” The company said it had seen “3X transaction growth” and electronics grew over “70% from tier 2+ cities.” Amazon said “fashion grew 5X” and beauty items saw “7X” jump in sales.

The companies have never disclosed exact figures, so it is impossible to fathom how one should assess this growth.

Google-backed Dunzo raises $45M to expand its hyperlocal delivery startup in India

An Indian startup that is increasingly posing a threat to established food and grocery delivery businesses and e-commerce giants just closed a new financing round to expand its business in the nation.

Bangalore-based Dunzo said today it has raised $45 million from Google, Lightbox, STIC Ventures, and 3L Capital. The new financing round — dubbed Series D — valued the four-year-old startup at about $200 million, three people familiar with the matter told TechCrunch. The startup has raised $81 million to date.

Dunzo operates an eponymous hyper-local delivery service. Users get access to a wide-range of items from grocery, perishables, pet supplies, medicines to dinner from their neighborhood stores and restaurants.

But that’s not all. You can have Dunzo pick up and deliver anything in a city. Forgot your laptop charger at home? Dunzo can take care of it. Part of the service’s charm is that its delivery is fast (most of its deliveries take under 25 minutes) and as long as the store is not very far away, it’s not going to cost you more than a $1.

Dunzo is currently operational in eight Indian cities: Bangalore, Delhi, Noida, Pune, Gurgaon, Powai, Hyderabad, and Chennai. The startup said it will use the fresh capital to expand its technology infrastructure and develop partnerships with small and medium businesses.

dunzo hq techcrunch

Dunzo founders told TechCrunch that food category already accounts for a quarter of all deliveries the service processes. As the service scales, it is increasingly becoming a competitor to food delivery startups such as BigBasket, Swiggy, and Zomato.

In recent months, Dunzo has also started to test delivery of smartphones and other products. The startup recently quietly began to deliver Xiaomi smartphones to users in select parts of India. Unlike Amazon or Flipkart, that take a day or two to deliver an item, Dunzo was getting the new phones to users in 30 minutes. Dunzo has tested a similar partnership with Puma, executives told TechCrunch.

In an interesting turn of events, last month Swiggy announced Go, a service that allows users in select cities in India to deliver any kind of product — not just food, thereby entering Dunzo’s territory.

More to follow shortly…

India’s Fyle bags $4.5M to expand its expense management platform in US, other international markets

Fyle, a Bangalore-headquartered startup that operates an expense management platform, has extended its previous financing round to add $4.5 million of new investment as it looks to court more clients in overseas markets.

The additional $4.5 million tranche of investment was led by U.S.-based hedge fund Steadview Capital, the startup said. Tiger Global, Freshworks, and Pravega Ventures also participated in the round. The new tranche of investment, dubbed Series A1, means that the three-and-a-half-year old startup has raised $8.7 million as part of its Series A financing round, and $10.5 million to date.

The SaaS startup offers an expense management platform that makes it easier for employees of a firm to report their business expenses. The eponymous service supports a range of popular email providers including G Suite and Office 365, and uses a proprietary technology to scan and fetch details from emails, Yash Madhusudhan, co-founder and CEO of Fyle, demonstrated to TechCrunch last week.

A user, for instance, could open a flight ticket email and click on Fyle’s Chrome extension to fetch all details and report the expense in a single-click in real-time. As part of today’s announcement, Madhusudhan unveiled an integration with WhatsApp . Users will now be able to take pictures of their tickets and other things and forward it to Fyle, which will quickly scan and report expense filings for them.

These integrations come in handy to users. “80%-90% of a user’s spending patterns land on their email and messaging clients. And traditionally it has been a pain point for them to get done with their expense filings. So we built a platform that looks at the challenges faced by them. At the same time, our platform understands frauds and works with a company’s compliances and policies to ensure that the filings are legitimate,” he said.

“Every company today could make use of an intelligent expense platform like Fyle. Major giants already subscribe to ERP services that offer similar capabilities as part of their offerings. But as a company or startup grows beyond 50 to 100 people, it becomes tedious to manage expense filings,” he added.

Fyle maintains a web application and a mobile app, and users are free to use them. But the rationale behind introducing integrations with popular services is to make it easier than ever for them to report filings. The startup retains its algorithms each month to improve their scanning abilities. “The idea is to extend expense filing to a service that people already use,” he said.

International expansion

Until late last year, Fyle was serving customers in India. Earlier this year, it began searching for clients outside the nation. “Our philosophy was if we are able to sell in India remotely and get people to use the product without any training, we should be able to replicate this in any part of the world,” he said.

And that bet has worked. Fyle has amassed more than 300 clients, more than 250 of which are from outside of India. Today, the startup says it has customers in 17 nations including the U.S., and the UK. Furthermore, Fyle’s revenue has grown by five times in the last five months, said Madhusudhan, without disclosing the exact figures.

To accelerate its momentum, the startup is today also launching an enterprise version of Fyle that will serve the needs of major companies. The enterprise version supports a range of additional security features such as IP restriction and single sign-in option.

Fyle will use the new capital to develop more product solutions and integrations and expand its footprint in international markets, Madhusudhan said. The startup, which just recently set up its sales and marketing team would also expand the headcount, he said.

Moving forward, Madhusudhan said the startup would also explore tie-ups with ERP providers and other ways to extend the reach of Fyle.

In a statement, Ravi Mehta, MD at Steadview Capital, said, “intelligent and automated systems will empower businesses to be more efficient in the coming decade. We are excited to partner with Fyle to transform one of the core business processes of expense management through intelligence and automation.”