/ETtech Evening Briefing on Feb 8, 2021: SoftBank’s turnaround; Tesla’s $1.5 billion crypto bet

ETtech Evening Briefing on Feb 8, 2021: SoftBank’s turnaround; Tesla’s $1.5 billion crypto bet

Good evening,

VerSe Innovation has bagged over $ 100 million in fresh funding; SoftBank Vision Fund has racked up a record $ 8 billion profit in the third quarter; and taking a cue from its founder Elon Musk, Tesla has bet big on Bitcoin.

Here’s a look at the top tech news today.

1. Parent of DailyHunt and Josh lands $ 100 million

VerSe Innovation

Since India banned TikTok in June 2020, a host of Indian short-video apps have sought to capture a market that no-one knew existed before TikTok revealed it. One of these is Josh, owned by VerSe Innovation, which has now raised more than $ 100 million in a Series H funding round led by Qatar Investment Authority and Glade Brook Capital Partners. VerSe also owns news aggregator DailyHunt. Canaan Valley Capital and existing investor Sofina Group also participated in the fundraise.

This comes on heels of VerSe Innovation landing more than $ 100 million from Google, Microsoft and Falcon Edge’s Alpha Wave Incubation in December, pushing its valuation past $ 1 billion.

The story so far: While homegrown short video apps are yet to achieve the success the TikTok did in India, consolidation is likely on the cards for the sector as several players like Chingari, Bolo Indya and Trell have seen a significant decline in their rankings on the Google Play Store while those like Josh, Times Internet’s MX Takatak (full disclosure: Times Internet also owns ETtech), and ShareChat’s Moj have remained among the most downloaded apps in the past few months.

short video

Graphic: Rahul Awasthi

Short-Video Apps

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Other deals of the day

Edtech startup Newton School picked up $ 5 million in its Series A round of financing, led by RTP Global. The funding saw participation from existing investors Nexus Venture Partners, Prophetic Ventures and Unacademy co-founders Gaurav Munjal, Roman Saini, and Hemesh Singh. Flipkart’s CEO Kalyan Krishnamoorthy, CRED’s Kunal Shah, Freshworks’ Girish Mathrubootham, Udaan’s Sujeet Kumar and Razorpay founders Harshil Mathur and Shashank Kumar, along with a slew of angel investors, also participated in the round.

Paytm founder Vijay Shekhar Sharma and co-working space provider Innov8 CEO Ritesh Malik have invested Rs 1.5 crore in eight-month-old company Supersourcing.

2. SoftBank rises from ashes of WeWork

SoftBank Vision Fund unit rebounded from a loss to record an $ 8 billion profit in the third quarter.

A year since WeWork sale: This comes a year after the lukewarm IPO of office-sharing firm WeWork and the Covid-19 pandemic forced SoftBank Group Chief Executive Masayoshi Son to sell off assets and shore up his company’s crumbling market value.

“Our vision never changed,” Son told a news conference in Tokyo after his company announced its latest results. “Golden eggs are not produced by chance,” he added, returning to a favoured analogy that describes SoftBank as a goose that backs fast-growing companies such as Alibaba that are its golden eggs.

What changed: A rally in tech stocks has aided the turnaround at the Japanese conglomerate’s Vision Fund unit. Softbank said unrealised gains in Doordash, a US-based food delivery service that went public in the quarter, amounted to $ 10.7 billion.

3. Tesla’s big Bitcoin bet


Tesla founder Elon Musk

Tesla has acquired $ 1.5 billion worth of Bitcoin, the company said in a filing with the US Securities and Exchange Commission (SEC).

“Alternative reserve assets”: “In January 2021, we updated our investment policy to provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity,” the company said in a filing.

“As part of the policy, which was duly approved by the Audit Committee of our Board of Directors, we may invest a portion of such cash in certain alternative reserve assets including digital assets, gold bullion, gold exchange-traded funds and other assets as specified in the future.”

Buy a Tesla with Bitcoin? Why not? The electric carmaker said it expects to begin accepting Bitcoin as a form of payment for its products in the near future, subject to applicable laws and initially on a limited basis.

4. Firms commit Rs 500 crore to social security fund

More than a dozen companies including Amazon, Flipkart, Swiggy, Ola and Uber have committed about Rs 500 crore to the government’s proposed social security fund that will provide health insurance to one million gig workers, a top official told ET.

The labour ministry has finalised the scheme for gig workers under the Employees’ State Insurance Corporation, which will be announced alongside the rollout of the Social Security Code.

Why it matters: Gig workers covered under the scheme will be eligible for medical, maternity, disability and other benefits and would have access to ESIC hospitals. The labour ministry is ready with the rules under the four labour Codes, which will be notified soon, the official said.

Not for everyone: The white-collar gig workforce, often referred to as freelance consultants, will not be among the beneficiaries in the first year of the scheme.

5. HCL’s Rs 700-crore bonus

HCL Technologies, the country’s third-largest software services firm, is offering a one-time bonus to its over 1.5 lakh employees worth Rs 700 crore to mark the milestone of the company’s top line touching the $ 10 billion.

The special bonus will be paid to employees in February 2021, amounting to approximately $ 90 million-plus payroll taxes in some countries, the impact of which is excluded from the FY21 EBIT guidance provided by the company last month. In celebration and gratitude, all employees with one year of service or greater will receive a bonus, the equivalent of 10 days’ salary.

(Illustrations and graphics by Rahul Awasthi)

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