Zomato acquires TechEagle

Online food delivery company Zomato has acquired TechEagle Innovations, a Lucknow based startup that works exclusively on drones. TechEagle will help Zomato move towards offering drone based food delivery in India, by creating a hub-to-hub delivery network powered by hybrid multi-rotor drones.

TechEagle was founded in 2015 by IIT Kanpur alumni. It works with a prime focus on custom-made drones capable of carrying up to 5 kg payloads. It is worth mentioning that the Ministry of Civil Aviation (MoCA) recently legalized flying commercial drones and also announced a policy called Drone Regulations 1.0. While these guidelines banned the use of drones for delivery of goods and food, on September 19, minister of state for civil aviation hinted at including a clause on the application of drones for ecommerce and food delivery in the draft Drone Regulations 2.0.

India is currently in the early stage of aerial innovations and is taking baby steps towards building a future where users can expect a drone to deliver the food they ordered online. Zomato currently delivers 22 Mn monthly orders and is leaving no stone unturned as far as last-mile delivery is concerned. The company boasts a last-mile delivery fleet of 1.5 lakh partners and has over 75,000 restaurant partners offering food delivery services across 100 cities in India.

So far, Zomato has made 12 acquisitions globally. In the last two years, Runnr (September 2017) and TongueStun ($18 Mn, September 2018) have been its prime acquisitions aimed at boosting its food delivery and logistics network. Other startups acquired by Zomato include MapleGraph, Sparse Labs, NexTable, Mekanist, Urbanspoon, Cibando, LunchTime, Obedovat, Menu Mania, and gastronauci.pl.

Elite SEM Acquires CPC Strategy

Elite SEM has acquired CPC Strategy, the San Diego based agency known for its expertise in retail, ecommerce and specifically the Amazon Channel, where it expects to drive more than half of its revenue in 2018. The combination with CPC Strategy adds critical scale to Elite’s rapidly growing Amazon practice, bolsters the depth of its expertise in search and social and also delivers a powerful technology asset in CPC strategy proprietary CAPx media and bid optimization platform.

CPC Strategy, with a team of over 125 employees, works with both brands and sellers and provides services including strategy and advisory, media planning and placement, creative and content services, and data and analytics. Clients include Pfizer, Reef, and Guthy Renker, The Honest Company, Hallmark, Nestle, Comvita, Riddell, Unilever's Seventh Generation, and Nutrisystem, as well as many Amazon-only sellers.

The combined entity will have approximately 500 performance media specialists, integrated media strategists, and data scientists. Both companies have a deep commitment to creating the best possible work environment, based on meritocracy, resulting in superior client service and retention. The acquisition follows Elite SEM's 'Experts Only' operating model, which maintains and develops specialization around each practice area while bringing a holistic approach to clients through Integrated Media Strategy and Marketing Science.

The acquisition includes CPC Strategy's proprietary Amazon media and bid optimization platform, CAPx, which provides a substantial competitive advantage through both efficiency and efficacy gains, resulting in superior service and performance gains for their clients. While Elite SEM will continue to work with industry partners and third-party technology, this proprietary solution enables strategy and service teams to address market gaps and provide the best platform recommendation for clients.

Flipkart buys AI startup Liv.ai

India’s largest e-commerce firm Flipkart has acquired artificial intelligence (AI) startup Liv.ai, which has built a platform that translates speech to text in 10 Indian languages. The acquisition comes at a time when large online retail firms are doubling down and investing heavily on getting access to the next 100 million Internet users in tier-2 and tier-3 cities and towns across India.

After the acquisition is completed, Liv.ai will be integrated into Flipkart Center of Excellence for Voice Solutions, as it looks to leverage the startup’s technology and build its capabilities around so-called conversational shopping. For Flipkart, this buyout is crucial as it potentially helps the online retailer overcome the language barrier problem, an issue faced by most leading consumer internet companies.

Flipkart’s arch-rival Amazon.com Inc. has also bet on voice and speech-recognition technology globally and come out with new offerings in the form of AI-powered virtual assistant Alexa. Liv.ai is one of a handful of startups to build technology that converts speech to text in 10 Indian languages that include Hindi, Bengali, Punjabi, Marathi, Gujarati, Kannada, Tamil, Telugu and Malayalam. Prior to being sold to Flipkart, the startup had raised funding from investors such as Astarc Ventures.

Adobe to acquire Magento

Adobe plans to get into the online shopping business by paying $1.68 Billion for e-commerce Company Magento commerce. Adobe is known for its Photoshop tools. But it’s quickly expanding into other businesses as it looks for new areas of growth.

Companies like Canon and designer Paul Smith use Magento’s technology to operate their online stores. Both Adobe and Magento share similar customers like Warner Music Group, Coca-Cola, and Nestlé, Adobe said. Having similar customers is significant because Adobe can better cross-sell its various tools and services.

Magento, founded in 2007, was acquired for an undisclosed amount by eBay in 2011. A few months after eBay split with digital payment processing company PayPal in 2015, eBay sold its enterprise software unit, including Magento, to investors Sterling Partners and Permira Funds for $925 million. Last year, Magento raised $250 million from Chinese investment firm Hillhouse at a reported private valuation of $700 million.

Salesforce is the 10,000-pound gorilla in this space with revenue across its various clouds reaching more than $8 billion last year. The company is on a run rate to exceed $10 billion in 2018. It has set a long-term company goal to reach $60 billion in annual revenue by 2034.

Wal-Mart to buy Jet.com

Wal-Mart stores Inc. agreed to buy e-commerce startup Jet.com Inc. for about $3 Billion in cash, giving the world’s largest retailer the resources for a stronger shopping website to compete with Amazon.com Inc. the online market leader.

The deal also includes $300 Million in Wal-Mart shares that will be paid over time. Acquiring Jet.com, which achieved a $1 Billion gross merchandise run rate in a little more than a year, gives Wal-Mart a website that processes an average of 25,000 orders a day and is adding 400,000 shoppers monthly.

Wal-Mart has spent billions expanding its online operation, including hiring thousands of workers, opening two offices in Silicon Valley and building large e-commerce distribution centers. It also started an annual subscription service similar to half the price to Amazon Prime. Amazon’s $99 a year service provides free two day shipping on millions of items, encouraging shoppers to stay on the website, as well as the company’s video entertainment offerings.

Hoboken, New Jersey based Jet.com has distinguished itself in e-commerce through “gain sharing” luring buyers to add items to their orders to reduce shipping costs, and to pay with debit instead of credit cards to reduce transaction fees. Traditional store based mass retailers such as Wal-Mart, Target Corp. and Costco Wholesale Corp. have been struggling to lend off Amazon’s momentum in online shopping.

Roadrunnr acquires TinyOwl

Hyperlocal delivery start-up Roadrunnr has acquired Food Ordering firm TinyOwl Technology Pvt. Ltd and has transitioned into a food ordering and delivery platform. It has also rebranded itself is Runnr.

After its acquisition of TinyOwl, the company has decided to reposition itself as a customer centric platform and launched a full integrated app called Runnr which is now available on the iOS and Google play store. Roadrunnr and TinyOwl have common investors in Sequoia Capital and Nexus Venture Partners.

Runnr food ordering app is currently live in South Mumbai with over 150 Restaurants. There is no minimum order size and the app offers live tracking of delivery. Roadrunnr may exit the business of delivering products for e-commerce companies and focus on a few select categories such as food, groceries and merchant-to-merchant or first mile deliveries.

The food delivery and takeaway market in India was pegged at $12.8 Million in 2014, however the actual penetration level has been only 0.7%. Around 27% of the 40 Million online shoppers order food online and the takeaway market is four times the delivery market.

Amazon to buy Emvantage Payments

Online marketplace Amazon said it will buy online payments firm Emvantage Payments Pvt. Ltd. to develop India specific payments solution. The announcement comes shortly after Amazon infused an additional Rs. 1696 crore into its India Unit (Amazon Seller Services Pvt. Ltd) in December 2015, to take on local rivals Flipkart and Snapdeal.

Large e-commerce companies have made significant investments, acquisitions and partnerships with payment companies to claim a share of the fast growing digital payments vertical which helps reduce the dependency on cash and make it convenient for online shopping. The Indian e-commerce market is estimated to grow to $100 Million by April 2020. Emvantage employees will join Amazon payments team.

Jasper Info Tech Pvt. Ltd. run online marketplace Snapdeal launched its mobile wallet through its utility payments unit FreeCharge in September 2015. The company had set aside Rs. 1000 crore towards cash back offers and discounts among other initiatives to attract more consumers to FreeCharge Digital Wallet. Snapdeal had acquired FreeCharge for $450 Million in April 2015.

Flipkart had acquired payments services company FX Mart Pvt. Ltd. in August 2015. ANI Technologies Pvt. Ltd. cab aggregator Ola had made its Ola Money digital wallet Available for making payments in other e-commerce platforms. 

Snapdeal Acquires Reduce Data

India’s second largest e-commerce firm Snapdeal.com has acquired Reduce Data, a US-based advertising platform, for an undisclosed amount as online retailers bet on advertising to become a popular key business. Snapdeal has signed an acquihire deal, a deal done primarily for expertise of the acquired firm staff.

Reduce Data helps brands to deliver advertising strategies for consumers across platforms and devices. The company claims that its platform leverages artificial intelligence, real-time data and other tools, delivering high return on investment for advertising campaigns. The company currently has customers across US, UK and India.

Most large e-commerce firms, including Flipkart and Snapdeal, are trying to build large advertisement sales teams and improving their technology to show ads based on data collected on the shopping habits of millions of Indians. Ad revenues are expected to provide a much needed boost to margins for e-retailers and create an additional large revenue stream for them.

Flipkart acquired AdIQuity Technologies, a mobile advertising technology firm in March in a move to improve its ad platform. Globally too e-commerce firms get significant chunk of revenues from ads. Acquisition of Reduce Data by Snapdeal is the company latest push into strengthening its advertising business. The company introduced ads on platform in May 2014.

Airtel Acquires YTS Solutions

Bharti Airtel Ltd has acquired financial solutions firm YTS Solutions for an undisclosed amount and announced appointment of the latter co-founder Manish Khera as CEO of its mobile wallet service Airtel M Commerce Services. The acquired business will be integrated with the operations of Airtel Money Services Ltd.

Based out of Mumbai, YTS has been developing financial products focused on mass market and micro-transactions. This acquisition will expand Airtel portfolio in the mobile commerce segment and bring in a host of new product capabilities targeted at migrants in urban cities and their families in rural towns and villages.

The acquisition, the first such by an Indian Telco in the mobile commerce segment, will help in expanding the portfolio of Airtel Money, a mobile wallet, even as the Telco awaits the Reserve Bank of India decision on its application for a payments bank license. The acquisition is the first of its kind among Telecom service providers who offer mobile wallets.

In 2011, AMSL announced the launch of Airtel Money and in January 2015, it applied for a Payment Bank License. Airtel, India’s largest mobile operator with a customer base of over 230 Million, covers 430,000 towns and villages backed by 1.5 Million distribution outlets. Other Telecom providers such as, Vodafone has M-Pesa, Idea Cellular has Idea Money and Tata Teleservices has MRupee, and all of them compete with the likes of Paytm, MobiKwik, PayU and Oxigen for a share of the fast growing mobile commerce pie.

Flipkart acquires Appiterate

E-commerce major Flipkart has been very clear about its mobile only strategy and in order to strengthen its presence in the area of mobile technology, it has acquired a New-Delhi based mobile engagement and marketing automation company Appiterate. This is Flipkart third acquisition of this year.

Appiterate helps E-commerce companies target customers better through push notifications and in-app messages. The funding team has a strong experience in the mobile app space and has in the past built mobile apps for companies such as Microsoft, Zomato, Groupon, Sears etc. In a short span Appiterate has carved out a niche in the industry as being one of the most disruptive companies in its space.

Flipkart is planning to go mobile-only within a year. Following the announcement that Myntra will shut down its website on May 1, Flipkart had said the E-commerce firm will too shift to an app only model within a year as traffic from mobile had grown nearly 10 times in just 12 months. Flipkart has been persistently looking to improve and expand its mobile app capabilities and plans to invest in and acquire other companies in this domain.

After this acquisition, Appiterate mobile marketing automation platform will be integrated into Flipkart mobile app to help in precise targeting of users based on their activity on the app and website. Appiterate has raised money from institutional investors like SAIF partners and angel investors.

Snapdeal in talks to buy Komli

A major acquisition in the mobile advertising space seems only a matter of time as e-commerce players flex their financial muscle to bring in the next piece of their jigsaw puzzle. Sources indicate that the likes of Flipkart, Snapdeal, Amazon, and Shopclues, are all in the market for acquisition. The target seems to be broadly divided in two categories – mobile tech and mobile banking.

Online retailer Snapdeal is in advanced talks to acquire Komli Media in a deal that values the ad technology company at about $300 Million, the same as when it raised funds from investors. The deal will give Snapdeal engineering capabilities in Bengaluru as it battles Flipkart, as well as it notch up advertising revenues by selling space on the e-commerce site. Snapdeal had an estimated 79.8 monthly visitors in February and Flipkart had 110.5 Million.

Flipkart recently made clear its plans to sell advertising on its platform. The ecommerce firm also acquired ad technology company AdIQuity. Komli was founded by Amar Goel in 2006 and has raised $97 Million in five rounds of funding from investors including Nexus Ventures Partners and Peepul Capital. It employs nearly 300 people across India and started as a digital advertising network – buying and selling advertising inventory online in Asia Pacific.

Goel also set up Pubmatic, focused on technology for online advertising in the US in 2008. InMobi, another ad network based in Bengaluru, was founded a year later and went on to raise $200 Million from Japan Softbank. Driven by increased spending by ecommerce companies, India’s online advertising market is set to grow by 30% this financial year to reach a total size of Rs 3,575 crore. 

Klarna Eyes Indian Shoppers

Klarna is a Sweden based e-commerce company that provides payment services for online storefronts. Their core service is to assume store claims for payments and handle customer payments, thus estimating the risk for seller and buyer. About 20% of all e-commerce sales in Sweden go through Klarna. The company has stores in seven countries in Europe. There is an office in Israel, which focuses on Research and Development.

European payment provider, which allows consumers to make online purchases using only their e-mail address and postcode with no registration or credit cards, is exploring the possibility of setting up business in India. The Stockholm based company is currently valued at around $1 Billion and active in 16 countries. The company was founded in 2005 by three students at Stockholm school of Economics and has 1,100 employees across the countries, which has its operations.

Klarna integrates the payment methods promising to make online shopping easier. About 35 Million customers have shopped from Klarna and company has 50,000 merchants. The company is focusing on removing friction and hassles from online buying. For using Klarna, there is no need to create an account or a password. Customers can shop using only their email address and postcode. The customers then confirm the purchase before choosing a payment method. Klarna has also introduced Pay after delivery as a Payment option, where the customer has 14 days to pay. This means the customer gets their goods and can make sure they are ok before paying. For this, Klarna gives full guarantee to the customers as well as merchants.

For every purchase, the company also performs a swift background check on customer information based on the speed at which they type their email address and postcode. Klarna claims to be the one of the fastest growing e-commerce companies in Europe and having a 10 percent market share of e-commerce in Northern Europe. Klarna is active in Austria, Belgium, France, Germany, Hungary, Italy, the Netherlands, Poland, Spain, Switzerland, the UK, and the US.

DHL to test e-commerce model in India

DHL is a division of the German Logistic company Deutsche Post DHL providing international express mail services. DHL is the world market leader in sea and airmail. It was founded in 1969 to deliver documents between Honolulu and San Francisco. DHL is serving in countries such as Iraq, Iran, China, Vietnam, North Korea, and Soviet Union. Deutsche Post DHL has chosen India to pilot its e-commerce business model for Asia-Pacific region and will invest more than €100 million in country over the next two years to create infrastructure.

Globally, e-retail is rapidly evolving. Over the next five years, the global e-commerce sector is expected to grow by more than 10% per annum. Asian region is expected to surpass North America and Europe as the biggest online market in the world. It is a huge opportunity for DHL to become the world’s largest provider of e-commerce logistics. Over 20 online retailers including Flipkart, Snapdeal, Urban Ladder, Fashionandyou, and LimeRoad have venture capital funds in the past four months. More are in talks to raise funds in the next six months.

Flipkart rising revenues, its acquisition of Myntra, the rise in shopping on smartphones and the change of government centre aided in attracting investors. The hype around the Initial Public Offering (IPO) of Chinese e-commerce company Alibaba has revived hope that if China can come up with large e-commerce businesses, so can India. Online retail is estimated to grow to $22 Billion in five years. DHL is present in 220 countries with 315,000 employees. DHL holds 75% stake in India listed small parcel transportation firm Blue Dart Express.

DHL will start 15 e-fulfillment centres to facilitate e-commerce business in metros including New Delhi, Bangalore, and Mumbai. There are also plans to start such centres in Tier-II and Tier-III cities including Coimbatore and Jaipur. DHL is specialized in providing integrated logistics solutions. DHL and Blue dart are moving away from vanilla transportation to specialized and Integrated Service.