SRI Capital invests US$1 million in FakeSpot
 
 
Early stage capital for global innovation
Focused on tech startups in the US and in India
 
 
NEWSLETTER - November, 2018
 
 
SRI CAPITAL UPDATES
 
 

Providing financial access to middle income Indian households

PB Lakshmikant, our Financial Controller, talks about the current landscape for financial literacy. We believe that there is a business case for private companies in this effort and our investment in IndianMoney underscores this belief.

 
 
 
 
 
PORTFOLIO UPDATES
 
 

LetsMD raises $ 1 mn in funding from Orios Venture Partners

Healthcare-focused fintech startup LetsMD has topped up its pre-Series A funding round with an additional $ 1 mn from early-stage investment firm Orios Venture Partners.The investment is a combination of a primary and secondary transaction, including $550,000 of new equity funding.

 

SRI Capital had invested in LetsMD in April 2018. Given our conviction on the space and the founder’s ability to execute, we decided to increase our stake by providing exit to early investors.

 
 
 
 
 

VideoKen, an AI powered video-tech platform, raises $ 930,000 from SRI Capital and others

New Jersey and Bengaluru based VideoKen Inc., which runs an eponymous artificial intelligence powered video tech platform, has raised $ 930,000 from SRI Capital and Touchstone Equities with participation from Hyderabad Angels.

 

VideoKen uses AI and machine learning to summarise videos into digital textbooks which include automated indexes and glossaries for videos. As a video-based social learning solution, it helps educators and learners search, curate, personalise and share video clips. It offers educational videos that come with several features, such as finding sections that are of interest, clipping interesting parts of a video, inserting notes and sharing them with friends, among others.

 
 
 
 

Fakespot founder Saoud Khalifa was interviewed by BBC One

In a segment about fake reviews on online websites, BBC One covered Fakespot and interviewed Saoud Khalifa. According to Saoud, around 30% of the reviews posted on TripAdvisor are fake.

 
 
 
 
 
INDUSTRY UPDATE
 

Supreme Court of India issued a landmark judgement on Aadhar- In a verdict, the court upheld Aadhar constitutional validity but made linking of Aadhar for private services illegal. Aadhar was a big part of India Stack and its services were used by many startups for KYC as it was fast and cost effective. Aadhar was passed as a money bill, to ensure its passage. However, a money bill needs to be directly and primarily related to government expenditures. An architecture of private sector use does not fit within this framework.

 
 
 

With Aadhaar-based eKYC off the table, firms are finding workarounds- Indian startups have started modifying there process to adhere to the ruling, including finding workabouts. However, these workabouts are not cost-effective yet. In Betterplace’s case, 'The cost of KYC per person has gone up from Rs. 10 (~$ 0.14) to Rs. 60 (~$ 0.82) for background verification players such as Betterplace etc.'

 
 
 

The vernacular content landscape in India is heating up- Recently, Shunwei capital led a $ 100 mn investment in Sharechat with other players like DailyHunt, InShorts and ClipApp also raising significant funding. ByteDance, the world’s most highly valued startup, has entered India and has acquired 2.5 mn DAUs (compared to 7.5 mn DAUs for Sharechat). ByteDance is relying on its recommendation algorithms to create better engagement with its content.

 
 
 

Healthcare protection gap in India is estimated at $ 369 bn- As per a study by Swiss Re Institute, India has the 2nd largest healthcare protection gap in Asia, after China. In terms of average gap as a percentage of household income, India ranks 3rd worst, with only Vietnam and Malaysia in a worse position.

 
 
 

Startups have started asking “Who are my investors?”- As funds are not required to disclose their LPs, Founders are often in dark about who is ultimately funding them. Recent reports about Saudi Arabia incidents have prompted entrepreneurs to ask where the money is coming from. And Founders are now concerned about other ‘Bad Actors’ including “business interests which profit by poisoning us with opioid addiction or warm our planet with fossil fuels”. It will be interesting to see if this trend will continue and how it will impact Softbank Vision Fund in particular.

 
 
 

IBM has acquired Red Hat at $ 34 bn, a 70% premium to its share price- According to Ben Thompson, this acquisition signals the end of IBM’s public cloud efforts. Instead, IBM is hoping that “the reduction of cloud computing to three centralized providers makes businesses reluctant to commit to any one of them. IBM is betting it can again provide the solution, combining with Red Hat to build products that will seamlessly bridge private data centers and all of the public clouds.”

 
 
 
 
 
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