Consolidation in the online food delivery segment continues as ride-hailing giant Uber acquires Postmates.
Meanwhile, Instagram is partnering with youth-centric ventures to help teens counter hate and misinformation
Food Delivery Consolidation
Uber is buying Postmates for $2.65 billion in an all-stock deal, in a bid to strengthen its presence in the on-demand food delivery segment while its core ride-hailing business struggles due to the Covid-19 pandemic.
Postmates was last valued at $2.4 billion, when it raised $225 million funding in September last year.
What’s happened so far?
This deal comes after Uber failed in June to buy rival Grubhub that was acquired by European delivery firm Just Eat Takeaway, formed by the $7.6 billion merger of Just Eat and Takeaway.com in January this year.
What’s the plan?
Uber will combine Postmates with its food delivery business Uber Eats but will continue to keep Postmates app running separately, supported by a “more efficient, combined merchant and delivery network.”
“For restaurants and merchants, Postmates and Uber Eats will together offer more tools and technology to more easily and cost-effectively connect with a bigger consumer base,” Uber said in a statement.
Uber Eats exit
Uber Eats had shut down its food delivery service in seven markets and transitioned its operations in the UAE to its subsidiary Careem in May. This was after it sold its India business to rival Zomato for $206 million in January this year. Read more.
Instagram’s teen training camp
The growing hate speech and misinformation across platforms like Instagram is having a significant impact on teenagers trying to navigate the online world.
To tackle this, the Facebook-owned photo-sharing platform is partnering with youth-focused organisations to build safe digital spaces to discuss issues like bullying, body-shaming, mental health, loneliness, and gender diversity, among other matters.
What are they doing?
Through these initiatives, Instagram is teaching teens how to create catchy content for positive advocacy, providing them ad budgets to amplify their content’s reach, training them on using hashtags and tagging the right people for their post.
Instagram spends Rs 3-4 crore annually to push these initiatives in India as part of its global safety and well-being programme, said people aware of the initiatives.
In the last three years, over 400 teenagers across India and Nepal have uploaded close to 7,000 posts on positive advocacy, garnering a following of 65,000 users. Read more.
Facebook’s education push
Facebook has also partnered with the Central Board of Secondary Education (CBSE) to provide training on digital safety, online well-being and augmented reality (AR) to students and teachers. This course is expected to cover various aspects such as safety, privacy, mental health and Instagram’s guide for building healthy digital habits. Read more.
Digital payments soar
Digital payments surged during the lockdown, with payment firms seeing record sign-ups and increased volumes on online channels, in a likely indication of new trends in consumer behaviour among youth and older citizens.
Where are people spending money?
In the first 100 days of the lockdown, payments firm Razorpay noticed spends on online education growing by 23%, while medical purchases grew by 20% and social engagements including personal counselling, dating, and matrimony websites increased by 32%.
Utility bill payments grew 163% during the period, a trend that was also echoed by digital payments firm PhonePe which saw the biggest increase coming from recharges and bill payments. Read more.
Fall in private equity deals
Private equity investments in India have seen a steep fall in the first six months of calendar year 2020, with transactions dropping by as much as 40% to $13 billion.
Key takeaways
- $100 million-plus deals drop to 30, from 55 in H1 2019
- Top 15 deals accounted for about 35% of the total investments in H1 2020
- The total value of exits dipped by about 45% year-on-year to $3 billion in H1 2020.
- VC investment activity remained steady at $4.3 billion
- Saas, Ed-tech and healthcare expected to drive recovery in dealmaking. Read more
Race for video conferencing solutions
Bharti Airtel is set to launch its own video conferencing solution for startups and enterprises. This comes close on the heels of rival Reliance Jio launching its JioMeet.
The initial plan is to offer it to enterprises, and depending on the uptick, roll it out to its regular customers. Airtel is billing localisation and security as the key differentiators for its service.
Why are they doing this?
The move comes at a time when video conferencing is finding greater adoption due to the increasing trend of remote working to tackle the Covid-19 pandemic. Players like Zoom, Google Hangouts, and Microsoft Teams are witnessing unprecedented demand among enterprises as well as regular consumers.
Google made its business-only Meet video conferencing solution available to all users in May while Microsoft recently rolled out a preview version of Microsoft Teams to consumers, with wider availability expected in the coming weeks. Read more.
(Illustrations and graphics by Rahul Awasthi)
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