Happy Monday!
Do you think it’s okay to designate executives as co-founders even if they haven’t technically founded the company? That’s the question ETtech asked on a Twitter poll. And nearly two-thirds of the respondents said it’s not okay to pick hired executives as co-founders.
@samidhas Do you think it’s okay to designate executives as cofounders even if they haven’t technically founded the… https://t.co/lEIcHvdSUF
— ETtech (@ETtech) 1590388062000
Over the past few years, Indian startups, big or small, have given the co-founder title to several executives who joined the company at later stages. Food ordering platform Zomato on Sunday elevated Mohit Gupta, the CEO of its food delivery business, by making him a founder. Last year, Gaurav Gupta, chief operating officer of the company, was also given the title of co-founder. In all, the Ant Financial-backed firm now has four co-founders— Deepinder Goyal, Gunjan Patidar, Gaurav Gupta and now Mohit Gupta.
What’s in the title?
In an email to staff, Goyal, founder and chief executive of Zomato, said: “When I introduced the Founders Programme a little over a year ago, I outlined a few qualities that all founders must exhibit. These qualities include trustworthiness, commitment and resilience among other things. MG checks all these boxes and more.”
Why it matters
Order volumes for Zomato have hit an all-time low due to the Covid-19 pandemic, prompting it to lay off 520 employees, or 13% of its workforce, and cut salaries of the rest.
While this phenomenon is more prevalent in the India startup ecosystem, Tesla is one of the prominent examples in the United States. Read more.
Insta eyes TikTok users
TikTok’s closest rival, Instagram, is advertising on the short-video platform as its user growth shows signs of slowing. The Facebook-owned photo-and-video-sharing platform has been putting video ads that show up on a TikTok user’s For You Page (video feed customised per user’s liking). These video ads have steadily grown in number, from just 16 in January 2020 to around 70 in March, and to four times as many at over 300 in April.
This may seem odd as the two platforms attract different kind of audience — if Instagram is where people are picture-perfect, TikTok users are known for showing their real picture to the world without fearing judgement. But, according to experts, the move to acquire new users is to sustain advertiser interest. Read more.
E-commerce may lose steam
Online retailers like Flipkart and Amazon are seeing a sharp recovery in sales as pent-up demand for a range of non-essentials is restoring overall industry volumes lost during the nationwide lockdown. Orders of smartphones, laptops, tablets, kitchen and home appliances—in the week since all items were permitted to be sold online—has brought sales back to about 70% of pre-Covid-19 levels.
Will it sustain?
Probably not, say experts. This may taper off in the coming fortnight as consumers continue to purchase only need-based products and delay discretionary spends.
The silver lining
The sale of essentials and grocery products continue to be robust and is expected to double in terms of overall sales to $3 billion this year, according to Forrester Research. Read more.
Startup India fund
The Department for Promotion of Industry and Internal Trade (DPIIT) will soon approach the union Cabinet with a proposal to create a Startup India seed fund and launch a credit guarantee scheme to help budding entrepreneurs. The National Seed Fund seeks to support ideation and development of early-stage startups whereas the credit guarantee scheme will enable these firms to get easier loans.
Why it matters
The country’s startup sector has been hit hard due to disruptions caused by the Covid-19 pandemic and the subsequent lockdown. As per apex software and services body Nasscom, 40% of startups have either temporarily halted operations or are in the process of shutting down, with around 70% having cash reserves to last less than three months. Read more.
Overstretched hospitals
After facing criticism in handling the coronavirus pandemic, Mumbai has ramped up its critical care facilities. The Brihanmumbai Municipal Corporation has expanded healthcare capacity for Covid-19 by thrice in a span of just two weeks. Makeshift care facilities called ‘Jumbo’ centres have come up in the city’s suburban exhibition grounds to tackle the surge in Covid-19 cases.
Why it matters
This comes at a time when the city’s municipal body has faced criticism with several patients moving from one hospital to the other in search of beds, and some succumbing to the disease due to late hospitalisation. The Maharashtra government has also forced private hospitals to give beds for Covid-19 treatment and capped the prices. Read more.
(Illustrations and graphics by Rahul Awasthi)
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