Timing is crucial.
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Read more Samsung and three major contract manufacturing partners of Apple are among 16 firms to win $6.65 billion incentives under India’s federal plan to boost domestic smartphone production over the next five years. These companies had applied for the incentive program in August.
In a statement Tuesday evening, Indian Ministry of Electronics and Information Technology (MeitY) said these companies will be producing smartphones and other electronics components worth more than $143 billion over the next five years. In return, India will offer them an incentive of 4% to 6% on additional sales of goods produced locally over five years, with 2019-2020 set as the base year.
New Delhi’s move is aimed at significantly improving India’s manufacturing and exporting capacities and generating more local jobs. Around 60% of the locally produced products will be exported, the Indian ministry said. The companies will generate more than 200,000 direct employment opportunities in next five years and as many as 600,000 indirect employment opportunities during the same period, the ministry said.
The move is also a precursor to how the dynamics among major smartphone makers will change in India, the world’s second largest market, over the next five years. The inclusion of Foxconn, Wistron and Pegatron underscores how rapidly Apple plans to expand its local manufacturing capabilities in India. Wistron began assembling a handful of iPhone models in India three years ago, followed by Foxconn. Pegatron has yet to start producing in India.
“Apple and Samsung together account for nearly 60% of global sales revenue of mobile phones and this scheme is expected to increase their manufacturing base manifold in the country,” the ministry said.
“Industry has reposed its faith in India’s stellar progress as a world class manufacturing destination and this resonates strongly with Prime Minister’s clarion call of AtmaNirbhar Bharat – a self-reliant India,” the ministry added.
Indian firms Lava, Bhagwati (Micromax), Padget Electronics, UTL Neolyncs and Optiemus Electronics are also among the firms that have received the approval. But missing from the list are Chinese smartphone makers Oppo, Vivo, OnePlus and Realme that had not applied for the program. Chinese smartphone vendors currently command about 80% of the Indian market.
Greycroft, the New York and L.A.-based venture firm founded in 2006 by investors Alan Patricof, Dana Settle, and Ian Sigalow, has closed on two new funds totaling $678 million in capital commitments. One of those funds is its sixth flagship early-stage fund and it closed with $310 million dollars. The firm also collected $368 million in commitments for a third growth-stage fund that it will use to support breakout startups from its early-stage portfolio.
The venture fund invests between $500,000 and $10 million in a first check, and Greycroft will invest up to $15 million in a portfolio company over multiple rounds. Checks from its growth fund begin at $10 million and the firm says it will invest up to $50 million in any one company.
Greycroft now counts seven partners altogether across its two offices, including Settle and Sigalow.
Patricof, who early in his career founded the predecessor to Apax Partners, has since launched another new firm called Primetime Partners that announced a $32 million fund in summer that is investing in platforms and products for aging Americans.
The firm invests in both consumer and enterprise startups, with a heavier emphasis on consumer. Among the brands in its portfolio are Gwyneth Paltrow’s Goop, the consignment business The RealReal (which went public last year), and the dating site Bumble, which is reportedly gearing up for an IPO at an expected valuation of between $6 billion to $8 billion, as reported by Bloomberg.
The firm also recently co-led a $5.5 million Series A round for Sisu Cosmetics, a nearly two-year-old, Ireland-based chain of cosmetic clinics that’s expanding into the U.S.
Across its now ten investment vehicles, the firm has raised $2 billion altogether and has over 200 active investments.
Those investments are located in 23 states and 15 countries, including the Nigeria-based payment service Flutterwave, which closed on $35 million in Series B funding earlier this year, and Yeahka, a mobile payment and SMB lending provider in China that went public in June.
Greycroft’s most recent early-stage fund had closed with $250 million in 2018; its second growth-stage fund closed with $250 million in 2017.
The prospect of truly zero contact delivery seems closer — and more important — than ever with the pandemic changing how we think of last mile logistics. Autonomous delivery executives from FedEx, Postmates, and Refraction AI joined us to talk about the emerging field at TechCrunch Mobility 2020.
FedEx VP of Advanced Technology and Innovation Rebecca Yeung explained why the logistics giant felt that it was time to double down on its experiments in the area of autonomy.
“COVID brought the term ‘contactless’ — before that not many people are talking about contactless; Now it’s almost a preferred way of us delivering,” she said. “So we see, from government to consumers, open mindedness about, maybe in the future you would have everything delivered to you through autonomous means, and that’s the preferred way.”
“If you looked up Postmates robots on Twitter or Instagram, people are always kind of questioning, what is this? What is it doing? Everything changed overnight with COVID, where people would see the robot and immediately understand, oh, this is for contactless delivery,” said Postmates VP of special projects Ali Kashani. “Everything suddenly made sense.”
He also explained how the seeming constraints of a robotic platform specific to food delivery made the engineering process, if not easier, at least naturally bounded by the data they’d collected.
“It’s kind of one of the advantages of being so close to the market, we can use data from our platform to drive certain decisions, because you don’t want to over-engineer you also don’t want to under-engineer,” Kashani said. “We actually developed simulations that would put robots in any location in the country on some date in the past. It would tell us, how many deliveries did this robot do? How many hours was it outside? How many miles did it travel? And it would use that information to decide exactly what kind of battery life do we need? Does it need to carry drinks? How many drink holders should it have to cover 99% of deliveries?”
Matthew Johnson-Roberson, co-founder and CTO of Refraction AI, noted that the pandemic has raised interest and demand, but also highlighted where things need to move forward in different ways.
“Obviously no one wants a global pandemic, but it has certainly energized this industry and put more attention on it,” he said. “Everybody is excited, oh, we’re going to have contactless delivery, it’s going to be great. But I think there are some real challenges that need to be addressed as an industry to get there. One of them is social acceptance, the other’s regulation. That’s starting to change because of COVID. I’m hopeful that this is an inflection point, and that we really do see more serious investment in this, but also widespread deployment, so it’s not a tech demo that you get to see once in one place, but it actually begins to take over some sizable bit of the market.”
Yeung also emphasized the need for the infrastructure that supports these autonomous platforms: “Thinking about the future, commercial launch, you need the dynamic routing, you need the dispatch system, you need the user interface, you need a tracking interface. We see great synergy for us to leverage for all sorts of autonomous applications.”
In discussing the danger of replacing human workers with robots, Yeung and Kashani were sanguine, suggesting like others in the robotics industry that there would be a shift in labor but it won’t kill any jobs. Johnson-Roberson disagreed.
“I think we are going to be replacing jobs, and we need to face that head on,” he said. “I think it’s important that we reckon with that, that a lot of these decisions, they have a long history of not thinking through what hte human consequences will be. So I’m an advocate for saying, look, we’re replacing jobs. Let’s think as a society: How do we address that? How do we deal with it? I think that we could live in a future with more just, fairer jobs with health insurance, more benefits. But I don’t think it is going to look how it looks today.”
Nvidia is in the process of acquiring chip designer Arm for $40 billion. Coincidentally, both companies are also holding their respective developer conferences this week. After he finished his keynote at the Arm DevSummit, I sat down with Arm CEO Simon Segars to talk about the acquisition and what it means for the company.
Segars noted that the two companies started talking in earnest around May 2020, though at first, only a small group of executives was involved. Nvidia, he said, was really the first suitor to make a real play for the company — with the exception of SoftBank, of course, which took Arm private back in 2016 — and combining the two companies, he believes, simply makes a lot of sense at this point in time.
“They’ve had a meteoric rise. They’ve been building up to that,” Segars said. “So it just made a lot of sense with where they are at, where we are at and thinking about the future of AI and how it’s going to go everywhere and how that necessitates much more sophisticated hardware — and a much more sophisticated software environment on which developers can build products. The combination of the two makes a lot of sense in this moment.”
The data center market, where Nvidia, too, is already a major player, is also an area where Arm has heavily focused in recent years. And while it goes up against the likes of Intel, Segars is optimistic. “We’re not in it to be a bit player,” he said. “Our goal is to get a material market share and I think the proof to the pudding is there.”
He also expects that in a few years, we’ll see Arm-powered servers available on all of the major clouds. Right now, AWS is ahead in this game with its custom-built Gravitron processors. Microsoft and Google do not currently offer Arm-based servers.
“With each passing day, more and more of the software infrastructure that’s required for the cloud is getting ported over and optimized for Arm. So it becomes a more and more compelling proposition for sure,” he said, and cited both performance and energy efficiency as reasons for cloud providers to use Arm chips.
Another interesting aspect of the deal is that we may just see Arm sell some of Nvidia’s IP as well. That would be a big change — and a first — for Nvidia, but Segars believes it makes a lot of sense to do so.
“It may be that there is something in the portfolio of Nvidia that they currently sell as a chip that we may look at and go, ‘you know, what if we package that up as an IP product, without modifying it? There’s a market for that.’ Or it may be that there’s a thing in here where if we take that and combine it with something else that we were doing, we can make a better product or expand the market for the technology. I think it’s going to be more of the latter than it is the former because we design all our products to be delivered as IP.”
And while he acknowledged that Nvidia and Arm still face some regulatory hurdles, he believes the deal will be pro-competitive in the end — and that the regulators will see it the same way.
He does not believe, by the way, that the company will face any issues with Chinese companies not being able to license Arm’s designs because of export restrictions, something a lot of people were worried about when the deal was first announced.
“Export control of a product is all about where was it designed and who designed it,” he said. “And of course, just because your parent company changes, doesn’t change those fundamental properties of the underlying product. So we analyze all our products and look at how much U.S. content is in there, to what extent are our products subject to U.S. export control, U.K. export control, other export control regimes? It’s a full-time piece of work to make sure we stay on top of that.”
Here are some excerpts from our 30-minute conversation:
TechCrunch: Walk me through how that deal came about? What was the timeline for you?
Simon Segars: I think probably around May, June time was when it really kicked off. We started having some early discussions. And then, as these things progress, you suddenly kind of hit the ‘Okay, now let’s go.’ We signed a sort of first agreement to actually go into due diligence and then it really took off. It went from a few meetings, a bit of negotiation, to suddenly heads down and a broader set of people — but still a relatively small number of people involved, answering questions. We started doing due diligence documents, just the mountain of stuff that you go through and you end up with a document. [Segars shows a print-out of the contract, which is about the size of two phone books.]
You must have had suitors before this. What made you decide to go ahead with this deal this time around?
Well, to be honest, in Arm’s history, there’s been a lot of rumors about people wanting to acquire Arm, but really until SoftBank in 2016, nobody ever got serious. I can’t think of a case where somebody actually said, ‘come on, we want to try and negotiate a deal here.’ And so it’s been four years under SoftBank’s ownership and that’s been really good because we’ve been able to do what we said we were going to do around investing much more aggressively in the technology. We’ve had a relationship with Nvidia for a long time. [Rene Haas, Arm’s president of its Intellectual Property Group, who previously worked at Nvidia] has had a relationship with [Nvidia CEO Jensen Huang] for a long time. They’ve had a meteoric rise. They’ve been building up to that. So it just made a lot of sense with where they are at, where we are at and thinking about the future of AI and how it’s going to go everywhere and how that necessitates much more sophisticated hardware — and a much more sophisticated software environment on which developers can build products. The combination of the two makes a lot of sense in this moment.
How does it change the trajectory you were on before for Arm?