Startup News 101

The Department for Promotion of Industry and Internal Trade (DPIIT) has partnered with venture debt firm Stride Ventures to support high-growth startups. This collaboration aims to provide financial support, strategic mentorship, and market access, fostering entrepreneurship and innovation. Stride Ventures will focus on identifying high-potential startups, particularly from tier-2 and tier-3 cities, offering funding, policy support, and global mentorship. Additionally, the partnership will promote awareness of diverse fundraising instruments like venture debt, aiding startups in scaling their operations. Stride Ventures' billion-dollar commitment further strengthens India’s startup ecosystem.

BMW and Yamaha Motor have invested in Phoenix Tailings, a U.S.-based rare earths processing startup, to boost production of strategic metals outside China. Rare earths, crucial for electric vehicles and electronics, are mainly refined using an expensive and polluting method, which China has perfected. Phoenix offers a cleaner, low-emission process to produce rare earths from mined ore or recycled equipment. The company raised $43 million in a Series B funding round and plans to build a $13 million facility in Exeter, New Hampshire. Phoenix aims to expand production and go public in 3-5 years, benefiting from U.S. government support.

Volocopter, founded in 2011, filed for insolvency on December 26, 2024, after failing to secure funding despite intensive efforts. The company, developing electric air taxis, aims to restructure by February 2025. Volocopter had planned to launch its two-seater "Volocity" model in 2025 but faced delays, including cancelled test flights during the 2024 Paris Olympics due to engine certification issues. The company is also working on a five-seater model for 2027. Volocopter's struggles reflect challenges faced by German eVTOL startups, with competition from US and Chinese firms and concerns over insufficient state support for innovation.

BluSmart, an electric vehicle (EV) cab service provider based in Gurugram, announced its expansion into Mumbai, set to begin on January 1, 2025. The company will initially offer services through an invite-only program, allowing a select group of users to experience premium rides before the full launch. BluSmart, founded in 2019, operates a fleet of over 7,600 EVs and has completed over 21 million rides. It also owns and operates its own charging stations, BluSmart Charge, in cities like Delhi NCR and Bengaluru. Unlike Uber and Ola, BluSmart follows an asset-heavy model, owning its fleet and employing salaried drivers.

Tata Group, under chairman N Chandrasekaran, plans to create five lakh manufacturing jobs in India over the next five years, focusing on battery, semiconductors, electric vehicles, and solar industries. This effort includes new facilities such as India's first semiconductor fab in Gujarat and battery manufacturing plants in Gujarat and the UK. The group aims to support India's growing workforce, with additional job opportunities in sectors like retail and hospitality. Chandrasekaran also emphasized the transformative potential of AI in healthcare, mobility, and manufacturing. He paid tribute to Ratan Tata, recognizing his enduring influence on the group's success.

Elon Musk's AI startup, xAI, raised $6 billion in its latest funding round, bringing its valuation to $50 billion, though still behind OpenAI's $157 billion. The funding comes from US venture capitalists, chipmakers NVIDIA and AMD, and investors from Saudi Arabia and Qatar. xAI, which launched in July 2023, focuses on developing AI products like the Grok chatbot and aims to create groundbreaking technologies. Despite its high valuation, critics note AI companies' struggle with profitability. Musk, who also leads SpaceX and Tesla, is involved in legal action against OpenAI, which he co-founded in 2015.

Accel India has closed its eighth fund, securing $650 million, alongside its global growth fund raising $1.35 billion. With nearly $3 billion committed to India, Accel plans to focus on pre-IPO rounds, non-metro markets, and doubling down on new and existing investments. The firm has seen significant gains from exits like Swiggy, Flipkart, and Blackbuck, with several portfolio companies, including Bluestone, Zetwerk, and Urban Company, poised for IPOs in 2025. Accel’s recent deals include Uppercase and Swish. Amid abundant VC dry powder, major funds like Stellaris, Lightspeed, and Peak XV also remain active, signaling continued interest in India’s startup ecosystem.

NSDC International and PhysicsWallah (PW) have launched Bharat Innovation Global Private Limited (BIG) to position India as a global education hub by bridging the gap between academia and industry. BIG integrates skill training into school curricula for classes 11 and 12 and extends its reach to ITIs, Polytechnics, universities, and the workforce, fostering lifelong learning. It also focuses on capacity building for government employees. Leveraging technologies like AI-driven career guidance and adaptive learning, BIG offers accessible, scalable, and personalized education aligned with NEP 2020. This initiative aims to empower learners with industry-relevant skills for the evolving job market.

Hyperlocal delivery startup Magicpin has launched magicNOW, a 15-minute food delivery service, after a successful pilot between November 14 and December 15. Initially available in six Indian cities, including Delhi NCR, Bengaluru, Chennai, Hyderabad, Mumbai, and Pune, it operates within a 1.5-2 km delivery radius, partnering directly with restaurants to ensure food freshness. Powered by Velocity by Magicpin, the service leverages logistics providers like Shadowfax, Dunzo, and Rapido. Magicpin, which partners with over 2,000 brands, has grown significantly on ONDC, processing 150,000 daily orders. During Diwali 2024, it reduced platform fees to INR 5, recording 500,000 orders.

The BBC has filed a complaint with Apple over AI-generated fake news shared on iPhones and falsely attributed to the broadcaster. Apple Intelligence, a feature launched in Britain, aggregates AI-generated notifications from multiple news sites. One such notification falsely claimed the BBC reported the suicide of Luigi Mangione, a US murder suspect. The BBC emphasized its commitment to maintaining trust in its journalism, stating that accurate representation of its name and content is crucial. A spokesperson confirmed the broadcaster has contacted Apple to address and resolve the issue, ensuring such misinformation does not damage its credibility.