Moneycontrol Bureau
India's startup ecosystem was replete with controversies all year around. From startup shutdowns, CEOs taking digs at each other, CXOs quitting en masse, deal deadlocks and layoffs, the startup ecosystem had enough to offer. Here are a few of those events which played out during the course of the year.Rise of startup nationalism
At an event in Bengaluru, Flipkart co-founder Sachin Bansal and Ola CEO Bhavish Aggarwal argued for protection of Indian companies which are unable to compete in sectors where MNCs are pumping in heavy capital. It led to a huge debate on rise of nationalism among the tech startup ecosystem.Demonetisation: E-wallets come to the rescue
After Prime Minister Narendra Modi announced the demonetisation drive, use of mobile wallets increased rapidly. Companies such as JioMoney, Paytm, and Freecharge saw a huge number of downloads. Merchants and traders also switched to mobile wallets as cash crunch hit them hard. Lack of traditional payment options such as point-of-sale machines, too, increased the adoption of e-wallet apps.Devaluation of Flipkart
Flipkart kept hitting news tickers repeatedly and was devalued by two of its major investors. Morgan Stanley marked down Flipkart’s valuation to USD 5.6 billion and Vanguard Fund devalued its share in Flipkart by 33 percent. Flipkart has now reached its lowest-ever markdown.Nikesh Arora quits SoftBank
Nikesh Arora, world’s third-highest paid executive with an annual salary of Rs 500 crore, quit SoftBank as the Chief Operating Officer. Arora led the Japanese investment firm’s major deals in India, including Snapdeal, Ola, Housing, OYO Rooms, and InMobi.Taxi aggregator wars
Uber sued Ola for USD 7.5 million alleging that the latter was using fake accounts to book trips on Uber and then cancelling them, thereby interrupting their business. Ola replied that Uber’s petition “has been filed in an attempt to bypass the laws of the land by foreign companies who run their operations in this country for profit without due regard for the applicable laws”.Unicorn founders' divorce
Bengaluru-based Mu Sigma is one of the few India-based non-e-commerce startups which are unicorns. When founder Dhiraj Rajaram and his wife Ambiga, who was the company’s CEO went for a divorce, the startup ecosystem was abuzz about couples starting companies together.
AskMeBazaar saga
Since the beginning of the startup boom a few years ago, 2016 may just be the year which saw the most shutdowns. Big startup players AskMeBazaar shut shop this year. Besides, layoffs also increased this year as many startups were either acquired or shut down.Curtains for grocery e-tailers
One of the largest grocery e-tailers in India, PepperTap shut shop in 2016 after raising USD 50 million. The shutdown triggered a panic amongst hyperlocal startups and many investors declined to infuse funds in the following rounds. About 20 such startups closed operations in 2016.Oyo-Zo deal deadlock
SoftBank chief Masayoshi Son-backed Oyo Rooms announced acquisition of rival company ZO Rooms. The aim was to take out competition in the hotel room aggregation segment. The Oyo-ZO deal, however, was stuck in a deadlock over valuation issues. Subsequently, ZO Rooms ran out of cash and shut down.CEOs vs Twitter trolls
The year also saw friendly banters and trolling in 2016. It was a year of "Twitter Trolls" in India’s startup ecosystem. Twitter users such as @uni_con1 and @Corporatekumar_ tweeted insider gossip in startups, people movements and rarely spared an opportunity to take a dig at startups founders. Jabong founder Praveen Sinha even filed an FIR against Unicon Baba for defamation. Snapdeal CEO Kunal Bahl, who came under fire from such handles, retaliated by saying that he has developed a ‘thick skin’ against trolls.
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