Breaking: Foxconn walks away from a $19.5B joint venture with conglomerate Vedanta to produce semiconductors. The Indian government is however unfazed by this exit.

One quick thing: Instagram’s Twitter rival Threads crosses 100 million users in 5 days. Elon Musk throws a fit. 

In today's newsletter:

• Top global investors go missing in India
• Dunzo skips salaries in June
• The Frontrow story ends

Was this newsletter forwarded to you? You can sign up for Tech3 here

The current funding landscape is undoubtedly one of the most difficult, if not the most daunting, with two of the country's most influential investors having stepped back from the market.

SoftBank has not cut a cheque for a year now, marking its biggest funding drought in the country yet.

Meanwhile, Tiger Global clocked just two deals in the first half of 2023, a far cry from close to 40 deals in the same period last year. 

• In fact, this is Tiger Global’s lowest deal count for the six month period in the past five years.

SoftBank's silence and Tiger Global's slowdown sound a loud alarm: global investors are treading cautiously in India's startup realm.

• With over $18 billion poured in by these two investors over the last nine years, their retreat speaks volumes

This leads us to a much-trending question: Did everyone overestimate India’s market?

Well, some of the strongest tech voices believe so. 

Rajeev Misra, CEO of SoftBank Investment Advisers, Sameer Nigam, co-founder and CEO of India’s most-valued fintech platform PhonePe, and Nithin Kamath, co-founder and CEO of India’s largest stock broking platform Zerodha all believe, that investors and founders did actually overestimate India’s internet market.

• The three echoed: the size of the internet market in India is 100 million consumers.

What if I tell you an investor with close to 20 years of experience, who has backed nearly 600 startups globally, never looked at potential returns while making an investment.

It will blow your mind, won’t it?

Vinod Khosla, one of the most influential investors in Silicon Valley told us the same at the Moneycontrol Startup Conclave last week. Tune in to watch his keynote. Else, read his full interview here.

After a string of layoffs, quick commerce player Dunzo has now delivered some bad news to employees

Dunzo has skipped salary payments to around 500 employees in June, which meant about 50 percent of its workforce did not receive money last month. This is despite the startup raising $75 million funding in April.

• Salaries are only deferred and will be cleared later this month, the company told employees.
• Top management are hit hardest with the move  

Deferring salaries is the latest issue at the Bengaluru-based startup, which is fast running out of cash. 

• In the past six months or so, Dunzo has undertaken two rounds of layoffs and also reduced its dark store network by around 50 percent. 

Dunzo has also increased focus on a marketplace model and now relies less on its dark store network. 

Another one bites the dust within the Indian edtech arena. 

The founders of FrontRow - which has been struggling for more than a year now - have decided to call it quits.

The edtech startup, which counts Elevation Capital and Lightspeed India among its backers, shut its operations on June 30, sources told us.

• This comes weeks after we reported the company is considering a potential sale or a shutdown.

With this, FrontRow joins the list of edtech companies like Udayy, and Lido, that had to shut shop amidst a slowdown in demand for online learning.

FrontRow has struggled to find a product-market fit in India despite multiple attempts

• Last month, FrontRow’s Ishaan Preet Singh had told us that their offering is likely ‘too early’ for the market, a conclusion they derived after running three to four experiments.

The company also resorted to two rounds of layoffs - one in May 2022 and another in October 2022. 

Singh told us they are still exploring a couple of potential acquisitions for its IP (intellectual property) and the team or return the capital to its investors. 

Meanwhile, Coursera’s Jeff Maggioncalda believes the online learning wave will not die anytime soon 

• While speaking at Moneycontrol Startup Conclave on Friday, he said that there is a strong adoption of online learning even in the physical classroom. Read more here or watch video.

In Bengaluru, when Bruhat Bengaluru Mahanagara Palike lays a road, another agency digs it up. Thanks to lack of communication and coordination among multiple agencies, a proposal for an umbrella body similar to Transport for London was met with fleeting enthusiasm.

However, it's now been more than six months since the Karnataka government notified the creation of the Bengaluru Metropolitan Land Transport Authority (BMLTA), yet it remains only on paper.

Read our special story

Apple's App Store is 15 years old today. The iPhone maker debuted the mobile app marketplace with 500 apps on July 10, 2008. The launch coincided with Apple introducing iPhone 3G, the successor to the original iPhone.

• The App Store has become a key contributor to the company's overall revenues in recent years, and is a crucial component for its future growth

In January, Apple said it has paid $320 billion to developers, up from $260 billion as of last year. The company currently levies 15-30 percent commission from developers on all in-app purchases and digital sales made through the App Store.

• App Store's business practices however have also attracted scrutiny from various regulatory authorities across the world.

• Comedian Sarah Silverman and two other book authors are suing OpenAI and Meta, accusing them of allegedly using their content to train AI language models without permission.

• Google is testing its medical AI chatbot Med-PaLM 2 at the Mayo Clinic research hospital, according to the Wall Street Journal. The chatbot can provide responses to medical questions and perform tasks such as summarising documents or organising health research data among others.

Shah Rukh Khan fans are in for a big treat!

The ‘Badshah’ of Indian cinema put out a two-minute 'prevue' of his upcoming movie Jawan, providing glimpses of his different looks in the movie, including many unconventional ones. The action movie will also star Nayanthara and Vijay Sethupathi. 

Watch the teaser