ET Graphics: AI startups are still hot investment picks
generative AI
startups continue unabated despite macro downturns and geopolitical tensions. Going by Pitchbook's latest report, 58% of the $73-billion global VC investments in the first quarter of 2025 was in AI startups.
ETtech
The
2025 Stanford AI Index report
says private AI investments increased 44.5% between 2023 and 2024. In addition, corporate investments in AI through mergers and acquisitions, minority stakes and public offerings have seen a 25.5% uptick in 2024 compared to in 2023. These investments stood at $19 billion in 2014. This has come on the back of rising adoption of AI as companies begin to see clear return on investments. Swathi Moorthy looks at how the AI investment landscape has changed in the past year in terms of investments and adoption.
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Economic Times
18 hours ago
- Economic Times
Trump backs crypto, Pakistan embraces it. How long must India wait?
Synopsis Pakistan embraces crypto for strategic gains, including potential US favor, while India grapples with regulatory uncertainty and security concerns. Other nations like Bhutan leverage crypto for economic diversification. The US faces scrutiny over stablecoin regulation and potential conflicts of interest, prompting calls for India to establish a clear, comprehensive crypto policy to address financial and security risks. ETtech Photo: Ewan Kennedy A couple of weeks before the Pahalgam attack, something strange happened in Islamabad. Changpeng Zhao, the Chinese-born Canadian businessman and founder of Binance, the world's largest cryptocurrency exchange, agreed to be an advisor to the Pakistan Crypto Council (PCC) in early April. PCC, freshly minted in March, was cobbled together to create a framework for crypto in a country that had until then been notoriously suspicious of digital the time, many wondered what Pakistan's motivation was in welcoming crypto, which officials maintained was a tool to attract foreign investment. In the subsequent months and during Operation Sindoor, it became clear that the move had a strategic angle as well. Pakistan, having signed up with World Liberty Financial (WLF), a crypto company linked to US President Donald Trump's family, was also using crypto to gain currency with the White House. That, along with carrots like a Nobel peace prize nomination for Trump, may have influenced the US's tepid pushback on Pakistan during the conflict. On July 9, Pakistan went all in with President Asif Ali Zardari signing an ordinance establishing the Pakistan Virtual Asset Regulatory Authority (PVARA), 'an autonomous federal body empowered to license, regulate and supervise entities dealing in virtual assets (VA)'.That is quite a move for a struggling economy desperate for bailouts from the International Monetary Front (IMF), but the reality is that Pakistan is not alone in embracing US is racing to legitimise stablecoins—a type of cryptocurrency pegged to stable assets. Almost 98% of stablecoins are tied to the dollar. India's neighbour Bhutan has quietly built bitcoin reserves worth $1.3 billion or roughly 40% of the country's gross domestic product (GDP), according to the Wall Street Journal . Countries like Russia, Iran and North Korea have been using it to conduct business, beyond the reach of the international sanctions countries with a clear agenda—from attracting investment, to sidestepping sanctions, or even currying favour with the world's elite—crypto is becoming a legit play. That has meant that from US to UAE, Singapore to Bhutan, countries have made crypto a part of their foreign and economic policy playbook. The big question: where is India in all of this?'Why does the Centre not come out with a clearcut policy on regulating cryptocurrency?'The Supreme Court's pointed question to Additional Solicitor General Aishwarya Bhati during a May 19 hearing encapsulates India's prolonged struggle with digital assets. The bench, hearing a bail plea in an illegal bitcoin trade case, stated: 'There is a parallel under-market for it and it can affect the economy. By regulating the cryptocurrency, you can keep an eye on the trade.'This wasn't the first judicial nudge. In February 2022, the apex court had similarly pressed the central government to clarify whether cryptocurrency trading was legal in repeated queries highlight a regulatory vacuum that continues to perplex the courts. India's crypto landscape remains in what experts describe as a 'state of flux' where lawsuits involving fraud get dismissed due to 'a lack of legal status for cryptocurrencies in India'.The Reserve Bank of India's concerns about financial stability continue to shape the government's cautious approach. The central bank fears that cryptocurrencies could undermine its control over money supply and pose risks to financial and monetary stability. This, even as the market regulator Securities and Exchange Board of India (Sebi) has reportedly recommended that several regulators oversee trade in cryptocurrencies. The Centre has to take a clear stance, backed by a well-defined policy vision, at a time when the technology is increasingly exploited by hostile the regulatory framework consists of a flat 30% tax on capital gains and 1% tax deducted at source (TDS) on transactions above Rs 10,000, introduced in 2022. In March 2023, the finance ministry mandated all crypto exchanges operating in India to register with the Financial Intelligence Unit–India (FIU–IND).There have been news reports that India is reconsidering its stance amid growing global acceptance, but a promised discussion paper outlining policy framework options for crypto assets —scheduled for June—has still not been the use of virtual assets for terror financing has been 'overall on the increase', according to a report by the Financial Action Task Force (FATF), an intergovernmental body tracking financial crime, released this week.A country with a history of terror financing that can easily weaponise crypto against India is plunging headlong into it. How long must India wait? Pakistan's strategy extends beyond partnerships, with the country exploring bitcoin mining using surplus energy to create a strategic bitcoin reserve. 'Crypto is becoming a channel for strategic financial flows for Pakistan,' says Anirudh Suri, MD, India Internet Fund. 'For countries like Pakistan, aligning crypto policy with US frameworks isn't just diplomacy, it's a transactional pipe to stay useful to America's geopolitical interests.'Suri points out that's not positive for India by any measure: 'India is trying to choke financial flows to terror groups via FATF and IMF diplomacy, and crypto could reopen that tap.'Subimal Bhattacharjee, an independent adviser and consultant on cybersecurity, defence and technology policy, warns of the implications: 'What are the impacts of rogue elements using it? How do we guard our people against that? The answer to everything is in a coherent and clear crypto policy. To put it simply, we have to make it a regulated entity.'Following the Pahalgam terror attack, India's FIU instructed crypto exchanges to closely monitor transactions, specifically from Jammu and Kashmir and other border regions. Exchanges were directed to scrutinise private wallets and private coins used for person-to-person transfers without blockchain notes that there may be arms within Pakistan's government or military establishment that like open crypto channels—enabling a continued flow of funds. 'For a country like Pakistan, maintaining a fluid stance on crypto allows them to either attract financial flows or pursue other strategic objectives,' he says. While Pakistan's approach raises security concerns, Bhutan presents a different model. The Himalayan kingdom has been quietly mining bitcoin since 2020, using abundant hydropower, accumulating enormous reserves of it. The country is integrating crypto into tourism and its upcoming smart city project, and views Bitcoin not merely as a store of value but as a tool to diversify its Gowdara Shivamurthy, an associate fellow with the strategic studies programme at the think tank Observer Research Foundation, says Bhutan's foray into bitcoin mining is driven largely by domestic economic necessity, to diversify beyond tourism and hydropower, and is meant to curb brain drain. Revenues from mining have already helped them shore up foreign reserves and fund public spending—including significant salary hikes for civil India recognises Bhutan's sovereign right to diversify its economy, there are worries, particularly around reduced hydropower exports, and imports of Chinese bitcoin mining companies like Adani have shown interest in setting up data centres there, and how those moves unfold could shape the long-term GENIUS (Guiding and Establishing National Innovation for US Stablecoins) Act—currently pending a vote in the US House of Representatives, expected in the week of July 14—aims to set a regulatory framework for stablecoins in the country. But there are plenty of the US president made nearly $57.4 million in 2024 from his cryptocurrency company, World Liberty Financial, according to the latest disclosures. This is before Trump became president for the second time. The company has floated its own stablecoin, are allegations that the GENIUS law would provide even more opportunities to reward buyers of Trump's coin with favours, including tariff exemptions, pardons and government appointments.A case in point — before the US president's visit to West Asia, MGX, a fund backed by Abu Dhabi, said it would make a $2 billion investment using USD1 into Binance, triggering allegations of conflict of interest.'I wouldn't be surprised if other countries now try to exploit this pathway to gain access or soften the stance of the US administration. Under Trump, the line between strict adherence to global norms and personal or commercial interests appears to have blurred,' says of this should worry India. Observers believe US may leverage its influence within FATF to promote GENIUS, with all its loopholes, as the new global standard for crypto regulation. It is a move especially significant for Pakistan, a country previously flagged for terror financing, which could take a leaf out of the GENIUS Kumar, deputy director for future of money at the GeoEconomics Center of Atlantic Council, says the biggest challenge going forward is fragmented regulation. 'Crypto doesn't really listen to borders. So it's not really a domestic problem, it's an international problem that everyone needs to come together on.'But clarity in policy in India would help resolve the current uncertainty, which often undermines consumer protection, and allows legit crypto entrepreneurs—many of whom have moved operations abroad, or shut down—to work within a well-defined framework.'Virtual digital assets or crypto assets have not been defined outside of income tax and anti-money laundering laws in India. The lack of classification under foreign exchange laws, securities laws, payments laws and goods and services tax creates critical ambiguities. This leads to uncertainty for both businesses and consumers,' says Jaideep Reddy, partner at Trilegal.'India needs regulation around the treatment of US dollar-denominated stablecoins, because it's also a concern of capital flight—money flowing into dollars instead of rupees,' says Kumar. 'India would likely want to create some sort of threshold.'As India's neighbours forge ahead with comprehensive crypto strategies, the question posed by the Supreme Court becomes increasingly pressing. The choice is no longer between embracing or rejecting crypto.
Time of India
a day ago
- Time of India
How Microsoft 'killed' OpenAI's $3 billion acquisition of WindSurf, making Google the 'big winner'
FILE (AP Photo/Rick Rycroft, File) OpenAI's $3 billion agreement to buy the AI coding startup WindSurf has fallen apart. The highly-anticipated acquisition deal between artificial intelligence powerhouse OpenAI and AI coding startup Windsurf. OpenAI had reportedly been close to finalizing the deal to acquire Windsurf, formally known as Exafunction Inc. , with a signed letter of intent and investor payout agreements (waterfall agreements) already in place. The acquisition was even nearing an announcement in early May, according to sources familiar with the discussions. However, an OpenAI spokesperson has confirmed that the exclusivity period for their offer has lapsed, leaving Windsurf free to explore other opportunities. In a swift turn of events, Alphabet Inc's Google has stepped in, striking a deal worth approximately $2.4 billion to acquire top talent and licensing rights from Windsurf. This move comes hot on the heels of the collapsed OpenAI acquisition . Google announced on Friday, July 11, that it is bringing Windsurf Chief Executive Officer Varun Mohan and co-founder Douglas Chen, along with a small team of staffers, into its DeepMind artificial intelligence unit. While the company declined to disclose the specific financial terms, it clarified that the agreement does not involve taking an equity stake in Windsurf itself. This development marks a significant strategic gain for Google in the competitive AI landscape, securing valuable expertise and technology that had been hotly contested by its rivals. Microsoft tensions behind OpenAI-Windsurf deal collapse by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like An engineer reveals: One simple trick to get internet without a subscription Techno Mag Learn More Undo A significant factor in the unraveling of the OpenAI-Windsurf deal appears to be friction with kMicrosoft Corp., a major investor and key partner for OpenAI. According to a Bloomberg report, sources close to the matter indicate that Windsurf was hesitant to grant Microsoft access to its intellectual property. This condition became a sticking point that OpenAI was reportedly unable to resolve with Microsoft, whose existing agreement with OpenAI grants the software giant access to the AI startup's technology. This issue was reportedly one of several points of contention in ongoing discussions between Microsoft and OpenAI regarding OpenAI's restructuring into a commercial entity. What is Windsurf into Founded in 2021, Windsurf is a prominent player in the burgeoning field of AI-driven coding assistants. These systems are designed to automate and streamline coding tasks, including generating code from natural language prompts. The startup has successfully raised over $200 million in venture capital funding from investors like Greenoaks Capital Partners and AIX Ventures, according to PitchBook data. AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Economic Times
a day ago
- Economic Times
Nasher Miles to open 20–25 offline stores, eyes quick commerce growth
ETtech Lokesh Daga, CEO, Nasher Miles Direct-to-consumer (D2C) luggage brand Nasher Miles plans to open 20 to 25 exclusive brand outlets (EBOs) across India by the end of this financial year as it looks to expand its offline presence beyond online company currently has five to six launches in the pipeline, including three in Mumbai, two in Hyderabad, and one in Ahmedabad, and is scouting additional locations in tier-I cities. The goal is to scale up to 100 outlets over the next two years, chief executive officer Lokesh Daga told ET in an interaction. 'We are looking for opportunities as they come. The idea is to see whether we can scale to 100 stores over the next two years,' Daga said on the sidelines of the company's offline retail store launch in Mumbai. Quick commerce bets Even as it pushes offline expansion, Nasher Miles continues to scale rapidly through quick commerce platforms like Zepto, Blinkit, and Swiggy Instamart. Despite trolley bags being priced at Rs 2,000–3,000, the company said quick commerce currently contributes about 8% to total sales. It expects this share to rise to 15% by the end of FY25, depending on the expansion of dark stores and fulfilment capacity. 'Quick commerce is a very metro-focused phenomenon, and that is one channel growing at a very fast pace for us. Every month, we've been growing — last month we grew by 10%, and this month we will grow by another 10%. We expect the quick commerce run rate to reach 15% by the end of this financial year,' Daga reduce reliance on China and improve cost efficiencies, Nasher Miles has shifted a significant portion of its manufacturing to India over the past 18 months. While it previously sourced 90% of its products from China, today nearly 75% are made in India. The company claims this shift has helped cut costs by 20–25% and improve gross Miles initially created a sub-brand, Stony Brook by Nasher Miles, to test domestic manufacturing. With supply chains now stabilised, that brand is being phased out, Daga company, which had turned profitable earlier, went into the red in FY24 due to brand-building investments and the cost of testing Indian manufacturing but claims to have returned to profitability in FY25. According to Tracxn, Nasher Miles recorded a net loss of Rs 6.3 crore in FY24. In July 2024, Nasher Miles raised $4 million in a funding round led by the Singularity Early Opportunities Fund, Narendra Rathi of SoftBank Vision Fund, and Sulabh Arya of Goldman Sachs Growth Equity, among others, at a post-money valuation of $30 million, primarily to fund its omnichannel expansion. The company plans to raise additional funds after the festive season. 'We will actively go into the market probably post-season. The festive season is coming, and 50-60% of sales happen during these three to four months. So, we want to focus on execution first,' Daga said. Category diversification Currently, 92–95% of the company's revenue comes from trolley bags. However, it is now doubling down on other categories like backpacks and travel accessories, aiming to push their share to double digits by the end of this fiscal. The D2C luggage segment has seen growing investor interest. Last year, Mokobara raised $12 million in a round led by Peak XV Partners, valuing the company at $80 million post-money. In August 2024, venture capital firm Accel invested $9 million in Uppercase, nearly doubling its valuation to $60 million. Elevate your knowledge and leadership skills at a cost cheaper than your daily tea. India's gas dream runs on old pipes. Can a European fix unclog the future? Did Jane Street manipulate Indian market or exploit its shallowness? Newton vs. industry: Inside new norms that want your car to be more fuel-efficient Is gold always the best bet? Think again Do bank stress tests continue to serve their intended purpose? These large- and mid-cap stocks can give more than 24% return in 1 year, according to analysts Suited for the long term, even with headwinds: 8 stocks from healthcare & pharma sectors with upside potential of up to 39% Stock picks of the week: 5 stocks with consistent score improvement and return potential of more than 22% in 1 year
