American eCommerce giant Amazon has announced a $250 million venture fund to invest in Indian startups and entrepreneurs focusing on digitization of small and medium-sized businesses (SMBs) in its key overseas market.
The announcement comes at a time when the billionaire Jeff Bezos-owned group, which has previously invested over $6.5 billion in its India business, faces heat from government bodies and SMBs that it wants to serve.
Through the new venture fund, called Amazon Smbhav Venture Fund, Amazon said it wants to invest in startups that focus on helping small businesses come online, sell online, automate and digitize their operations and expand to customers worldwide.
Agriculture and healthcare
Agriculture and healthcare are two additional areas Amazon is focusing on with its new venture fund, but it said it is open to looking at tech startups from other sectors if their work intersects with SMBs.
In the agri-tech sector, Amazon is looking to invest in Indian startups that are using technology to make agri-inputs more accessible to farmers, provide credit and insurance to farmers, reduce food wastage, and improve the quality of produce to consumers. In the healthcare sector, Amazon said it will invest in startups that are enabling healthcare providers to leverage telemedicine, e-diagnosis, AI powered treatment recommendations.
The announcement was made at Amazon’s annual event, called Smbhav (which means ‘possible’ in Hindi), that focuses on India-based SMBs. At the virtual event, Amazon also unveiled ‘Spotlight North East’, an initiative to bring 50,000 artisans, weavers and small businesses online from the eight states in the North East region of India by 2025 and to boost exports of key commodities like tea, spices and honey from the region.
In the first edition of Smbhav last year, Amazon announced it would be investing $1 billion to help digitize 10 million small and medium sized businesses. Amazon said earlier this month that it had created 300,000 jobs in India since January 2020, and enabled exports for Indian-made goods worth $3 billion.
The company said more than 50,000 offline retailers and neighborhood stores are using Amazon marketplace and about 250,000 new sellers have also joined the platform. The company said today it aims to onboard 1 million offline retailers and neighborhood stores by 2025 through the Local Shops on Amazon program.
During Smbhav’s first event last year, which was attended by Amazon chief executive and founder Jeff Bezos, tens of thousands of protesters marched on the street not far from the location and expressed their concerns about what they alleged was unfair practices employed by Amazon to crush them.
A similar protest was observed at this year’s event, where traders expressed their concerns at an event they named Asmbhav (Hindi for ‘impossible’) demonstrating an ongoing challenge for Amazon, which has long struggled to stay out of controversy in India.
An influential India trader group that represents tens of millions of brick-and-mortar retailers called the government to ban Amazon in the country in February this year after a report claimed that the American eCommerce group had given preferential treatment to a small group of sellers in India, publicly misrepresented its ties with those sellers and used them to avoid foreign investment rules in the country.
Several international technology giants including Google, Facebook and Microsoft have invested in Indian startups in recent years. Amazon, too, has backed a number of firms including ride-hailing startup Shuttl, and consumer brand MyGlamm. Last month, it acquired retail startup Perpule for about $20 million.