Daily Tech Snippet: Monday, January 18

• Modi Offers $1.5 Billion Fund, Tax Breaks for India Startups: India said it will set up a 100-billion-rupee ($1.5 billion) fund to encourage startup businesses and pledged to ease regulations for entrepreneurs, as Prime Minister Narendra Modi strives to create the jobs needed in a developing nation of 1.3 billion people. Startups will get tax breaks such as income-tax exemptions for the first three years, quicker patent applications, a credit guarantee program and easier routes to wind up if they fail, Modi said at a government conference for entrepreneurs in New Delhi. The fund will be established over four years. "The government should not interfere in startups," Modi said on Saturday to an audience that included billionaire Masayoshi Son, the founder of Japan’s SoftBank Group Corp., and Uber Technologies Inc. Chief Executive Officer Travis Kalanick. "India’s youth should be a job creator, not a seeker."

• Jawbone Raises $165 Million at Half Its Last Valuation: Jawbone, the once-hot wearable technology start-up, said on Friday that it had raised $165 million in funding at a valuation of $1.5 billion, or roughly half the amount that the company was valued at as recently as 2014, continuing a burgeoning trend of start-ups raising money at lower values than before. When private companies raise money at a lower value than they had previously, the event is known as a “down round.” On Thursday, Foursquare announced it had raised a $45 million round of venture capital — which people familiar with the terms have said was also a down round, with Foursquare valued at $250 million, less than half of the $650 million it was valued at during its last round in 2013. Down rounds are increasing as Silicon Valley sobers up somewhat after a frothy period. In the last quarter of 2015, there was a major investment slowdown; funding to private companies dropped 30 percent from the previous quarter, to $27.3 billion, the research firm CB Insights said. Mutual fund investors have also recently marked down the valuations of other high-profile private companies like Zenefits, Dropbox and Snapchat. Down rounds, like the ones that Jawbone and Foursquare have raised, tend to destroy value for all of the pre-existing shareholders, including employees who own the company’s private stock. It has been a tumultuous year for Jawbone, which is based in San Francisco. The company’s Up fitness band line faces stiff competition in a crowded market for wearable technology that is dominated by Fitbit and Apple, according to the research firm IDC. Last year, Jawbone laid off employees as part of a restructuring. The company raised nearly $300 million in debt from the money management firm BlackRock last April.

• As Delivery Startups Cool, Food-Delivery Startup DoorDash Eats Its Words in Fundraising Talks: The company lowered its ambitions by cutting as much as $400 million off its proposed valuation to investors. In meetings late last year, DoorDash pitched venture capitalists on an investment that would value the food-delivery company at $1 billion, people with knowledge of the matter said. The company is back on the fundraising trail for that same round, except this time it’s slashed its lofty goal to as low as $600 million, according to the people, who requested not to be named because the discussions were private. If DoorDash closes the financing at the terms proposed to some investors recently, the valuation would be around the same as the one from the last round in March 2015, which was $600 million, the people said this week. The talks are ongoing, and the terms could change again, they said. A spokesman for DoorDash declined to comment. The comedown for DoorDash shows delivery startups may be losing some of their allure. Such businesses are costly to operate and often take on huge losses in pursuit of growth. Instacart, the grocery-delivery company that was valued at $2 billion by investors, raised prices in December, a move it attributed partly to “changing market conditions.” It also cut staff, according to Re/code. Good Eggs, which works with farmers to deliver fresh produce, closed all of its operations outside San Francisco in August.

• Alphabet (formerly known as Google) Shakes Up Its Robotics Division:  Google’s robotics division has been plagued by low morale and a lack of leadership since the unit’s founder left abruptly in 2014. Now Alphabet is cleaning it up. Over the last two months, Alphabet, the new holding company that separated Google from its collection of speculative projects, has reframed the robots effort, moving it from a stand-alone division inside Google to a piece of the X research division. The company has also hired Hans Peter Brondmo, a technology industry veteran who last worked at Nokia, to help with management. A reorganization of the robots group is one of several recent moves inside the X division, which used to be called Google X but was rebranded with the Alphabet reorganization and recently unveiled a new logo. A range of companies, including tech competitors like Amazon and car manufacturers, are signaling their interest in robotics. X has several projects in varying degrees of completion, but has lately been “graduating” them as stand-alone companies or preparing them for such a move. The life sciences group, for example, is now called Verily. X also recently hired an auto industry veteran to lead its self-driving car effort — called Chauffeur internally — and noted that the project was a good candidate to be spun out. Robotics has gone in the opposite direction for reasons that are personal and practical. The division was created in 2013 by Andy Rubin, who led the development of the widely used Android operating system software, and it has been without a leader since Mr. Rubin left in 2014 to start a technology incubator that helps young start-ups turn their ideas into businesses. After starting the robotics division, Mr. Rubin quickly went on a buying spree, purchasing a number of promising companies, including Boston Dynamics, the maker of experimental military robots, and Schaft, an elite group of Japanese roboticists from the University of Tokyo. But while the companies were promising, Mr. Rubin invested in several technologies that had industry observers scratching their heads about his overall direction. Mr. Rubin originally said that the robotics division would be a 10-year moonshot, and when he was in negotiations to acquire companies he talked about the possibility of the driverless Google car rolling up to your house and the Google robot jumping off the back bumper. Google’s robotics effort stalled after his departure, going through a variety of leaders, including James Kuffner, a Carnegie Mellon roboticist who has since joined Toyota’s research and development laboratory in Palo Alto, and Jonathan Rosenberg, who is a troubleshooter for Larry Page, the Google co-founder who is Alphabet’s chief executive. Many in the industry say it is likely to be awhile before companies, Alphabet included, can get through the many technological and regulatory hurdles that stand in the way of robots becoming a huge business.

• Xiaomi Misses Smartphone Sales Target by 10% on China Slowdown: Xiaomi Corp. sold more than 70 million smartphones last year, falling well short of its target and prompting founder Lei Jun to tell employees he was refocusing research efforts into “cool stuff” like robotics and virtual reality. The Chinese startup had a stated goal of selling 80 million devices. Xiaomi originally predicted selling 100 million units, but then changed that after China set its lowest growth target in 15 years and copycat vendors started taking away market share. The miss was a blow to company morale, Lei said in an e-mail to employees. “We set a target of 80 million and, before we knew it, it became an obligation,” Lei said. “We changed under this pressure, and everyone’s faces gradually lost all traces of humor.” The smartphone maker was one of China’s most exciting startup stories of past years, with a valuation of $45 billion that trailed only that of Uber Technologies Inc. Xiaomi thrived through online sales of budget-priced devices with advanced components, overtaking domestic competitors and challenging Apple Inc. and Samsung Electronics Co. for supremacy in the world’s biggest market. Xiaomi’s market share has been pinched by competitors including Huawei and Meizu, said Jeff Pu, an analyst at Yuanta Securities Co. They are among the Chinese vendors that have flooded the Internet with ultra-thin phones offering similar features and prices to Xiaomi’s Mi 4i and Redmi Note 2. Huawei said it shipped more than 100 million smartphones last year as it expanded in the U.S. and Europe, defying an industry slowdown. Pu expects Xiaomi’s sales growth to slow to 10 percent this year. “With sales growth slowing, Xiaomi’s valuation will be hurt,” Pu said. “It could even face a down round, as investors are less willing to pay.”