Indian social media company ShareChat has raised more than half a billion dollars to develop its popular Moj short video app, just months after the Indian government banned ByteDance rival TikTok from the country.
The five-year-old company, which has raised $ 502 million from investors including Tiger Global Management, Snap and Twitter, now has a valuation of $ 2.1 billion. The ShareChat app has 160 million monthly active users, while Moj has amassed over 120 million monthly active users within nine months of launch.
Indian government ban over 200 Chinese at the end of last year, as a result of a border dispute, was a “macro event. . . and we took advantage of it, ”said Ankush Sachdeva, managing director of ShareChat, which also counts Shunwei Capital, launched by the founders of Chinese mobile phone maker Xiaomi, among its investors.
“ShareChat has multiplied after this ban. . .[and] we also took advantage of the short video void and launched Moj, ”he added.
Bangalore-based ShareChat offers its memes and video sharing platforms in 15 Indian regional languages, but not English, making it extremely popular among Indian smartphone users in small towns and villages, where l English is not the preferred language. Users of both apps spend an average of more than 30 minutes each day, according to the company.
For US tech companies, India represents a huge growth opportunity. Only 40% of the population had an internet connection in 2019, according to McKinsey, and 86% of them were under 40 years old. By 2025, the number of internet users is expected to exceed 970 million, according to Statista.
“As internet penetration increases in semi-urban and rural economies, ShareChat’s. . . The platform is poised to grow dramatically by connecting to online shopping for goods and services, ”said Scott Shleifer, partner at Tiger Global Management, who invested in the company’s latest E Series.
“Meanwhile, Moj is well positioned to seize the opportunity presented by the growth of short video in India. We are impressed with the team’s understanding of these rapidly evolving technologies and their ability to execute quickly, ”he added.
In the void left by TikTok, Indian users were offered a dizzying array of options for entertaining short videos. Apps that have sprung up in the past year include Josh, TakaTak, Roposo, Mitron, and Chingari. Google and Microsoft recently invested in Josh’s parent company, while Google also led a $ 145 million investment in the company behind Roposo.
ShareChat claims to stand out with its content recommendation technology. The apps use machine learning algorithms to deliver personalized content to individual users, based on their tastes. “Machine learning is a very big investment area for us. [We are] build all this infrastructure and grow our team around the world, ”said Sachdeva.
The company has hired five artificial intelligence directors in the US and UK in the past six months and doubled its workforce in the second half of 2020, including 50 AI engineers.
Competition between US and Chinese tech giants for the Indian market has intensified in recent years, spurring multi-billion dollar bets in start-ups in the country. Following a bloody border clash between Indian and Chinese soldiers in June 2020, animosity from the Indian government spurred Chinese investment offers to freeze, paving the way for US investors looking to expand beyond India’s fertile internet market.
In the past week alone, two other start-ups – social commerce app Meesho and fintech Cred – have raised funds at a valuation of over $ 2 billion from US investors, including Facebook and Tiger Global. respectively.