 "ShareChat")
Mohalla Tech, the parent company behind short-video platform Moj and regional social network ShareChat, is in the process of raising about $300 million in fresh funding from Alphabet Inc's Google, Singapore's Temasek Holdings and media firm Times Group, according to people familiar with the matter. The funding has increased the valuation of the firm to $5 billion from its previous valuation of $3.7 billion.
A ShareChat spokesperson declined to comment on the development and a Google spokesperson said “it doesn’t comment on speculation like this.”
According to the sources, the funding is expected to help Mohalla Tech to build deep capabilities in areas such as social and live commerce, growing its artificial intelligence and machine learning (AI/ML) team which is now over a 100 people strong and spread across the US, Europe and India. Mohalla Tech has today one of India’s largest AI/ML teams working on building a cutting edge recommendation engine. It is expected to further strengthen the firm’s position and help it deliver immersive social experiences to our community
Last December, Mohalla Tech, the parent company behind short-video platform Moj and regional social network ShareChat, raised $266 million as part of its Series G round. At a valuation of $ 3.7 billion, the investment was led by Alkeon Capital with participation from new and existing investors including Temasek, Moore Strategic Ventures (MSV), Harbourvest and India Quotient. This is the third round of funding for the startup in 2021. In July this year, the firm’s valuation was $2.9 billion after it raised $145 million as an extension of its Series F.
Since January 2021, the company has grown to over 2000 employees and added several new features as it focuses on building its products to be the leader in the Indian short video and social media space. With social and live commerce initiatives, the company is expecting to reach a target of $100 million annualized creator earnings by the end of 2023.
Founded in 2015, Mohalla Tech had raised over $1.177 billion across eight fundraising rounds with $913 million raised last year itself. This helped both Moj and ShareChat to continue their growth journey, differentiate and deliver immersive social media experiences. Moj had said it is India’s number one short video app with the highest monthly active users base, with an average user time spent of 34 minutes every day, scoring over 4.5 billion views daily.
ShareChat, the Indic language social media platform, had said it is positioned uniquely with an average user time spent of 31 minutes daily. Moj and ShareChat together, with a 340 million-strong user community, envision building a cohesive AI-powered content ecosystem to address India’s growing digital needs.
Experts said that the opportunity is huge as India is one of the fastest-growing and most dynamic internet markets in the world – with an estimated 600 million (mostly mobile) internet users.
This is Google's second key investment in India's short video space. It had already backed
VerSe Innovation, India’s biggest local language technology platform. In April this year, VerSe raised and signed definitive documents for $805 million in the latest funding rounds from marquee global investors which will raise the firm’s valuation to $5 billion. The $805 million investment followed close on the heels of over $650 million fundraise from investors such as Siguler Guff, Google, Microsoft and Qatar Investment Authority taking the total capital raised in the past year to $1.5 billion.VerSe Innovations is the parent company of short video platform Josh and digital media platform DailyHunt.
VerSe Innovation’s proprietary technology platform serves one out of every two internet users in the country across Josh and Dailyhunt, coupled with PublicVibe, the fastest-growing hyper-local video platform.
The firm had said Josh has over 150 million MAUs (monthly active users), the best DAU/MAU ratio in the industry of 49 per cent and the highest retention. Dailyhunt serves over 350 million users every month offering content artefacts every day in 15 languages. PublicVibe serves over 5 million MAUs and 1 million daily active users (DAUs) and has over 6 million downloads on Play Store.
The funding round for Mohalla Tech comes at a time when top investors such as Sequoia and SoftBank have raised concerns about profitability and may make lesser investments.
Sequoia is one of the most active investors in India and has backed top unicorns such as Byju’s, Oyo, Ola, Zomato, Meesho, Car24, Unacademy, BlackBuck, Pine Labs, Freshworks and Razorpay.
Sequoia Capital has told the founders and CEOs of its companies that the era of being rewarded for hypergrowth at any cost is quickly coming to an end with investors shifting focus on companies that can demonstrate current profitability.
Falling valuations, slowing funding rounds and faltering investor sentiment, have prompted many Indian start-ups to lay off employees in a bid to conserve cash. SoftBank-backed Unacademy may see a funding dry spell for at least next 12-18 months and even last till 24 months and will cut costs to weather the lean period, said the chief executive of the education technology unicorn that recently laid off more than 600 employees.
Sequoia-backed sports fantasy unicorn Mobile Premier League (MPL), has reportedly sacked 10 per cent of its team, or 100 employees, and has decided to pull out of Indonesia.
Cars24, a leading e-commerce platform for pre-owned vehicles, has laid off over 600 staff. Another edtech unicorn Vedantu laid off 424 employees — about 7 per cent of the company’s workforce. The layoff took place days after the company fired 200 of its contractual and full-time employees.
