ShareChat meets Sher Khan


Good evening,

Ten Indian startups have become unicorns this year, including six in just the past week. To put things into context, 11 unicorns were born in India in all of 2020. Any guesses how many more we will see by the end of this year?

Unicorns

GIF Credit: Tenor

Also in this letter:

📱Why Gupshup raised money after 10 years
🛒Amazon India touts job creation
🎨NFTs and crypto art in India


1. ShareChat raises $502 million from Tiger and others

unicorn

The Tiger is on the prowl again. In the past two days, it has played a major role in minting three unicorns — Groww, Sharechat and Gupshup. This comes on the heels of the New York-based investment firm raising its 13th and largest global fund of $6.65 billion. Let’s talk about ShareChat first.

Driving the news: Regional language social media platform ShareChat has raised $502 million funding led by Tiger Global and participation from Lightspeed, Snap, and Twitter at a valuation of $2.1 billion. ShareChat has raised about $765 million to date.

  • The company claims to have 160 million monthly active users and is available in 15 local languages including Tamil, Malayalam, Bengali, and Assamese.

Moj launch: Last year the company forayed into short video with Moj, joining a dozen or more new players that entered India’s short-video market after TikTok was suspended last June. Other prominent players include Instagram Reels, Times Internet’s MX TakaTak, YouTube Shorts, Dailyhunt’s Josh, and InMobi’s Roposo. (Disclosure: Times Internet owns ETtech). Moj claims to have scaled up to 120 million monthly active users in nine months.

Quote: “We believe social graphs are not a necessity to rank and personalise public content. On both ShareChat & Moj, the content consumption is driven through an AI-powered content feed,” ShareChat chief executive Ankush Sachdeva said in a Medium post.

Also read:


Other key deals of the day

  • Car reseller platform Spinny has raised $65 million in a mix of primary and secondary funding, led by venture capital firm General Catalyst (an early backer of Snap), Airbnb and Stripe.
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  • Homegrown private equity fund ChrysCapital has acquired about 35% stake in personal care brand Wow Skin Science for Rs 370 crore ($50 million). The deal values the company at Rs 900 crore.

2. Gupshup lands $100 million

Unicorns

Hi, Vikas SN here. Conversational messaging platform Gupshup became the latest startup to join India’s rapidly expanding unicorn club that already crossed 10 members today. It raised $100 million from Tiger Global at a valuation of $1.4 billion.

I know what you are probably thinking. Yet another funding announcement of a unicorn. But what makes this story interesting is that Gupshup last raised capital a decade ago, in 2011. That seems like eons ago in the fast-paced tech and startup industry, where it’s not surprising for a company to see several funding rounds in a single year. Flipkart did this in 2017 and Byju’s did it last year.

You might remember Gupshup for its group text messaging service in the early and mid-2010s, however, it later pivoted to being an enterprise messaging platform, providing customer and brand engagement solutions for developers and large businesses across various sectors.

Beerud Sheth

So I spoke to Gupshup co-founder Beerudh Sheth on why they raised money after 10 long years and got his take on the unicorn valuations. Here are some excerpts:

On raising capital: “We haven’t needed the capital so far. Many of the recent tech companies have been raising money very rapidly and quickly, partly because their businesses are unprofitable and they really need extra capital to grow, otherwise they can’t survive. We’ve however run our business very prudently and profitably for a long time.”

So why now? “The pandemic has accelerated a lot of digital transformation, due to which our business has grown dramatically. We also see a massive market opportunity around messaging and conversations. We believe it is as big as the web was in the mid-90s, which created multiple giant companies.”

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“For opportunity of that scale, we really need to be more aggressive with our investments, be it expand globally or build out more products. To do this, we wanted to get more capital, and scale up very rapidly. It also enables us to explore potential acquisitions. I’m sure we will also look at a public listing down the road.”

Prunicorns? “I was recently talking to someone and was amused to hear this term. So there are, of course, unicorn valuations. And then there are prunicorns — profitable unicorns — which are even rarer than unicorns. A lot of companies get these (unicorn) valuations but sometimes if they don’t eventually become profitable then those valuations can also disappear as we’ve seen before.”

More capital incoming: Sheth said this financing is part of a larger round, with more investors expected to join later, which could provide an exit to some existing investors. Gupshup has raised a total of $150 million to date and counts CRV, Globespan Capital Partners and Helion Ventures among its backers.

Tweet of the day


3. Amazon creates 3 lakh jobs in India in 12 months

amazon

Amazon said it has created three lakh new jobs in India over the past year. This is one-third of the number of jobs that its founder Jeff Bezos had committed to achieve by 2025 when he visited India in January last year.

Amazon said it also facilitated exports worth $1 billion from India over the past 12 months, bringing the total cumulative exports from the country to $3 billion. Last year, Bezos had committed to exporting goods worth $10 billion from the country by 2025.

Amazon India country head Amit Agarwal said the e-commerce giant has also digitised 2.5 million small businesses so far. It plans to bring 10 million micro, small, and medium enterprises (MSMEs) by 2025.

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4. The status and future of NFTs and crypto art in India

NFTs (Non-Fungible Assets)are a key example of the type of innovation crypto-assets and public blockchains can lead to, which is why the blockchain and crypto-asset ecosystem should be encouraged in India, write Nishith Desai Associates leaders Jaideep Reddy, Meyyappan N and Vaibhav Parikh in a column for ETtech.

They also touch upon dealing in NFTs in India, how cross-border transactions would work under the country’s laws, what intellectual property issues could emerge with NFTs, and how they could be taxed. Read the column here.


5. Byju’s set to go global with Future School

Edtech giant Byju’s is making its biggest international push with its new product Byju’s Future School in the US, UK, Brazil, Indonesia and Mexico next month.

Details: The product will be headed by WhiteHatJr founder Karan Bajaj and will initially offer maths and coding tutorials. It will be expanded later to include science, music, English and fine arts classes.

Languages: About 11,000 women teachers from India will cater to students in English-speaking markets and the company will look to hire teachers in Mexico, Brazil and Indonesia to cater to non-English-speaking students. The coding curriculum will also be made available in Spanish and Portuguese.

  • WhiteHatJr will now be folded into the Byju’s Future School brand. The platform is clocking an average 20,000 live sessions per day taught by over 7,000 teachers, while the number of classes on the weekends doubles to 40,000, Bajaj said.

Last week, Byju’s acquired offline tutorial chain Aakash Educational Services Ltd (AESL) in a cash and stock deal estimated at $950 million, its largest acquisition to date.

Today’s ETtech Top 5 was curated by Vikas SN in Bengaluru and Apoorva Mittal in Mumbai.





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