Sharechat, an Indian vernacular social networking application will soon be receiving an investment of more than $50 million (₹347 Cr) from Twitter as per reports.
This is the first time Twitter is investing in a company. The social media giant usually prefers buying out the companies that it is interested in.
This investment from Twitter will help ShareChat in leveraging its reach against the competition.
Sharechat which is an Indian vernacular social networking application will soon be receiving an investment of more than $50 million (₹347 Cr) from Twitter as per reports. This investment will be the first of its kind for the social networking giant. Twitter may also get a minority stake in the social media app as a part of the deal. Jack Dorsey, the founder of Twitter is reportedly directly involved with this deal.
This is the first time Twitter is investing in a company. The social media giant usually prefers buying out the companies that it is interested in. only one Indian company has been brought out by twitter so far. Zipdial was acquired byTwitter in 2015 for an astonishing capital of $40 million. Twitter is interested in ShareChat as it looks to reach out to users in India beyond metros. The company is also running financial losses as its revenue has declined by 14% in 2018. Currently, Manish Maheshwari leads the Indian operations of twitter. Commenting on the investment in ShareChat, he said that as premium Indian content is on the rise as of today, they have barely scratched the surface of the possibilities for Twitter in the Indian market.
Apart from Twitter, other companies like Xiaomi, Morningside capital and ShunweiCaptial are also going to participate in the $100 million (₹ 697Cr) funding round of Sharechat.
ShareChat was founded by IIT Kanpur alumni, Farid Ahsan, Bhanu Singh and AnkushSachdeva in 2015. It is currently based in Bangalore. The app lets users create and share content with its users. It also has features like anonymous chat and Direct messaging. Apart from these, it also allows its users to create original video content under the name of ShareChat talkies.
The company has been trying to attract investments since its last investment of $100 crore (₹697 Cr) in 2018. It was valued at $460 million as of last year which is an increase of almost 7 times since its last valuation at $67 million. The company has received investments of $122 million till today. ShareChat is also reportedly in talks with investors including Tencent holdings Ltd with the aim of raising $200 million. ShareChatwas also included in the coveted 42Next by Inc42 of India’s most innovative start-ups’list in 2018.
ShareChat is currently accessible in 24 languages and is immensely popular in tier 2 and tier 3 cities across India. The company has increased its users from 5 million in May 2018 to 8 million by the closing of that year. It also recently made an acquisition of Clip, a video sharing application. The company is all set to integrate Clip into its app so as to help compete better in the deeper markets. Currently, ShareChat is facing serious competition from Chinese apps like TickTok and Helo. A staggering 39% of the TikTok’s global user base is comprised of Indians in the age group of 16-24. The user base of another Chinese app like comprised 34% of Indians. This was also the third most downloaded app in India in 2018. This investment from Twitter will help ShareChat in leveraging its reach against the competition.
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