Home-grown social media app ShareChat entered the growing and mythical ‘unicorn’ family of Indian startups, after it raised $502 million in a Series E funding round, led by venture firms Tiger Global and LightSpeed Ventures. This round put its valuation at $2.1 billion, thus marking its entry into the bigger league of global social media players.
Other investors who participated in the round included photo-messaging app Twitter and popular social media platform Twitter. ShareChat has raised about $765 million to date.
According to ShareChat, the proceeds from the fundraiser will be used to acquire new users, build the creator economy and also strengthen the start-up’s artificial intelligence-based tools. “There will be significant investment in content moderation too,” said ShareChat co-founder and CEO Ankush Sachdeva. ShareChat aims to acquire a billion users and expand beyond the vernacular market. It is available in 15 local languages including Tamil, Malayalam, Bengali, and Assamese.
The latest unicorn to emerge this year after Gupshup, Groww, PharmEasy, CRED, Meesho, Digit Insurance, Innovaccer, Infra.Market and Five Star Business Finance (NBFC), ShareChat has over 160 million users and has a large following in small Indian cities and towns.
“We are at a significant inflection point in our company’s journey — as the internet penetration further deepens in India we are well-positioned to expand our ecosystem of products to 1 Billion+ MAUs cumulatively,” Sachdeva said in a blog post.
“As Internet penetration increases, ShareChat’s leading content creation platform is poised to expand dramatically by bridging into online purchases of goods and services. Additionally, Moj is well-positioned to seize the opportunity presented by the growth of short video in India,” said Ravi Mhatre, Partner at Lightspeed Ventures.
ShareChat’s short-video sharing platform Moj, launched after the ban of ByteDance’s TikTok and a host of other Chinese apps owing to border tensions between India and China, has witnessed an upsurge in demand as users have been racing for alternatives following TikTok’s ban. It today has a user base of nearly 120 million, which is impressive considering it is less than a year old. It achieved the milestone of 50 million downloads within 45 days of its launch and ranks in the top three among home-grown short-video apps, grouped with MX Takatak and Josh.
“Only two things matter, AI, and access to capital and we will make sure that on both these fronts we are way, way ahead of our competition,” said Sachdeva.
“When we saw a large vacuum emerge on June 29 with a lot of short-video apps exiting the market — we knew this opportunity was for us. There were millions of short-video creators already trained for creating that content supply. The real game was therefore going to be on building the most relevant feed for the user and we were the only Indian company that had built a world-class feed recommendation system for short-form content,” Sachdeva wrote in a blog post. “We built the app in 30 hours.”