The year 2020 brought on a rather bewildering change in our lives owing to COVID-19. While we were just getting comfortable working from home or staying at home and making or watching reels on TIKTOK, the government of India suddenly announced its ban. Suddenly, a majority of the youth did not know what to do with their free time. Having said so, TIKTOK being a Chinese app did have its drawbacks. While ShareChat – an Indian app was already around since 2015, it had not gained a lot of success. After TikTok was effectively banned by the government, Mohalla Tech Pvt. Ltd. released ShareChat in a new avatar in June 2020. Currently valued at a staggering $2.1 billion, the app has over 18 crore users. Read on further to stay updated with the successful journey of this Indian app.
About ShareChat
All of this began when the co-founders realized that there is a group of users who wanted to express themselves but could not because of language barriers. Therefore, in an ideal world, this regional audience would have its own preferences for how it consumes content, preferences that social products used by the metro audience most definitely cannot satisfy. Before ShareChat entered the picture, the co-founders claim that this regional segment of the audience was largely untapped and the market was largely unexplored. ShareChat was created in this way in 2015 by three brilliant individuals who built on a broad insight to create a million-dollar startup.
Today, ShareChat is thought to be India’s fastest-growing regional language social media platform. It has more than 180 million active users each month who use 15 regional Indian languages.
About the Founders
The founders, three IITians from IIT Kanpur – Bhanu Singh, Farid Ahsan and Ankush Sachdeva met after completing their college in 2015 through a Whatsapp group. Before then, Ankush had already tried 17 startups that failed. A certain Facebook growth hacker invited all of them to join his Whatsapp group. The three friends united via this group and together wrote a code that later went on to become ShareChat.
Within just three months, the app had amassed 1 lakh downloads and was quickly becoming very popular. People started to adore the platform, and soon Sharechat received funding from India Quotient of Rs 50 lakh. Ankush Sachdeva shifted to using User Generated Content (UGC) for Sharechat in 2016.
Business Model
The content marketing groups online primarily use two different types of business models. The first one aids in the development of a network where the platforms’ owners both produce and own the content. The second type of model, on the other hand, is what helps customers create a large portion of the content. ShareChat uses the latter.
ShareChat aspires to be a well-known social networking site where people can post photos and videos, chat with others, create content, make friends, and more. However, unlike other social media platforms, this app supports message delivery in all of India’s regional languages. Users can earn money on ShareChat without paying a fee. Instead, it makes money through payment transactions, advertisements and sponsorships.
Initial Challenges
Trying to teach the audience what a feed is, why you follow someone, and why you create content was one of the biggest challenges ShareChat’s founders faced. Because of that, the new emerging Indian audience finds it incredibly difficult to use Facebook, Twitter, or Snapchat.
Funding
$224 million has reportedly been raised for ShareChat.
- Seed Investment: In July 2016, SAIF Partners invested $1.4 million in ShareChat’s seed investment round.
- Series A Funding: In November 2016, the business secured $4 million in Series A funding from investors including Lightspeed Venture Partners and others.
- Series B Funding: In January 2018, it raised $18.2 million in a Series B investment round from Xiaomi Singapore and Shunwei Capital, a sister company.
- ShareChat received $100 million in Series C funding in September 2018 from Shunwei Capital, Jesmond Holdings, and Chinese investors Morningside Ventures. A sizeable amount was also invested by SAIF Partners, Lightspeed Venture Partners, and Xiaomi.
- Xiaomi and Lightspeed Venture Partners each contributed a sizeable sum.
- Earlier investors SAIF Capital, Lightspeed Venture Partners, Shunwei Capital, Morningside Venture Capital, and India Quotient joined Twitter and Trust Bridge Partners in August 2019 to fund the company’s Series D investment round, which saw a total investment of $100 million.
Revenue
The revenue figures for ShareChat were not particularly impressive in the most recent fiscal year (FY20), when the business spent Rs 715 crores while only earning Rs 9.4 crores. A loss of Rs 676 crores was experienced during FY20, of which ShareChat suffered a loss of Rs 329.4 crores in marketing and business development. The business anticipated the upcoming fiscal year’s results with great anticipation.
We can see that ShareChat had a strong year of growth now that its FY21 financials have been made public. A true turning point for Sharechat occurred in 2021. With the Series E round, which brought in $502 million for the company, the business became a unicorn. The revenue generated by ShareChat increased by 754.3% to reach Rs 80.3 crore, which is more significant.
Future Plans
ShareChat promises significant changes to the way the application works in the near future. Users should reasonably anticipate a much greater variety in content formats. Additionally, users can anticipate seeing a greater number of content producers become famous and other famous people on ShareChat. Additionally, India has more than 1600 known dialects and 22 official languages. ShareChat therefore wants to serve more localized audiences. The platform does not want to focus solely on India. With more than 130 million active monthly users (MAUs), ShareChat has been attempting to capitalize on TikTok’s absence from India due to the government’s ban.
ShareChat and MX TakaTak have already merged, and the combined platform aims to reach 100 million creators, 300 million monthly active users, and nearly 250 billion video views.
Final Thoughts
Little by Little, this amazing content-sharing platform in India is bringing a new wave of expression wherein Indians can express their opinions and ideas in a language they are comfortable in. Kudos to the founders’ team to think of this desi app with a desi soul.
