Google is in talks with regional language-focussed social media platform ShareChat for investing, according to a recent report. The Bengaluru-based company is looking to raise $150 Mn -200 Mn and is holding discussions with investors and technology giants.
The news comes in at a time when ShareChat is preparing to battle it out with over a dozen rivals to fill the gap left by banned Chinese apps, including TikTok and Helo. The company recently launched TikTok rival called Moj.
Last week it was reported that Microsoft might invest $100 Mn in the social media platform. The company’s last funding round was in August last year, when it raised $100 Mn in a Series D round led by Twitter, with existing investors Shunwei Capital, Lightspeed Venture Partners, SAIF Capital, India Quotient and Morningside Venture Capital also investing further. That funding pegged the company’s valuation at $650 Mn.
JPMorgan is advising ShareChat in raising funds.
Till date, the company has raised $222.8 Mn in eight funding rounds, according to data available on Crunchbase. ShareChat is amongst the 53 startups that have the potential to become unicorns by 2022, according to DataLabs by Inc42+.
“A process is on to raise funds. We have reached out to funds as well as strategic investors like Google. The talks are still at a preliminary stage and will take some time to conclude. As Chinese tech applications are banned, we expect larger investor traction for ShareChat, which directly competes with ByteDance’s Helo,” one of the people told ET.
“Given how things have changed, especially after the ban, ShareChat benefits a lot in terms of time spent, in terms of revenue, in terms of daily active users. We are suddenly a lot more valuable than our previously thought valuation. We have got a lot of inbound interest and we are talking to everyone, including all the global players,” ShareChat chief executive Ankush Sachdeva told the publication.
The development comes as ShareChat has started getting more traction after the exit of 59 Chinese apps, including its rival Helo. The company registered over half-a-million downloads every hour after the ban of 59 Chinese app, taking its total to 15 Mn downloads in 36 hours. The company was founded in 2017 by Ankush Sachdeva, Bhanu Pratap Singh and Farid Ahsan. In the short video space, ShareChat competes with Instagram Reels, Mitron, Bolo Indya and Chingari. The Bengaluru-based company has Shunwei Capital, Xiaomi, Lightspeed India Partners, SAIF Partners, Google Launchpad Accelerator as its key investors. To date it has received $222 Mn funding from its investors.
Earlier, in May 2020, ShareChat announced layoffs of 101 employees or nearly one-fourth of its workforce due to the Covid-19 pandemic and local market uncertainties.
ShareChat cofounder and CEO Ankush Sachdeva told his employees that 101 employees are being let go and shared various cost-cutting measures.
Confirming the layoffs, the company spokesperson told Inc42, “The global pandemic along with various local market uncertainties has had an impact on our business plans. This has pushed us towards certain tough decisions including a revised leaner structure while we continue to grow. We’ve had to let go of 101 of our employees who’ve been part of our startup journey. This was not an easy decision to make.”