Exclusive: Content Discovery Startup Inshorts Raises $5 Mn Funding From Tiger Global

Noida-based content discovery app Inshorts has raised $5 Mn funding from Tiger Global Management’s Singapore investment vehicle, Internet Fund III Pte Holdings. The investment, as per the company’s filings, was made in Inshorts’ Singapore-registered holding company in September 2017.

The amount was later transferred to the startup’s Indian subsidiary, Inshorts Media Labs. The capital has been secured from Tiger Global as part of a bridge round.

Speculations about the fundraise first surfaced in August this year, when it was reported that the New York-headquartered investment firm was in talks to lead a $10 Mn-$15 Mn round of funding in the media startup. Tiger Global has previously fuelled $20 Mn in Inshorts in July 2016.

Email queries sent to Tiger Global’s corporate communication team and Inshorts’ co-founder Deepit Purkayastha did not elicit a response till the time of publication.

An Overview Of The Inshorts Story

Founded in April 2013 by Azhar Iqubal, Deepit Purkayastha and Anunay Arunav, Inshorts (formerly known as News Inshorts) is a digital media startup that provides aggregated news items. Additionally, Inshorts works as a content discovery platform with videos, infographics, podcasts and blogs, among other kinds of content, in English and Hindi.

The Inshorts app provides news updates in 60 words or less, targeting the fast-paced generation. Users can also have a look at the detailed news byte, within the app. It also offers a personalisation option with ‘My Feed’ through its AI engine. The company currently has more than 5 Mn installs on Google Play alone.

The news aggregator has partnered with over 30 content global and five ecommerce players for distribution of content. It claims to have served “3 Bn shorts” till date. The startup raised its first round of funding in 2014, when it raised an undisclosed amount in funding from Times Internet, Flipkart co-founders Sachin and Binny Bansal; Gaurav Bhatnagar, Ankush Nijhawan and Manish Dhingra in a Seed round.

It further raised a sum of $4 Mn in a Series A funding round led by Tiger Global in 2015, along with other investors including Sachin Bansal and Binny Bansal and Japan’s Rebright Partners. The content discovery platform made its first acquisition in October of the same year, when it took over Palo Alto/Bangalore based startup, BetaGlide’.

The acquisition, according to Inshorts co-founder and CEO Azhar Iqubal, was aimed at enabling the app to track uninstalled users, draw insights on user experience and improve its user retention.

In November of 2015, the content discovery company announced the launch of Insiders, an exclusive community for ‘power users’ of the application. As stated by Iqubal at the time, members of Insiders were given first-hand experience of all new features developed by Inshorts. Around the same time, the platform made its entry into the vernacular mobile market with the launch of a Hindi interface.

In the digital media space, Inshorts currently competes with a number of players. Its biggest competitors are Dailyhunt and NewsBytes.

Tiger Global And Its India Bet

Founded in 2001 by Charles P. Coleman III, Tiger Global manages $10 Bn in private equity/venture capital and another $10 Bn in publicly traded equities. The firm invests globally, with China, India and the US being the most important markets at this point.

The firm marked its India entry in 2007 with $11.3 Mn (INR 77 Cr) investment in Just Dial. In 2008, it invested $5.9 Mn (INR 40 Cr) in offline coaching institute group TIME. Later, it also invested about $4.6 Mn (INR 30 Cr) in 2009 in JustDial and exited from the same in May 2015, for $64 Mn.

In 2015 alone, it made 38 investments in India with total disclosed investments of $1 Bn and each amounting to more than $5 Mn. The major ones included Ola ($400 Mn), Quikr ($150 Mn), Delhivery ($85 Mn), etc.

Apart from this, the firm has pumped over $1 Bn into Flipkart till date and held a 28% stake prior to the ecommerce giant’s last two funding rounds. In December 2016, it was reported that Tiger Global was in talks with Flipkart to participate in its funding round which could be up to $1 Bn.

As per another recent report dated March 2017, Tiger was in talks with SoftBank to ‘sell a part of its stake in Flipkart in exchange for a merger with Snapdeal. The report suggested that it was looking to divest a third of its shares in exchange for $1 Bn from SoftBank.

However in April, when the homegrown startup raised $1.4 Bn funding from Tencent, Microsoft and eBay, Tiger reportedly sold a part of its holding in Flipkart. Later in August, Flipkart secured another $2.5 Bn from Softbank Vision Fund, as an extension of the funding round in April. At the time, it was reported that a large portion of the investment was paid by Softbank to US-based hedge fund Tiger Global in exchange for one-third of its shares in Flipkart.

Most recently, in the fourth week of November, Tiger Global made headlines once again when Partner Lee Fixel stepped down from the Ola board. Soon afterwards, reports surfaced that the investment firm was looking to make partial exits from Flipkart and Ola for over $1 Bn. As per sources close to the development, it is currently holding talks to sell $500 Mn worth of stake in Ola to Japanese conglomerate Softbank.

Is Tiger Global Here To Stay?

In the last two years, the US-based investment firm has considerably slowed down its funding spree in India. As a result, in 2016, it participated only in four startup funding rounds. As per sources, Tiger Global is still aiming to cut its India bets. According to a Business Standard report, till May 2017, the firm had invested a total of $1.25 Bn in 101 Indian firms and managed to make seven exits, worth $473 Mn. This included Caratlane, Babyoye, Just Dial and a partial exit from MakeMyTrip.

According to a report by Satista, India’s digital media sector has generated upwards of $1.18 Bn Bn in 2017 so far. The country is currently home to the world’s second largest Internet-using population. With the newly-raised funding from Tiger Global, Inshorts is aiming to capitalise on the growing demand for digital media and has also set its eyes on expanding to the US. However, the question remains, could Tiger Global’s renewed interest in the content discovery startup indicate a shift in its investment strategy?