Tech giant Google is reportedly planning to buy out Bengaluru-based social media platform ShareChat for $1.03 Bn.
In August 2020, when news was rife that Microsoft may invest in the $100 Mn a funding round, reports suggested that ShareChat was valued at $650 Mn.
This speculation comes after ShareChat has recorded a 166% spike in its monthly active users base from 60 Mn during the pandemic to 160 Mn till now. Over these months, the daily average user time spent on the platform has also increased from 24 minutes to 31 minutes, the company’s cofounder and CTO Bhanu Pratap Singh had told Inc42.
While ShareChat declined to comment on the development, a Google spokesperson told ET Now that it doesn’t “comment on market speculation and rumours.”
ShareChat’s last funding round was in August 2019, 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.
Till date, the company has raised $222.8 Mn in eight funding rounds, according to data available on Crunchbase. ShareChat was part of Inc42’s UpNext series on soonicorn startups in 2019, and was expected to reach a $1 Bn valuation by 2021.
ShareChat started its journey in 2015 as a content-sharing tool for WhatsApp with users sharing about 100K content pieces per day. The company gradually evolved into a regional language-focused social media platform. It relies on user-generated content, and enables them to create, create, discover and share content with each other much like people do on Tumblr and Instagram.
ShareChat’s massive growth in 2020 can be attributed to two factors. First, the Covid-19 pandemic and the resultant lockdown, which pushed people further into digital adoption. According to data released by Carat India, smartphone usage increased by 1.5 hours a week and social media consumption nearly doubled to 280 minutes a day. India also hit 500 Mn internet users, riding on the growing popularity in the rural regions.
Secondly, the ban on Chinese apps like TikTok, Likee and WeChat has also pushed users towards ShareChat, which is an Indian alternative to these social platforms. ShareChat had achieved a growth rate of 500,000 new users per hour after the ban on Chinese apps. It currently has more than 100 Mn downloads on the Google Play Store.
In order to leverage it further, the company launched a short video app of its own called Moj. The Moj app has garnered over 80 Mn MAUs with users spending on an average of about 34 minutes on the platform. It has more than 50 Mn downloads on Google Play store. Like ShareChat, Moj too is available in vernacular languages, such as Hindi, Marathi, Bengali, Gujarati, Punjabi, Odia, Tamil, Telugu, Haryanvi, Rajasthani, and Urdu among others.
The social media platform’s growth in Tier II and Tier III areas is one of the main reason why Google is probably planning to buy ShareChat.