Pocket FM Eyes Unicorn Tag With Fresh Infusion From ADIA

Audio entertainment platform Pocket FM, which recently raised $103 Mn (INR 857 Cr) in its Series D funding round from Lightspeed and Stepstone Group, is in discussions for a fresh fundraise which will likely pave way for its entry into the unicorn league.

The startup has approached Abu Dhabi Investment Authority (ADIA) for its upcoming funding round, which is expected to value it at around $1.2 Bn, ET reported.

In the proposed ADIA-led round, there are plans for a secondary sale of shares by existing investors, potentially amounting to up to $100 Mn.

“The talks are still ongoing, but it should close at around $1.2 Bn valuations … There are few assets growing at a good pace at $150 Mn of annual recurring revenue. Their (Pocket FM’s) cost of production is low in India and they generate 70% of their revenues from overseas,” the report said, citing a source close to the matter.

This comes at a time when Pocket FM is looking to strengthen its presence in the US as well as to expand to Europe and Latin America markets, apart from strengthening its content library and creating a strong IP playbook for writers.

Founded in 2018 by Rohan Nayak, Nishanth KS and Prateek Dixit, Pocket FM is an audio series platform offering content across multiple languages and genres such as romance, self-help, and motivation.

It claims to have over 1 Lakh hours of content, including more than 2,000 exclusive audio series and 4 Lakh episodes across genres and languages in its platform. The startup said that it has surpassed $150 Mn ARR, and is growing at 57% QoQ. In the US market, its revenue has surpassed $100 Mn ARR.

“We are driving sustainable growth with robust unit economics and impressive gross margins, attracting significant investor interest worldwide. Currently, we are in talks with numerous investors to fuel our expansion. In 2023, our global annualized revenue run rate(ARR) surpassed $150 Mn, with the US market contributing over $100 Mn (ARR),” a company spokesperson told Inc42.

“Our audio series is redefining entertainment, setting the standard for blockbuster content with hits like Insta Millionaire, Saving Nora and The Return, each grossing over INR 100 Cr. Moreover, nearly 15 of our audio series have surpassed the $1 Mn revenue mark, showcasing our diverse portfolio of successful content,” the spokesperson added.

In FY23, Pocket FM’s India arm posted a 56% year-on-year (YoY) narrowed loss of INR 75.7 Cr and a 663% YoY surge in operating revenue to INR 129.7 Cr.