ShareChat’s FY21 Loss Up 114% to INR 1,446 Cr, Expenses Jump To INR 1,543 Cr

Indian social media platform ShareChat’s net loss widened 114% to INR 1,446.4 Cr in the financial year 2020-21 (FY21), regulatory filings by its parent company Mohalla Tech Private Limited showed. 

In FY20, the startup had reported a net loss of INR 676 Cr, which was 22% higher than its loss in FY19.

ShareChat’s revenue from operations surged nine-fold to INR 80.3 Cr in FY21 from INR 9.4 Cr in the previous fiscal. Total revenue for the year more than doubled to INR 96.9 Cr from INR 38.1 Cr in FY20, even as revenue earned from other sources decreased 42% year-on-year (YoY) to INR 16.6 Cr in FY21.

The startup’s total expenses surged over 116% YoY to INR 1,543.3 Cr in FY21, led by a rise in employee benefit expenses and other expenses. 

While its employee benefits expenses jumped to INR 174 Cr from INR 80.3 Cr in FY20, other expenses grew to INR 1,355.3 Cr from INR 628 Cr in the previous fiscal year.

Other expenses include the loss on fair value of convertible preference shares, classified as liability, music contract expenses, and content onboarding expenses.

ShareChat’s finance costs jumped to INR 6.4 crore in FY21 from just INR 40 Lakh in FY20.

The startup saw a rise in expenses despite laying off 101 employees, or about one-fourth of its total workforce, in May 2020 following Covid-19 pandemic-related uncertainties.

“The global pandemic along with various local market uncertainties have 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,” the startup had said then. 

ShareChat, founded by Ankush Sachdeva, Farid Ahsan, and Bhanu Pratap Singh in 2015, currently has 180 Mn monthly average users (MAUs), as per its website. The startup has over 2,000 employees.

In April last year, ShareChat joined the unicorn club with a $502 Mn Series E funding round led by Lightspeed Ventures and Tiger Global. 

The Covid-19 pandemic and the resultant lockdowns pushed the adoption of digital services and platforms, helping startups like ShareChat. Moreover, days after India’s ban on Chinese app TikTok in July 2020, ShareChat claimed that it was seeing an addition of 500,000 new users per hour.

Earlier this month, ShareChat raised $255 Mn from Google, Temasek, Times Internet, and other investors.

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