ShareChat closes $520 mn funding round at $5 bn valuation

ShareChat parent Mohalla Tech Pvt. Ltd. has raised $520 million via multi-tranche funding round at a $5-billion valuation. In the first part of the funding round, ShareChat raised $266 million in December 2021 from Alkeon Capital, Temasek, HarbourVest, Moore Strategic Ventures, and India Quotient. In the final tranche, post the acquisition of MX TakaTak, ShareChat added Google and Times Group as new investors, while Temasek participated yet again, adding $255 million.

Bengaluru-based ShareChat, which achieved the unicorn status last year, says it raised $913 million in total in the year 2021. This, says ShareChat, is the highest funding among all companies that became unicorns during the year.

Ankush Sachdeva, CEO & co-founder, ShareChat and Moj, says the company closed the funding round with the addition of Google and The Times Group to its cap table. "We are also happy and grateful to see Temasek reaffirming its faith in us for the third time in a year. Despite strong headwinds, it is reassuring to see investor confidence in ShareChat’s efforts and potential to grow further," he adds.

Besides the ShareChat app, the homegrown social media company runs short video platforms Moj and TakaTak, which boast of over 400 million users together. In the past year, ShareChat says it rapidly monetised platforms, leading to a revenue surge. Beyond advertising, the company also focuses on areas like virtual gifting and video commerce.

"Virtual gifting is witnessing incredible adoption on the ShareChat app, with the business line already at a $50 million ARR, which is set to more than double by year-end," says ShareChat.

Among new features, the ShareChat app added audio chatrooms, streaming 2 billion minutes of audio every month, the company claims.

Its short video platform Moj’s active users have jumped 3X since its launch in July 2020. The app saw 2X daily time spent per user compared to its nearest domestic rival, claims Sharechat while citing the App Annie data released in May 2022. New features added to the app are music library, an in-app chat and live streaming. Moj has also tied up with Flipkart to enter into social commerce.

The ShareChat parent acquired short video app MX TakaTak in February 2022 in a deal pegged at about $700 million, underlining its aggressive bets in the short video space. The combined Moj-MX TakaTak platform owned by ShareChat is estimated to have 100 million creators, over 300 million MAUs and nearly 250 billion monthly video views.

Video consumption in India has exploded over the last two to three years, helped by the proliferation of affordable smartphones and affordable data prices. According to market research firm RedSeer Consulting, short-form video contributes about 7% of overall time spent on content. Local short video platforms have been able to establish a strong base beyond the top 50 cities, suggest experts.