Homegrown social media platform ShareChat was co-founded by IIT-Kanpur alumni — Ankush Sachdeva, Farid Ahsan and Bhanu Pratap Singh — in 2015. Today, the Bengaluru-based company claims over 180-million monthly active users (MAUs), and counts Twitter and Snap among its investors. Last year, when India banned Chinese short-video app TikTok, ShareChat stepped in and launched its own short-video platform Moj, which currently commands over 160-million MAUs. The company, which raised $502 million in April at a valuation of $2.1 billion, wants to be known primarily as an algorithmbased social media platform.
Ankush Sachdeva: The story of our journey goes back to 2012, when I met the other-co-founders. We were all students at IIT-Kanpur and met at an event called Yahoo Hackube. The company used to organise these various hackathons in college and we were in different teams. All three of us won in our respective categories and met during dinner. That’s how we started off.
While in college, we kept building products, but nothing worked. That was when we stumbled upon the idea of ShareChat. While working on products, I would visit various Facebook groups and put out links. In all these groups, people would just randomly leave their personal numbers. I took a 1,000 phone numbers, made 10 different WhatsApp groups, named them ‘Sachin Tendulkar photos’ etc., and went for lunch. One hour later, there were hundreds of unread messages on my phone. People were sharing content randomly. That’s when we realised that a large audience, non-English speaking, is consuming content and wants to create content as well. In December 2014, we officially launched our first product — public chat rooms based on individual interests such as fan clubs, exam preparation channels etc. Our first pivot was to build a chatbot kind of system. For example, if you were looking for Katrina Kaif’s pics, you would go to these chatbots, say that you want so and so images, or you could also go into these bots and ask for phone recommendations based on the kind of specifications you were looking for and the budget you have. Here we had two very important observations. First, everybody wanted content, no one cared about sophisticated conversations. Second, more than 50% chose English as their preferred language, but the engagement levels were very low. People chose English because of a) aspiration, and b) their trust level with a vernacular language app was very low. This led to our second pivot — a simple content feed with a single-share tap to WhatsApp sans English. We saw a massive gain in our metrics.
When we got this product-market fit, essentially people were using it to share viral content. At that time, a small team within our company was focussing on algorithmic improvements. This team consistently gave us gains — over time spent, retention, etc. We decided to focus on the algorithmic feed, but it raised a lot of eyebrows — from people, investors, everyone. Now, it is different. I am glad we stuck to it.
Make Or Break Moment
All three of us did not sit for placements, and we were living in Mumbai with very little cash. We used to live with Prateek Shukla [who co-founded no-brokerage rentals platform Grabhouse]. He was our senior and mentor. We used to sleep in his office in Goregaon every night, go to India Quotient’s office in the morning. India Quotient later became our seed investor.
Till then we were building an app called Opinion. When we got our initial funding— ₹50 lakh—we pivoted to the new concept called ShareChat. Still, it wasn’t working. We had ₹10 lakh in our bank account and two months of runway. We were trying two things —to perfect the PMF, and raise funding. Luckily, both happened at the same time.
The Business Model
We had to figure out a sustainable way to grow our daily active users (DAUs). In our business model, revenues come late. But if you show a consistent growth rate, you will get revenues. That is how all social networks function. So we had to figure out the sustainable levers that would work across years, multiple quarters, and keep giving us gains. Basically, the ways of content supply. We realised if you have a diverse set of content supply on your network and a powerful algorithm that can match it with the consumer, you will have a much-better retention and the time spent will be more. Our business model was simple: Get people to spend more time, and get as many DAUs as possible. Now there is a third component to it — revenue. There are content creators, content consumers, and advertisers. But for the first four years, it was a two-way marketplace — content creators and consumers.
In 2015, pre-Jio, the biggest tech challenge was the delivery part. How do you get them content on a patchy 2G network? So we built an entire stack with WhatsApp as the base, because it was the only thing that worked on their phones. The entire infrastructure was built like a chat, so if we get like a one second window when the network is steady, we will push the content. This was the initial tech breakthrough that made us scale. Post-Jio, delivery was no longer a problem. The problem then was on the ranking side. You have a lot of content, people can consume it, but how do you make it the most personalised, relevant experience for the consumer? We have been on that journey, building that AI infrastructure to sort of build that capability.
Our focus has been on talent acquisition. There are no experienced people in India who have done this before. We needed to find people who were first-principled in adjacent domains, like say in e-commerce. A lot of our initial hiring was around that. After the pandemic, when we went remote, we launched Moj. We had to build our AI team, and that, too, very very quickly.
We have always had very interesting conversations with investors. Like if you show the app and say it deals with Hindi jokes or memes, the initial reaction is ‘why should we fund this?’ People called it chillar content, or garib content. My point was if India’s massive youth demographic is consuming it, and, if you see the data, you will realise a large part of the content consumed is poetry around break-ups. Why should we want to put our own sense in what the content should be and not give what people want? But our growth superseded everything.
Sales & Marketing Lessons
Our business is not so dependent on marketing and sales. When we talk about sales, it is largely advertisement sales. It is a very 12-month-old phenomena where we are trying to pitch to advertisers why they should, if they are launching say a new lipstick or something, target housewives in Tamil Nadu on our platform. On the marketing side, our focus has been on CAC (customer acquisition cost). We should have a low CAC, and we should make enough revenue to cover that.
When Did You Think You Had Arrived?
That happened when we removed English, made the user experience simple, and pushed that update in the night. When we opened the real-time dashboard, within 10 seconds there were 10 more events — if a user opens the app and shares the content, it is an event. Normally, after five minutes you’d get three events, but 10 events in 10 seconds was insane. We thought it was a glitch. But even after refreshing the same thing happened. That was when we realised we had hit the product-market fit).
ShareChat is at 180-million MAUs, while Moj is at 160 million. Our aim is to hit 1-billion MAUs by 2025. Our vision is to enable millions of people in India to express themselves creatively. Our algorithm will find the audience for them. We also want to hit $1-billion revenue by 2025. The focus will be on AI.