ShareChat Seeks $50 Million Investment, Valuation May Decline by 55%
- ByStartupStory | October 6, 2023
ShareChat, the Google-backed short-video platform, is actively seeking fresh investments totaling approximately $50 million. The social media company aims to secure this funding, which could potentially value the firm at $2.2 billion, marking a significant 55% drop from its valuation the previous year.
Sources suggest that ShareChat is exploring a bridge round of primary capital, with existing investors expected to contribute to this funding round through compulsorily convertible preference shares (CCPS). Additionally, early investors are contemplating selling secondary stakes, a move that could further reduce the company’s valuation.
Despite counting Google, Temasek, and the Times Group among its investors and witnessing a 4.3-fold increase in total revenue to INR 419.2 crores in FY22, driven primarily by operating revenue, ShareChat reported increased losses, totaling INR 2,988.6 crores in the same fiscal year.
The startup has faced operational challenges in recent times, leading to layoffs and the discontinuation of various business verticals as it prioritizes profitability. This includes the closure of its gaming division, Jeet11, and a scaling down of social commerce, live commerce, and fact-checking efforts.
During this period, two of ShareChat’s co-founders, CTO Bhanu Pratap Singh and COO Farid Ahsan, stepped away from active roles.
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Founded in 2015, ShareChat initially entered the short video format market after the ban of TikTok in 2020. It now claims to have over 325 million monthly active users across its platforms.
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