Sequoia Capital India, others invest Rs 100 crore in Verse Innovation
The investment comes at a time when increasing proliferation of budget smartphones is boosting demand for regional language content.
The financing, which sources indicate may have valued the seven-year-old startup at nearly $150 million or Rs 900 crore, also saw participation from its existing investors Matrix Partners India and Omidyar Network.
The investment comes at a time when increasing proliferation of budget smartphones is boosting demand for regional language content, an opportunity both startups and venture capital investors are betting big on.
“The era of the real Indian mobile Internet written and consumed in local language is just beginning,” said Verse Innovation founder and Chief Executive Virendra Gupta. “Our vision is to create a made-for-India platform and work closely with publishers, developers, OEMs and other ecosystem partners to digitise, distribute and monetise the consumption of local language.”
Gupta or Verse's investors declined to comment on valuation.
The Bangalore-based startup's NewsHunt application has already been a hit with more than 50 million installs, 14 million monthly active users and over 1.5 billion monthly page views. It plans to expand the active user base to 100-200 million a month in the coming years.
NewsHunt aggregates content in over a dozen languages, including Hindi, Bengali and Tamil, from more than 100 newspapers, magazines and other publications. It plans to increase the number of publishers on the platform to 1,000 soon.
NewsHunt also offers eBooks, and has already seen more than four million downloads in the past six months. The popular titles includeChanakyaniti (Hindi), Aadujeevitham (Malayalam), Ponniyin Selvan (Tamil) and Shrimad Bhagavad Gita (Marathi).
The company makes revenue selling books and through advertisements on the platform, besides offering a gateway to vernacular users for other popular mobile applications. NewsHunt's user base has attracted e-commerce firms like MakeMyTrip, Flipkart, Snapdeal and BookMyShow, who advertise on the platform.
“As India moves from a 100 million to 500 million smartphone user base, it is critical to bridge the gap of making available relevant content and apps for Indian language users,” said Mohit Bhatnagar, managing director of Sequoia, who says Verse Innovation is best placed to become a leading digital goods company.
By 2017, 385 million people will have smartphones, six times more than today with data consumption rising threefold and consumers buying five times more content, according to a recent report by AT Kearney and Google. The same report also stated that 93% of the time spent on video content consumption was in vernacular languages, indicating the demand for local language content.
There are other startups like Reverie, which develops Indic language keypads for handset makers like Micromax, which are also tapping this opportunity.
Reverie founder Arvind Pani says English literacy in India is less than 10%, but overall literacy is about 75%. “If you extrapolate this data to mobile user base in India of 850-900 million, we are talking about at least 600 million people in the country who are literate but not in English. This is the user base in India which needs to be tapped,” he said.
Verse Innovation was founded in 2007 by Gupta, now 41, who hails from Jodhpur and did his masters in management from IIT Bombay's Shailesh J. Mehta School of Management. Gupta has worked in the mobile value-added-services industry for nearly two decades, at companies like Bharti Cellular and OnMobile. Verse initially focused on mobile classified services like job alerts, and then acquired NewsHunt in 2012.
“The emergence of NewsHunt has been exciting to witness as an early and largest investor in the company,” said Rishi Navani, managing director of Matrix Partners, who first invested Rs 20 crore in the venture in 2009.
Verse Innovation has also come up with a proprietary payment platform iPayy, which is also being used by third-party developers for micro-transactions.