Bengaluru: Dailyhunt is one of the few start-ups in the digital content space that has caught attention among both investors and users. Dailyhunt’s roots can be traced back to the telecom market before the advent of mobile apps, when it used to be a VAS player. As the Internet started growing among Indian consumers, digital transformation was inevitable and Dailyhunt made a successful pivot from a traditional content distributor to a mobile news aggregator with over 50 million users. It also raised more than $60 million from multiple investors, including Internet-focused venture capitalists (VCs) like Sequoia (Capital India) and Matrix Partners India. Mint caught up with Virendra Gupta, co-founder and chief executive officer (CEO) of Dailyhunt to tell its growth story .
Why is Dailyhunt only news-focused?
So, what interests me is the mass market at the core level. What interests me is creating impact in the mass market, and that’s what I have done all my life. I started working with the mass market from 1995 to 1997, when I was with telecom operators and other telecom companies. And when we were choosing to build things at that time, we chose to build things like prepaid top-up, e-recharge in Airtel. I feel that on the content space, especially in the local language content space in India, we have just touched the tip of the iceberg. There is a lot of scope and a lot of growth opportunities and a lot of ideas to implement.
Once we acquired Newshunt in 2012, we were looking to serve the mass market. And when it hit the market, there were a lot of things that we observed. So at that time, from our perspective, India had a 10% English literacy rate. Seventy-percent literacy was on the local language side. All the people who are going online are local language users.
You can serve the mass market in India only if you are able to appeal to all languages, and all sets of users—old users, middle-aged users, young users... So, when we started looking at the market this way we found that in some cases, news is the best-suited content category for growing a user base. So, that’s why we decided that news is our destination.
What’s next for Dailyhunt in the next five years?
There are multiple trends happening in content. When we look at these trends, we ask ourselves, which areas do we get into, and which areas we shouldn’t. There are a lot of areas which can get you a lot of traffic. But they are not what you want to be as a brand, and some areas are non-monetizable as well. So, when I look at the content landscape, I think we want to serve multiple segments of this market. We want to appeal to the entertainment segment, lifestyle segment, women’s segment as well as the tech news and content segment. Looking at content tailored for the women audience, the next set of people who are going to come online are going to be women, and that’s a highly monetizable segment.
So, next is more hyperlocal content. If you look at any newspaper, what gets printed is just 10% of what gets generated online because the newspaper has only a limited size. When you start becoming more local, there is a lot of hyperlocal content to tap. A lot of great videos, informative videos, spiritual videos, entertainment videos. We won’t indulge in soft-porn content, we don’t want to be in that segment at all. We will mostly look at something like lifestyle videos and self-help videos. Then there are things like cricket, it does very well. We have cricket sections, and scoreboards and all that. We create special properties on our app during elections.
So when the election was happening, according to Akamai (Technologies), we were the second most used site, in spite of us not having videos. So, we can carve out specific content around specific events. There is a lot of horizontal play…there is a lot of customized play involved.
How does Dailyhunt manage to maintain its office culture, which is a mix of both a newsroom and a corporate office?
We are a good mix of online and offline. The way we are working is very different. The tech way of working is very different. The journalistic way of content is very different. And I think what makes this company more exciting is a good amalgamation of all this. There is a huge amount of learning, and everyone learns from each other, which also motivates them to perform better. I think the value which humans create using content is huge, and you cannot demystify that. At a scale, what the machine does, the humans can’t do. Our ad sales team, they go to the street and fight for every ad dollar. So, I think what makes this company is a good harmonious culture with a lot of diversity coming in from different teams.
How do you keep the company afloat only on advertising revenue, since you don’t charge users?
There has to be some business model, either customers have to pay or advertisers have to pay. Without that, nothing can happen, we can’t keep our eyes closed to that. That’s not what we are. To build a sustainable advertising business, you need to have a sufficiently large user base. If you don’t have a sufficiently large base, and a sufficiently engaged base, and a destination to which a brand can associate itself with, you won’t make money online. Ad networks won’t give you the big money. I think India’s story of advertising is a very strong mass market, based on what brands advertise on TV and newspaper. We have built an organization which goes and sells ad spaces to these big brands, with different ad formats for each brand category. So before doing this, you need to have critical distributional reach and engagement, to engage any meaningful ad dollars. Secondly, you need to be a brand, with whom people want to associate with. You also have to build organization to leverage all this and we have successfully built one.
How can IT policies, industry policies be used to shape growth of Indic language content in India?
See, I’m a firm believer of free market. And I think what the department of telecom (DoT) is doing by mandating 22 Indian languages on mobile phones is very nice, because it ensures that digital inclusion happens faster than what it would normally take. I think coupled with that, a lot of things like land records, lot of things like that should happen in local languages. Even transaction systems for the mass market, online job vacancy portals, government schemes for poor, health schemes information, or any other government and municipal level information should be made available in Indic languages, both offline and online.
What are the investors thinking about investing in media start-ups?
I think, what struck a chord with the investors was that, we were addressing large sets of users, which is actually a part of the online Internet base. So, whenever any investor evaluates your business, they look at the potential total addressable market. Our product easily took off with our target user base, and there was a good amount of user retention. So, these were the things that struck with the investors. We were addressing the vernacular market, so everybody who was betting on the Indian growth story was looking at the potential of the Indic language market. Because if you can’t address this market, then there is no growth story. So to me, that was the core value proposition, and the content was the way to reach out to the users, and to acquire and to create stickiness among users.
What or who inspired you to take up entrepreneurship?
What fundamentally inspires me is innovation, and the thrill of always breaking things and creating something new. Fundamentally, that’s how I’m wired. And that’s what drives me. If you just go back 15-20 years in history, the start-ups of that time were telecom companies, and the penetration of mobile phones was very low.
So, I was a part of that industry that was constantly growing. Innovation, fast-beat things, mass market, they drove me at that time. And that’s why creating a great product and doing it to scale remained an objective.
Is there any one person/company who inspires you?
There are many, there a lot of favourites, it’s difficult to pinpoint one company or a person. So the way I look at it, frankly, I feel very blessed to be in India and to be in this ecosystem where we have got a chance to build something to be able to execute your own ideas, and to create an impact on the mass market. To me, that’s how I see entrepreneurship.
People across the globe have made huge companies, and you know all the names, and those are also the people I also admire. People back home, who started from scratch to large companies. We admire all those companies; to me there is a learning everywhere. There is a learning from somebody’s success to learning from somebody’s failure.
Are start-ups solving problems anymore? What advice would you give to new entrepreneurs out there?
There are certain things that I like about the ecosystem, and certain things that I don’t like among current start-ups. What I like is their fearlessness, I think that’s great. When I was particularly at a younger age, I don’t think I was that fearless, as they are. I think being true to yourself, when you are solving a problem, I think that’s very important. Because, eventually from an entrepreneur, that’s what matters. If I explain you a problem, you may not understand it the right away. But if I understand that problem, and if I’m being true to myself then you take the right decisions, and solution, and then that’s achievement. So, never have a misconception about what you are solving.