Goldman Sachs Investment Partners, the venture capital arm of the New York-based investment bank, is set to lead regional language news aggregator Dailyhunt’s latest $60 million round, said three people aware of the matter, requesting anonymity.
Dailyhunt, run by Verse Innovation Pvt. Ltd, aggregates news from a variety of newspapers and websites, and caters to 13 regional languages, including Marathi, Gujarati, Tamil and Bhojpuri.
It also offers original video content in Hindi and Telugu and a free live television streaming service in nine languages through strategic partnerships. The company’s latest product, Newzly, is a news excerpts mobile application that provides customised trending headlines in nine languages.
The news aggregating startup’s latest fundraise comes at a time when Helo, owned by China’s ByteDance, backed by SoftBank and reportedly valued at $75 billion, according to an October report by Bloomberg, is on a spending spree in India, as it looks to tap the country’s internet consumer market. Helo aggregates content in over a dozen Indian languages.
ByteDance, one of Dailyhunt’s investors, had led a $25 million round in 2016. “Investing in Dailyhunt, as well as competing with it, is an attempt by ByteDance to hedge its bets and expand in India’s relatively under-penetrated and huge regional language content market," said one of the people cited above.
Last year, Mint reported Dailyhunt was seeking to raise capital at a valuation of almost $500 million and held talks with China’s Alibaba group.
Dailyhunt, founded by Indian Institute of Technology (IIT) alumnus Virendra Gupta, raised ₹24.61 crore last month in an internal round from Sequoia Capital and Omidyar Network, showed documents sourced from intelligence platform Paper.vc.
Goldman Sachs, ByteDance, Sequoia and Omidyar declined to comment, while Dailyhunt did not respond to emails. Dailyhunt’s other investors, including Falcon Edge and Matrix Partners, did not respond to Mint’s queries.
In recent months, Indian content startups have faced stiff competition from well- funded Chinese companies, which have been spending huge amounts of marketing dollars to gain market share.
On 28 January, Mint reported that Sharechat, a local language content sharing app has seen its daily active users (DAU) plateau in the last three months of 2018 at 5 million as of end-December. This was primarily due to rising competition from Chinese apps, according to numbers tracked by mobile analytics firm AppAnnie.
ByteDance, which owns Helo and short-video platform TikTok, is spending $15-20 million a month to market the two platforms, which entered India last year, Mint reported.
Dailyhunt also competes with Alibaba-backed UC News and NewsDog, which raised $50 million last November.According to venture capital investors, content startups need to raise large rounds of funding not just to fuel their own growth and revenue plans, but also to build a war chest against competition.
“I don’t think any of the newer content startups have revenue as an objective. The key north star metric for them is DAUs. They are focussed on driving this number up," said Sajith Pai, part of the investment team at Blume Ventures, an early-stage investor.
“However, for some of the older startups, such as Dailyhunt and even InShorts, which have Series B funding (4-5 yrs old), their investors would have started asking questions around revenue."