India’s ShareChat has begun discussions with investors, including Snap and Google, to raise over $200 million after its sale talks with Twitter fizzled out recently. Twitter was looking to build a global rival to short video-app TikTok and held talks with ShareChat for a possible acquisition, TechCrunch reported citing sources on Monday.
Notably, ShareChat recently entered into a first of its kind partnership with Snap to integrate the latter’s Camera Kit into its short video app.
The US-based microblogging major, which is already an investor in ShareChat, has struggled to grow its user base in India outside of bigger cities and towns in India.
Twitter had about 75 million users in India in January, according to mobile insight firm AppAnnie. It was recently involved in a tussle with the Indian government over the former’s move to restore about 250 accounts in the country.
According to the report, Twitter offered to buy the Bengaluru-based ShareChat for $1.1 billion and was committed to investing an additional $900 million after the acquisition to help the startup grow in the market.
Interestingly, US-based technology major Google is also looking to acquire ShareChat in India. ShareChat was previously in talks with Microsoft Corp. for an investment of around $100 million.
ShareChat had been looking to raise funds to better compete with various short-video format applications in India. It raised $40 million from a slew of investors in September, including Twitter, SAIF Partners, Lightspeed Ventures and India Quotient at a valuation of $650 million. However, the requirement was around $150-200 million.
Twitter had previously led ShareChat’s Series D funding round with additional backing by SAIF Partners, Lightspeed Ventures and India Quotient. ShareChat has so far raised $264 million.
StareChat last year launched Moj video-sharing service just a day after the TikTok ban. The new service garnered about 80 million users since its launch in July 2020.
The report added that Twitter expressed intention to take Moj to international markets and position it as a rival to the Chinese app TikTok.
Several players are trying to fill the void after the Indian government banned TikTok earlier this year. The ban attracted a slew of local players and forced social networking giant Facebook to launch its offering, Instagram Reels, in India. Google also launched YouTube Shorts in India but hasn’t seen any success to date.
With over 160 million users, ShareChat is known for targeting non-English speaking audiences in India and offers over 15 Indian languages. It attracted 100 million users after India banned TikTok earlier this year.
The startup had previously set up an R&D lab in Silicon Valley and brought on board former Uber product leader Gaurav Mishra. The lab is working on artificial intelligence and machine learning-driven capabilities for its social media platform.