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Exclusive: Kavin Mittal’s Hike shuts down operations completely

EntrackrEntrackr · 2m ago
Exclusive: Kavin Mittal’s Hike shuts down operations completely
Medial

Exclusive: Kavin Mittal’s Hike shuts down operations completely After 13 years of operations, Hike is shutting down completely, including its US business, founder and chief executive officer (CEO) Kavin Mittal informed investors in an email on Saturday. Mittal said the decision follows the recent ban on real money gaming (RMG) in India, which shortened the company’s runway from seven months to just four months. “After much reflection and speaking with a few of you, I’ve decided to wind down Hike operations completely, including the US,” he wrote. Entrackr has reviewed the copy of the email. Soon after the RMG ban in India, Mittal had announced that the company would exit the country to focus on the United States and other global markets such as the United Kingdom, Canada, and Australia. However, the decision to shut down entirely has come as an unexpected move for the gaming industry. The company, which started as Hike Messenger and pivoted to Rush, scaled to 10 million users and generated $500 million in gross revenue in four years. Despite the growth, Mittal said the challenges of taxes, regulation battles, and the India ban made continuation unviable. “Is it worth it? For the first time in 13 years of building Hike, my answer is no,” he said, adding that the company may have been too early for its vision of building a gaming nation, while also pointing to better opportunities in AI and other frontier technologies. According to Mittal, Hike has around $4 million left on its balance sheet, which will be used to settle vendor costs and employee severance. Any leftover funds will be returned to investors. Mittal acknowledged the fatigue within the broader team after years of pivots and regulatory hurdles. “RMG was never the destination. It was a means to prove unit economics and unlock the bigger vision. But we got locked into the Indian market in a tax/regulation battle,” he said. Reflecting on the journey, Mittal noted milestones such as Hike Messenger reaching 40 million MAUs and becoming one of India’s most loved consumer brands. He described the shutdown as a disappointment but emphasized the learnings as “invaluable.” Looking ahead, Mittal said he plans to focus on new frontiers like AI, energy, and personal growth. “This chapter ends, but the climb continues,” he wrote, assuring investors that Hike will be closed responsibly.

India seeing China’s growth blitz of 2 decades ago: Mittal

LivemintLivemint · 2y ago
India seeing China’s growth blitz of 2 decades ago: Mittal
Medial

Sunil Mittal, Chairman of Bharti Airtel, praised India's "China-plus-one" strategy for attracting foreign direct investment (FDI) and attention to the country. He noted the positive growth in India's economy, highlighting progress in industrial, agricultural, and financial services sectors. Mittal expressed confidence in Africa's potential for economic integration and food security, suggesting that adopting Africa for agriculture could have a significant global impact. He also emphasized the need for increased telecom tariffs in India to ensure financial viability and support ongoing investments in digital infrastructure. Mittal commended India's approach to artificial intelligence (AI) and data protection, suggesting that the country's regulations could become world standards.

Edtech startup SpeakX announces $1 Mn ESOP buyback for 15 employees

EntrackrEntrackr · 10d ago
Edtech startup SpeakX announces $1 Mn ESOP buyback for 15 employees
Medial

Edtech startup SpeakX announces $1 Mn ESOP buyback for 15 employees Edtech company SpeakX (formerly Yellow Class) has launched its first ESOP buyback program worth $1 million, offering early liquidity to employees. According to the company, 15 out of its 20 employees will benefit from the buyback. The buyback comes on the heels of SpeakX’s recent $16 million pre-Series B round which includes performance-linked stock grants, tenure-based allocation, and a long-term ownership structure. Employees who complete two years at the company receive ESOPs with a 10-year exercise window, and grants extend across all departments instead of being limited to senior roles. Till date, SpeakX had raised a total of $23.3 million which includes $1.3 million in seed funding led by India Quotient and then a $6 million Series A round led by Elevation Capital in 2021. SpeakX said the initiative is designed to provide liquidity earlier than typical startup exits or late-stage rounds. The company added that its 20-member team collectively holds 6% equity, and the ESOP pool will expand as it raises new rounds. Founded by Arpit Mittal, SpeakX simulates real-world conversations and provides automated speech correction and multilingual support. The platform reports high engagement, with learners spending about 15 minutes per session. SpeakX initially began as a live learning platform but later pivoted in 2023 to an AI-powered learning app to make English learning more accessible and scalable. SpeakX’s app is currently available in India and select international markets, with plans to expand further across Asia and the Middle East. The firm also shared updated business metrics: CAC payback in one day, 3.7x LTV/CAC within six months, and 35% retention at Month 3.

Hike’s revenue soars 8X to Rs 150 Cr in FY23; losses up 24%

EntrackrEntrackr · 1y ago
Hike’s revenue soars 8X to Rs 150 Cr in FY23; losses up 24%
Medial

After years of stagnant growth and change in business, Hike posted a notable increase in its scale in the last fiscal year. Hike’s Rush Gaming Universe (RGU)—which hosts multiple skill-based casual games—grew nearly 8X and crossed the Rs 150 crore revenue mark in FY23. The firm’s losses, however, also stood close to Rs 150 crore in the same period. Hike’s revenue from operations skyrocketed 7.8X to Rs 150.5 crore during the fiscal year ending March 2023 as opposed to Rs 19.21 crore in FY22, according to its standalone financial statement with the RoC. Hike generates revenue from commission on entry fees, winning amount and membership fees for joining the application as a VIP member. Previously, Hike used to be a P2P messaging application but in January 2021 it shut down the product and switched to a different domain by introducing two new platforms Vibe and Rush. Vibe is a social media platform to watch videos together whereas Rush is a real money skill-based gaming platform which hosts multiple casual games. The company also earned Rs 1.4 crore via interest and gain on investments and other non-operating income during the year. Including these, its overall revenue reached nearly Rs 152 crore in FY23. As per startup data intelligence platform TheKredible, marketing expenses emerged as the largest cost element for Hike which grew 4X to Rs 142.65 crore in FY23 from Rs 35.86 crore in FY22. Its employee benefit expenses accounted for 35% of the total expenditure and went up 46.2% to Rs 104.42 crore in FY23. Importantly, this cost also includes employee share based payment (settled in equity) of Rs 26.71 crore. Due to the GST crackdown on real money gaming companies coupled with a challenging funding environment, Hike’s Rush Gaming Universe (RGU) had fired around 55 people or 22% of the total workforce. To check complete Expense Breakdown visit thekredible.com View full data Hike’s expenses on server, information technology consultancy, payment gateway and other overheads catalyzed its total expenditure by over 2X to Rs 299.3 crore in FY23 as compared to Rs 140.4 crore in FY22. Visit TheKredible for complete expense breakdown and YoY performance. Despite rising expenses, the company’s losses didn’t increase at that pace. Its losses increased 24% to Rs 147.3 crore during FY23 as compared to Rs 118.7 crore in FY22. Moreover, its outstanding losses mounted to Rs 1,923 crore in the last fiscal year. Hike’s cash outflows from operations, however, declined by 9.5% to Rs 94.5 crore during FY23. Its EBITDA margin improved to -93.92% during the year which can be ascribed to the rising scale. FY22-FY23 FY22 FY23 EBITDA Margin -525% -93.92% Expense/₹ of Op Revenue ₹7.31 ₹1.99 ROCE -61.20% -136.21% On a unit level, the firm spent Rs 1.99 to earn a rupee of operating revenue in FY23. Hike turned unicorn in 2016 when Temasek led a $175 million funding round at a $1.4 billion valuation. In January 2021, it shut down its chat services to enter the real money skill-based gaming space. Since then, it has raised three undisclosed funding rounds from various investors. Its last funding round came in May 2022 led by Web3 investor Jump Crypto to develop Rush Gaming Universe (RGU) — a web3 based social gaming metaverse. Hike’s efforts to find a perfect fit seem to have paid off as the company generated a healthy revenue — even though it took a long time to get there. The company’s losses, however, are still a point of concern. From the time it first raised money in 2013 to the present day, Hike has seen its earliest investor Bharti Airtel grow five times in revenue. Even Softbank, the other early backer, has written off its interest in the firm sometime back as inconsequential. While that takes some pressure off, there is no denying that its legacy weighs heavily on Hike, even when it seemingly is the closest to discovering a viable business model. Will it be able to sustain this new momentum long enough to finally deliver a worthwhile return to any of its investors? Time will tell.

Telcos hiring down to 30% in FY25, job additions will be seen in 5G roles, and for expansion plans, says report

LivemintLivemint · 1y ago
Telcos hiring down to 30% in FY25, job additions will be seen in 5G roles, and for expansion plans, says report
Medial

The growth of the workforce in India's telecom sector is expected to slow down to 30% in FY25, compared to 31% in FY24 and 51% in FY23, according to data from TeamLease and Quess Corp. This is due to the lower capital expenditure of major telecom companies like Reliance Jio and Bharti Airtel, who have completed their 5G expansion plans. However, other players like BSNL and Vodafone Idea are expected to add jobs for their expansion plans and 5G roll-out. Overall, the telecom industry remains one of the top five employers in India, with positions in various segments actively recruited. Additionally, apprenticeships in telecom companies have increased in the last two years.

Funding and acquisitions in Indian startups this week [25-30 Mar]

EntrackrEntrackr · 1y ago
Funding and acquisitions in Indian startups this week [25-30 Mar]
Medial

This week, as many as 17 Indian startups raised $125.13 million in funding. These deals include seven growth-stage deals and nine early-stage deals. These deals also include one early-stage startup which did not disclose the amount raised. Last week, about 23 early and growth-stage startups collectively raised around $447 million, including two undisclosed deals. [Growth-stage deals] Among the growth-stage deals, seven startups raised $103.43 million in funding this week. Vernacular social media platform ShareChat led the list with $49 million debt funding. The list was followed by three fintech firms namely Aye Finance, Sindhuja Microcredit, and KreditBee which raised $16.5 million, $14.5 million, and $9.4 million funding, respectively. Further, adtech startup AdOnMo, IPO-bound MobiKwik, and cybersecurity startup TAC Security also secured funds this week. [Early-stage deals] Subsequently, nine early-stage startups scooped funding worth $22.71 million during the week. Sustainable packaging startup Bambrew spearheaded the list followed by branded franchised retail chain SuperK, AI security and risk management startup SydeLabs, crypto exchange Nomoex Global, and proptech firm Aeria. The list further includes logistics solutions provider JustDeliveries, agritech startup Elevate Foods, AI-powered deep tech startup Daakia, and B2B footwear marketplace Kaarigar Mandi. The list of early-stage startups also includes edtech startup Aviotron Aerospace which kept the funding amount undisclosed. For more information, visit TheKredible. [City and segment-wise deals] In terms of the city-wise number of funding deals, Bengaluru-based startups led with 5 deals followed by Delhi-NCR, Mumbai, Hyderabad, Patna, Kolkata, and Agra. The complete breakdown of the city and segment can be found at TheKredible. [Series-wise deals] During the week, Seed funding deals are on the top spot with four deals while debt deals are in second position forming around 57% of the total funding. Further, Pre-Series A and Series A are next on the list among others. [Week-on-week funding trend] On a weekly basis, startup funding slipped 71% to $125.13 million as compared to $447.6 million raised during the previous week. The average funding in the last eight weeks stands at around $259 million with 27 deals per week. [Departure] This week, Praveen Sharma, senior vice president of business at Paytm’s parent entity One 97 Communications, resigned nearly after over four years, the company said in an exchange filing. Sharma, in his resignation letter, said he intends to pursue “other opportunities” after his exit from the company. [Fund launches] The week saw only one startup-focused fund launch. Mumbai-headquartered venture debt firm Alteria Capital has announced the final close of its third fund at approximately $186 million. The firm has backed startups such as Rebel Foods, BlueStone, OneCard, Ather, and Captain Fresh, and plans to continue its support for startups across various sectors including consumer brands, e-commerce, fintech, logistics, business-to-business platforms, rural and agritech, healthcare, and climate tech. [Shutdown] Investment tech startup GoldPe will cease to exist precisely one year after its inception on April 1, 2023. Co-founder Parth Shah stated that the decision was made due to the absence of a sustainable revenue stream, a flawed business model, and cash flow issues. Visit TheKredible to see series-wise deals along with amount breakup, complete details of fund launches, and more insights. [New launches] ▪️ Mamaearth parent Honasa launches Staze to foray into cosmetics space ▪️ Cars24 rolled out Autopilot service to get car drivers on demand ▪️ CarDekho Group’s fintech arm Rupyy forays into personal lending space [Financial results this week] ▪️ Bounce’s revenue surges 6X to Rs 91 Cr in FY23; cuts losses ▪️ BillDesk records Rs 2,678 Cr revenue in FY23; profits fall 5% ▪️ Man Matters-parent Mosaic Wellness crosses Rs 200 Cr revenue in FY23 ▪️ Myntra claims positive EBITDA in the last two quarters ▪️ IPO Prep: Swiggy paints a healthy financial picture in first 9 months of FY24 [News flash this week] ▪️ Ranjan Pai’s MEMG and 360 One get CCI nod to invest in API Holdings ▪️ ICICI Securities reiterated the ‘BUY’ rating on Zomato ▪️ Innoviti gets payment aggregator licence from the RBI ▪️ Chiratae Ventures sells stakes of portfolio startup to Madison India Capital [Conclusion] The weekly funding saw a significant drop in investment flow as compared to the last week when the funding crossed $440 million. This week only one VC firm Alteria Capital launched a startup-focused fund amounting to around $186 million. Additionally, the week also witnessed a shutdown as investment tech startup GoldPe shut down the shop within one year of its inception. CCI has approved the subscription to CCPS B of API Holding by Ranjan Pai’s MEMG (Manipal Education and Medical Group) and 360 One. This decision follows CCI’s previous approval, where multiple combination proposals entailed investments by marquee investors such as Goldman Sachs, Naspers, Temasek, and CDPQ in API Holdings Ltd., the parent company of PharmEasy. Brokerage ICICI Securities has reiterated a ‘BUY’ rating on foodtech giant Zomato and raised its price target (PT) to Rs 300 per share. This represents an upside of more than 67% from the stock’s last close of around Rs 182 on Thursday (March 28). The brokerage attributed the increase in PT to the company’s “sustained growth trajectory and sustained improvement in profitability metrics”. Digital payments solutions company Innoviti has secured an online payment aggregator (PA) license from the Reserve Bank of India (RBI). Along with Innoviti, Navi Mumbai-based payment solutions provider Concerto Software and Systems also secured the PA license for its gateway ‘Vegaah’. This takes the tally of the number of entities to receive PA licenses in 2024 to 13. Earlier this month, Infibeam Avenues also secured final authorization from the central bank to operate as a payment aggregator via its payment gateway brand CCAvenue. Last month, Amazon Pay also received PA authorization. JusPay, Stripe, Tata Payments, and Mswipe are among the other players to receive the PA license this year.

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