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ShareChat raises $16 Mn additional debt; lays off 5% employees

EntrackrEntrackr · 11m ago
ShareChat raises $16 Mn additional debt; lays off 5% employees
Medial

Mohalla Tech, the parent entity of the vernacular social media platform ShareChat and short video entertainment app Moj, has expanded its debt round to $65 million with $16 million latest infusion from Singapore-based EDBI. In April, ShareChat had raised around $49 million in debt from existing investors including Temasek, Lightspeed, HarbourVest, Moore Strategic, Rimco and Alkeon. The company also saw its valuation nosedived to less than $2 billion from $5 billion during its last fundraise in June 2022. The additional funds will be utilized for advertising company’s tech stack and expand the consumer transactions businesses with investment in newer monetization features, ShareChat said in a press release. A Moneycontrol report also said that ShareChat has let go of 5% of its workforce as a part of its mid-year performance cycle. In 2023, the firm put several cost-cutting measures and sacked 700 employees across two phases. “…some employees are impacted on the basis of performance. This accounts for less than 5% of our workforce. We have a number of open positions and we continue looking for high quality talent across functions,” said a company spokesperson. According to startup data intelligence platform TheKredible, ShareChat has raised around $1.8 billion from investors including Twitter (now X), Alkeon Capital, Moore Strategic Ventures, and Tencent, among others. ShareChat claims that the app is operationally profitable for the past several months, while the Moj app is close to operating break-even. Both apps cater to over 325 million users. While the Ankush Sachdeva-led firm is yet to file its FY24 financials, it spent nearly Rs 4,000 crore in FY23 to earn Rs 533 crore in revenue. Overall, it recorded Rs 3,241 crore loss in FY23. The surge in losses was primarily due to the write-off undertaken by the company for the acquisition of Moj’s competitor MxTakaTak. ShareChat spent nearly $700 million via cash and stock to acquire the Times Internet-backed company.

Streaming was supposed to rescue the ailing TV ad business. It hasn’t.

LivemintLivemint · 1y ago
Streaming was supposed to rescue the ailing TV ad business. It hasn’t.
Medial

Brands such as Mondelez and Hershey are decreasing their TV advertising budgets as they find that traditional television no longer reaches their target audiences effectively. These companies are redirecting their ad spending to social media sites like TikTok and Instagram, as well as advertising on the websites of large retailers like Amazon and Walmart. While many had hoped that ad-supported streaming TV would fill the gap left by traditional TV, this has not been the case. Brands are now focusing on building reach across multiple platforms and shifting their ad budgets to digital channels. Live sports remain popular for TV advertising, with 96 of the 100 most-watched broadcasts last year being live sports events. However, as more sports content is watched on streaming platforms, traditional TV conglomerates are preparing to launch dedicated sports streaming platforms. The streaming landscape remains fragmented, and streaming audiences are less tolerant of ads compared to traditional television. High ad prices and varying viewership measurement and ad performance also complicate matters for marketers. Retail media, including platforms like Amazon and Walmart, are benefiting from the shift away from traditional TV, as they offer access to valuable customer data and the ability to measure ad effectiveness. Ad spending in the retail media sector is expected to surpass traditional TV ad spending next year. Microsoft has reduced its traditional TV advertising in favor of digital ads, which offer better measurement. The decline in TV ad spending is happening faster due to significant discounts offered to longstanding advertisers, but if these discounts were removed, brands like Mondelez would likely stop buying TV commercials altogether.

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