CPPIB leads $805m round for India's VerSe

CPPIB contributed USD 425m. It was joined by a group including Ontario Teachers’ Pension Plan Board, Luxor Capital, Sumeru Ventures, Sofina, and Baillie Gifford. A USD 450m Series I was provided in August last year by Sofina, Baillie Gifford, and The Carlyle Group, among others.

The Series I valued VerSe at about USD 3bn, while a USD 200m Series H backed by Sofina six months prior valued the company at USD 1bn. The investor roster also includes the likes of Google, Microsoft, Falcon Edge Capital, Sequoia Capital, Matrix Partners, and Goldman Sachs.

Founded in 2007, VerSe is one of the fastest-growing local language artificial intelligence-driven (AI) content platforms in India. Dailyhunt, its news app, has around 350m users, while Josh, its short-video app has about 150m users. They offer services in 15 and 14 Indian languages, respectively.

Dailyhunt – originally known as Newshunt – was set up in 2009 by several former Nokia executives, who sold to VerSe three years later. In addition to news, it offers e-books, magazines, comics, and videos. The company describes its deep learning technology, which enables personalised content, as a key advantage.

News apps are an established investment niche in India, with previous activity including a USD 50m round for NewsDog, and a USD 35m round for InShorts, previously known as NewsInShorts. The difficulty with this category is thin margins, with about 70% of revenue said to end up going to the news owners and news creators rather than the aggregator.

VerSe has seen this effect mitigated with the popularisation of Josh, which received a boost in 2020 when political tensions with China resulted in the banning of short-video leader TikTok, which had some 200m users in India. As of the Series I, Josh had amassed more than 115m monthly active users.

VerSe also runs PublicVibe, a news and video platform formerly known as NewsDistil, that has a vernacular language creator base of more than 50m and claims to generate hyperlocal content at “apartment and street level.” It receives around 80bn video plays per month.

The fresh capital will be used to strengthen AI capabilities and broaden the app offering to include e-commerce and live-streaming. This effort will involve a continued focus on underserved vernacular language audiences and new internet users.

“With a strategic focus on video content and building for India, we have seen explosive growth emerging from the next billion users coming out of regional India,” Umang Bedi, co-founder of VerSe, said in a statement.

“This investment comes at a time when we’re on a path to further expand our offerings, monetisation models, deliver superlative Web 3.0 experiences for the globe and create an IPO-scale business.”

VerSe is one of the flagbearers of India’s burgeoning digital consumer media landscape, where EY predicts revenue will grow from INR 291bn (USD 3.8bn) in 2021 to INR 425bn by 2025 – excluding online gaming.

Other standouts in this space include social media and short-video player ShareChat, which has raised almost USD 1bn since the TikTok ban. The company was valued at USD 3bn as of a USD 145m Series F last year.

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• Topics
• South Asia
• Media
• Consumer
• Expansion
• India
• CPPIB
• OTPP
• Sofina
• TMT