ShareChat’s formidable growth story: Can it become by default social network for Bharat?
Building products and features for Bharat have become a top priority for Indian startups as the next half a billion Internet users would come from non-English speaking regions (tier II, III, IV cities and rural areas).
While commerce based product companies are still slow in devising strategies for such audience, content-focused tech companies have been competing fiercely to attract users and retain them.
About a dozen companies including Chinese heavyweights – Bytedance (owner of TikTok and Helo) are trying to woo first-time internet users through content in languages they prefer. While the trend of catering to the non-English speaking audience has caught on since last year, ShareChat has been doing it for over three years.
Based on its growth and kind of investment it has secured, ShareChat is one of the most formidable products in the vernacular content space.
Currently, the Shunwei-backed firm claims 10 million daily active users (DAUs) who post a million pieces of content every day.
For context, last November it had only a million DAUs. So, which factors led ShareChat to register 10X jump in user base in just 10 months?
“Penetration of smartphone and cheap data packs have brought the Internet to millions of new users for the first time. However, there wasn’t much content for them to consume and engage in,” says Ankush Sachdeva, Co-Founder and CEO ShareChat.
According to him, unavailability of content in vernacular languages has been leading ShareChat’s growth.
ShareChat growth drivers
But, who are these users sharing good morning messages, shayari, and pictures? “It could be anyone. People in smaller cities enjoy creating and sharing content as it gives them a sense of being creative,” adds Sachdeva. Citing examples, he mentioned that a group of carpenters in Jodhpur shares design of their tables just to showcase talent.
South India contributes maximum traction for ShareChat. “Network effect in Southern states is very strong for us. Tamil Nadu, Andhra Pradesh, Karnataka, and Kerala give us about half of our overall DAUs,” points out Sachdeva. Genres like romance, poetry, and utility like news and study materials are the most viewed categories on ShareChat.
While experts anticipate that ShareChat may get into content generation after closing $100 million Series C round, Sachdeva rules out any such plan. “We fundamentally believe that there is a lot to be done in user-generated content space. UGC is largely untapped and we are solely focusing on it,” explains Sachdeva.
Since vernacular content space has become crowded, ShareChat faces competition from Helo (a Bytedance company). “Great opportunities will always have great competitors. We aren’t bothered by them. Our mantra is to beat the competition through growth,” says Sachdeva.
ShareChat has been leveraging machine learning since November last year and according to Sachdeva, it gave them a lot of gains. “After raising Series B, we deployed ML team and surprisingly the number of impressions gets doubled after a couple of months,” adds Sachdeva.
ML is also helping SharChat in weeding out pornography, abusive and violent content. “When the user posts a piece of content, it is reviewed to make sure it doesn’t violate Sharechat’s community guidelines,” adds Sachdeva.
Cracking revenue model is not challenging
ShareChat is not thinking of revenue for at least two years. “Not focusing on revenue is a deliberate decision. We follow our mantra whereby the only way to beat the competition is growth,” explains Sachdeva.
According to Sachdeva, breaking even isn’t a challenge for shareChat. “Our cost of consumer acquisition is negligible. If we generate $1 from each user (average revenue per user aka ARPU), we can cover the cost and break even,” he adds.
Although ShareChat isn’t looking to monetise, the obvious revenue generator for the company is advertising. Besides advertising, ShareChat is also betting on mini-apps by opening the platform for developers. “Mini apps would allow developers to solve simple use cases like utility bill payments, flight, or bus ticket bookings,” concludes Sachdeva.
Given that 9 out of 10 Internet users are coming from non-English speaking languages, ShareChat seemingly can be an obvious social network for them. The current MAU of 25 million looks impressive but maintaining growth momentum won’t be a cakewalk for the Bengaluru-based firm.
After experiencing growth explosion through WhatsApp and Facebook, word of mouth has been driving the growth for ShareChat. While the network effect may be working well for the company at the moment, it has to find new avenues for consistent growth.
Although, ShareChat doesn’t see any serious competition at the moment. It certainly is going to face fierce competition for Bytedance’s Helo, Twitter, and some upcoming local ventures. Going forward, it would be interesting to see how ShareChat continues its mojo and keeps Chinese heavyweights at bay.
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