New investors like Ontario Teachers’ Pension Fund, Luxor Capital and Sumeru Ventures, and its existing backers such as Sofina Group, Baillie Gifford and others have also participated in this round.
The Bengaluru-based firm said the latest fundraising will take its valuation up to $5 billion, post the investment.
CPPIB has invested $425 million, contributing almost half the total capital mopped up by the company, which began life with the Newshunt portal in 2007.
VerSe Innovation was valued at around $3 billion
, after a $450 million funding in August last year and prior to an investment by Google and Microsoft. The company has raised $1.5 billion in the past one year, underscoring the capital-intensive nature of the industry.
While VerSe’s core business of DailyHunt clocked $127 million in revenue in FY22, the intensely competitive and cash-guzzling short-video segment
saw a significant consolidation with ShareChat’s Moj and Times Internet’s MX TakaTak merging in February. These players came into prominence after India banned a slew of Chinese apps including the popular short-video app TikTok, owned by Bytedance in 2020. Moj, MX TakaTak, Instagram Reels and YouTube Shorts are among the apps which compete with Josh. Times Internet is part of The Times of India Group which publishes The Economic Times.
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The company said Josh boasts of 150 million monthly active users with 49% of them being daily active users. DailyHunt serves more than 350 million users every month, it says.
Besides DailyHunt and Josh, VerSe Innovation also houses PublicVibe, which is a hyper-local video platform.
Cofounder Virendra Gupta, and Umang Bedi, former Facebook India managing director who is also designated as a cofounder at the Bengaluru company, told ET in an interaction that they would continue to invest in the short-video business and go behind commerce through various models.
“This is the single largest investment by CPPIB in an Indian startup and what makes it interesting is the timing, when companies in India and globally are finding it hard to raise money and down rounds are happening,” Bedi said.
Where will the funds go?
Gupta and Bedi said they would deploy parts of the new capital to “deepen and broaden” its artificial intelligence, machine learning and data science capabilities for better user engagement, retention and monetisation.
VerSe is also looking at offering web3.0 experiences across languages on its platform, besides trying social commerce, live commerce and influencer-led commerce. It plans to partner with leading ecommerce companies and go big with the creator community.
Bedi said they are also aiming to build monetisation models for short videos. “This includes shoppable commerce experience, influencer commerce, live commerce and extending to influencers a brand new Web3.0 platform experience which will help them monetise from audiences, not just here but we would be glad to take it global,” he added.
The company is expected to announce its entry formally into commerce in the coming weeks. “User experience has to be nice. When we do things, it has to scale beyond announcing a pilot. That’s why the new mediums of monetisation – via influencer led commerce – of short videos are being built in a very integrated way,” Gupta said.
