The Chinese company, which first invested in VerSe Innovation in 2016, has sold its stake to existing investors, Ontario Teachers’ Pension Plan (OTPP) and Canada Pension Plan Investment Board (CPPIB), through a secondary deal, according to the filings.
In a secondary transaction, existing investors sell shares to new investors and the money does not go to the company.
ByteDance sold more than 139,000 shares to OTPP and over 162,000 shares to CPPIB.
The Chinese firm sold these shares for close to $102 million, as per the filings.
According to a back-of-the-envelope calculation, this translates to a more than $232 million payout for ByteDance at the
last primary fundraise valuation of $5 billion, leading to a 56% discount in the secondary share sale.
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ByteDance’s exit from VerSe Innovation comes at a time when it is also exploring a re-entry to India through a new partnership with the Hiranandani group, ET reported on June 1.
The company is looking to strike a new partnership in India and rehire former and new employees as it seeks to re-enter one of the world’s largest internet markets, several people aware of the matter told ET.
In April, VerSe Innovation said it had signed definitive documents and raised $805 million in a new funding round led by existing investor CPPIB.
CPPIB said it invested $375 million in VerSe as part of the fundraising in April and another $50 million was invested in January this year.
The Dailyhunt parent was valued at around $3 billion after a $450 million funding in August last year, led by marquee global investors including Siguler Guff and Baillie Gifford. Prior to that, it had picked up $200 million from the likes of Falcon Edge Capital, Glade Brook Capital Partners, Google, Microsoft and QIA.
The company has raised $1.5 billion in the past one year, underscoring the capital-intensive nature of the sector.
VerSe Innovation did not immediately respond to ET’s queries.
According to VerSe Innovation, Josh has 150 million monthly active users with 49% of them being daily active users, while Dailyhunt serves more than 350 million users every month.
The company has said previously that it is looking to offer Web 3.0 experiences across languages on its platform, besides trying social commerce, live commerce and influencer-led commerce.
VerSe Innovation’s rival Mohalla Tech, which owns local language social network ShareChat and short-video platform Moj, is said to be closing a $300 million funding from Google, Singapore’s Temasek and other investors.
In February, the industry saw a significant consolidation with ShareChat’s Moj and Times Internet’s MX TakaTak announcing a merger. Times Internet is part of The Times of India Group which also publishes The Economic Times.
Platforms like MX TakaTak, Moj, and Josh came into prominence after India banned a slew of Chinese apps including TikTok in 2020 following border hostilities with China. Instagram Reels and YouTube Shorts are among the apps that compete with Josh.
