India’s new technology infrastructure has created a platform to build domestic tech giants

In the two years since the Indian ShareChat application raised $ 4 million in Lightspeed Ventures funds, the converging trends of increasing the use of smartphones, wireless Internet connectivity and cashless banking combined to create a new giant of social media.

Now Lightspeed has confirmed that the company has raised an additional $ 100 million in a valuation of approximately half a billion dollars along with investment partners that include India Quotient, Jesmond Holdings, Morningside, SAIF Partners, Shunwei Ventures, Venture Highway and Xiaomi.

In the years since that first investment in Lightspeed, ShareChat went from being a company with 1 million monthly active users to 25 million monthly active users, and while the company lags behind the messaging giant WhatsApp (whose application is used by more than 200 million people in India) its growth in India is remarkable.

"ShareChat really seeks to take advantage of the next billion users in India," says Ravi Mhatre, partner at Lightspeed, whose investment dollars helped architect ShareChat.

What is giving this startup the ability to connect with those next billion users is a strategy of a nine-year plan to develop what has been called the "India Stack": a completely new digital infrastructure for a country with a population of 1.32 trillion distributed in an area of ​​almost 1.3 million square miles.

The momentum began in 2009 with the launch of the national biometric recording scheme of Aadhaar, India (recently amended). Seven years later, it made a great leap with the implementation of the national demonetization plan and the almost simultaneous deployment of a 4G high-speed mobile network throughout the country.

While the demonetization strategy was eaten in growth rates across the country, and probably did not reduce the amount of money in circulation, according to the Indian financial publication LiveMint the launch of 4G was a big success.

Since Jio, the telecommunications arm of giant industrial conglomerate Reliance Group, launched its 4G service in September 2016, adoption rates across the country have skyrocketed.

According to a report by the telecommunications analysis firm, OpenSignal, Jio's contribution to the Indian network has been massive.

During the quarter ending in June 2017, the total use of data stood at more than 4.2 million terabytes, of which 4G of data represented 3.9 million TB, according to TRAI. Growth is most visible when the numbers from a year ago are verified, when the use of 4G data was only 8,050 TB; that's a 500-fold increase … [And] The availability of LTE in India is remarkable: users were able to connect to an LTE signal 84% of the time, an increase of more than 10 percentage points over the year previous. This places India ahead of more established countries in the 4G landscape such as Sweden, Taiwan, Switzerland or the United Kingdom.

For a startup like ShareChat that means tens of millions of daily active users, according to Mhatre.

Users are attracted to the ShareChat broadcast chat feature, which allows cell phone users to convey conversations and comments on any subject they desire. "It is a platform where the content that is relevant to you is presented and committed to it," says Mhatre.

The company was founded by three developers based in Bangalore. Farid Ahsan, 26, Ankush Sachdeva, 25, and Bhanu Pratap Singh, also 26, all graduates of the famous IIT Kanpur University in India, had worked 17 different prototypes for a product before they finally decided on the version that would become ShareChat. [19659005] The founders of the company are also taking a page from the popular Chinese application WeChat and hope to turn their broadcast chat service into a platform for micropayments, education and other types of entertainment.

What began as a niche site for people to communicate in their local dialects could become the first true giant of national social networks in India.

There are other Chinese corollaries in ShareChat businesses that can be informative. Toutiao, the news aggregation service owned by Bytedance, is perhaps the closest in this type of ShareChat at this time, but even that is only necessary to a certain extent.

China's infrastructure is still based on personal computers and landlines, while India is fully mobile first. For Mhatre, it is the first country to make the leap to a digital economy based entirely on mobile computing.

In Lightspeed, the opportunity presented is similar to the birth of the Internet in the mid-1990s in the USA. UU And the technological boom of the end of 2000 that created billions of dollars in value for companies like Alibaba, Baidu, and Tencent.

makes this feat even more impressive was that until two or three years ago, it seemed that India it would not live up to the expectations that had been established and the emerging market countries such as Russia and Brazil that comprise three-quarters of the BRIC countries that were supposed to be the fundamental pillars of the 21st century global economy.

"I f you look at China: the GDP in China is $ 12 to $ 13 billion … India is about $ 2.5 billion [but] inf The structure developed there before that in India", said Mhatre. India is at the same turning point now, where the boom in infrastructure is contributing to the development of new business models.

The limitations of that infrastructure have also informed the ShareChat business that it has also been built. Because although digital penetration rates in the country are high, download speeds are exceptionally low (due in part to the overwhelming demand).

Again, the OpenSignal report is informative.

While the availability of LTE had a meteoric rise, the same can not be said for 4G speeds. In our latest LTE State report, India ranked lowest among the 77 countries we surveyed, with average download speeds of 6.1 Mbps, more than 10 Mbps less than the global average.

ShareChat focuses on sending messages and sharing light images a platform that adapts to the current strengths and limitations of India's infrastructure. "S has 500 million people with a high-speed Internet terminal on hand and they want to do things with it," Mhatre said. And ShareChat is not only located in its technological stack. The company is also localized by language.

As the investors in Lightspeed pointed in their thoughts about the agreement.

The "next billion" users in India speak 22 different languages ​​and spread across an area the size of Europe. The founders of ShareChat Ankush Bhanu and Farid impressed us with their vision of this new user base. Their first contact with this user base came in 2015 when they noticed that the exchange of photos, videos, poetry, jokes and even good morning messages was at epidemic levels on WhatsApp. However, there was not a single and easy to find store to find this content. ShareChat was born to solve this problem. As they developed the idea, they also saw that this audience was hungry for connection and content about their cities and towns of origin. They noticed an emerging behavior around users who wanted to "look good" to their friends by finding the best content, resolving loneliness by finding friends in their own language and even wanted to bring fame and celebrity to their own geography.