Carwale Raises $7 Million From Sierra; Isn’t Looking At Another Round

It’s been over 7 months since we first heard about Carwale.com raising $7 million from Sierra Ventures, and almost six months since CEO Mohit Dubey first publicly disclosed the funding at a Startup Saturday, though he didn’t mention the investors then.

The money appears to have taken a long time coming, and Carwale has now announced that they’ve raised upto $7 million from Sierra Ventures, in a Series A round of funding. So the money’s in the bank now. Remember that Carwale had reportedly sold 30% stake to SeedFund, an early stage investor, and it is worth noting that Sierra Ventures is one of the investors in SeedFund; Dubey told MediaNama that SeedFund had introduced them to Sierra Ventures.

Have promoters sold out majority stake?
Industry sources put Carwale’s valuation at around Rs. 48 crores, and suggested that they’ve sold around 25-30% stake to Sierra. Dubey declined to confirm the valuation and how much stake they’ve sold, but said that this has been a fresh issue of capital. He also declined to comment on whether the promoters still hold a majority stake in the company, and refused to disclose Seedfunds current holding in Carwale.

On revenues, targets and leads:

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Interview: Salil Bhargava, CEO of Jump Games Says The Indian Mobile Games Market Is Rs. 30 Crores; Things More Sane Now

In Part 1 of this interview, Salil Bhargava, CEO of Jump Games, a Reliance Entertainment company, had told MediaNama had outlined the companys plans for the US market. Interestingly, he had said that, at present, around 70 percent of their revenues come from overseas. Part 2 of our discussion with him, he talks about how the mobile gaming market in India has changed over the past year:

How big is the India market, if you take out the operator share?
If you take out the operator share - there are taxes etc - but I don’t think it’s more than Rs. 30 crores. But there are new revenue streams that are making a difference - like using mobile advertising and WAP site. It’s still small, but those kind of models will also emerge in India.
Is there a significant dependancy for you on Reliance Communications for revenues?
Not at all. There’s no dependancy at all. We’re operator agnostic. We’re a part of Reliance Entertainment.
Is the mobile gaming business in India viable yet - standalone?
Not yet, but I think it is becoming more and more viable for the existing players. There are very few people left in India.
What happened in India?
Most of the players who were focused on 20 other things, have stopped making games, or figured that they really can’t compete with those who’re making high quality games, which is what the operators are beginning to ask for in India as well. A lot of those people who flooded the market with a lot of content, are now beginning to fall off the radar in terms of mobile gaming. Most of them doing all kinds of other stuff also, and they’ve gone back to doing other things - ringtones and wallpapers business, and some becoming a platform company.
Are you in the black in India?
We’re privately held so I can’t disclose. We as a company don’t focus purely on India. What we have is a global deployment team. We have a team which does some aggregation for India, but in terms of deployment, it’s a global deployment. It’s still early for us as a company - we’ve only completed two years of the company.
Well, I’m asking because I’ve heard that Paradox Studios (the previous avatar of Jump Games) was shut down as a sick company…
No. I don’t know where you’ve heard this. It was restructured because all the people moved and started a new company called Jump, as a part of Reliance Entertainment. Paradox Studios was a legacy company, and used to do different things, including PC and console stuff. When we started Jump, we took a decision to focus on Mobile.
What kind of games are you making? Any iPhone games?
Not for India specifically. We do have the SDK and our teams are working on it, and we should have a game ready in the next 3-4 months.
What about multiplayer games?
We’ve done a few in the past as well. Its very early, and the bread and butter of this business for quite a while is going to be single player casual games. That’s not going to change anytime soon. A lot of people talk about multiplayer and bluetooth games, but its easy to stay in the news that way. The number one mobile game of all time is Tetris. It’s just a simple fun game. Most consumers don’t want to press a million buttons - they don’t want to complicated a game.
What needs to be done to ease the process of game discovery in India?
I honestly think, it’s education from the operator themselves, and the real growth will come when the subscriber growth starts tapering off. It’ll lead to a spurt in data. It’s understandable - for example, if an operator has $100, he’ll spend the money on subscriber growth. When that starts tapering off, he’ll still have $100 to spend. I honestly think it will take 2-3 years.

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Interview: Jump Games And The US Mobile Games Market; 70% Of Revenues Are From Overseas

Reliance Entertainment company Jump Games launched its US operations, setting up shop in Chicago. Jump has also set up an office in Singapore, and announced plans for a London office. Remember that Jump has licensed Manchester United content for a period of 3 years, a deal that is believed to be worth over $50 million. MediaNama spoke to Salil Bhargava, CEO of Jump Games. In Part 1 of this interview, Bhargava talks about the US market and why they launched services there, what they are looking for in an acquisition, and most importantly, how mobile operators across the globe have changed the policy for accepting games:

Why have you entered the US market?
Wel, if you look at the mobile gaming industry, the US is a very very important part of the business: from a geographic point of view, there are only five or six carriers. It’s easier to do business: it’s a very well established business model in terms of revenues and operator share. If you look at US, it’s a very big driver of mobile gaming revenues - maybe two or three years ago that wasn’t the case, but it has rapidly become a much more important market than Europe as well.
How big is the mobile gaming market in the US, if you take take out the operator share?
If you take out the operator share, it’s around $400-500 million. It’s the largest market in the world, in terms of a single country. If you include the operator share, it’s almost a $1 billion market, with operator shares at 50 percent. Verizon is the largest, then there’s Singular and AT&T.
How much are you investing?
We’ve opened an office in Chicago, and will be adding sales and QA (Quality Assurance) people in the US, because a lot of network testing can’t happen in India. Ultimately, over the next year, we really want to establish a design studio there. We’ve built the back-end infrastructure here in India. If you look at all the global majors, it’s a rapidly consolidating market. All the ones who are successful right now were the ones who were early enough to establish a back end, particularly here in India. Our focus has been to build out our back-end infrastructure. The idea is that by end of March, we will be 250 people in Pune, and leverage the lower cost infrastructure we have here to feed all the markets. Game design and high-end game production - even on the cell phones - I don’t think we have the experience yet. It could be a 10-15 people studio for concept work and building, and the porting and maximum QA happens here in India, and last bit of the QA in the US.
Why are you planning a design studio in the US?
The carriers have become very strict about the criterion. There’s a 3 strike rule, and game can get pushed to the back of the queue. We have to be careful about the criteria now. All these things really lengthen the process from creation to going up on the deck. In India, we really need to improve on the design capability. Today we outsource most of the game design - the concept, not the artwork. The artwork is good in India. Which is why we want to establish a design studio. Over a long term, we want to transfer that knowledge to India.
What kind of an investment would it require to set up a design studio in the US?
Really depends, but you’re looking at around a $1 million at least - it’s really about the people. At the same time, there are opportunities for inorganic growth. There’s so much consolidation in the mobile gaming business - the smaller companies are feeling the heat because of the credit crunch. So we’re talking to people, and looking - when the right opportunity comes, we’ll take the decision.
What capabilities are you looking for, in an acquisition - market presence, content licenses….?
There are various criteria - definitely one of things we’re looking for is distribution - would it be easier for us to buy instead of setting up our own distribution channel, which we’re in the process of creating. We’re looking at people, technology, design capabilities, content library.
Have you set a timeline by which you have to close this?
No deadline as such, but there is an active interest.
When will the US start contributing to revenues for you?
Well, it already is. We have multiple relationships, but it’s very important for us to have a local presence. Amit, whom we’ve hired, is the global head of sales.
How does South America play out as a market for you?
It’s a very interesting market - so far we’ve done things through partners, but we’re getting a lot of interest for the Manchester United content. Brazil interests us a lot - it’s a $200-300 million dollars as a market, then there’s Argentina and Mexico. The Americas office in the US will cater to entire South America. We’re looking to increase the content portfolio.
What about US as a content licensing market?
The US is still one of the more significant generators of content, which appeal globally. So we’re very strongly looking at enhancing that portfolio. One is from a game licensing perspective - and if people have content libraries, we might even buy them out.
What was the reasoning behind the Manchester United deal? Just getting a big brand?
We really wanted to establish ourselves in the world market, and we couldn’t think of a bigger brand than Manchester United - it’s among the top 10 recognized brands. And definitely there are revenue implications.
Do you see a revenue of above $50 million from Manchester United content?
I’m really not going to go into revenue figures - I’m contractually bound.
How many operators are you live with?
We’re live with 5 operators in India, and around 45 globally.
How much does International contribute to your revenues?
Around 70 percent.
How is the your pay-per-play model been doing in Europe?
It’s been doing okay. The whole pay-per-play model hasn’t been pushed yet in Europe. There’s just a lot of consolidation taking place in Europe. A lot of partners we’re working with right now are focused on that. The pay-per-play model, in 2-3 years, is going to be an important part of the business. The margins on the pay-per-play are similar as in case of downloads. Pay-per-play model is where a good game makes a big difference. At times, we’ve made more money on pay-per-play than pay-per-download.

Tomorrow, in Part 2: The Mobile Gaming market in India.

Related:
– Ozura To Power Tournament Based Mobile Gaming Community In India
– @IAMAI MVAS: Consumer Segments & Content; Ad-Funding vs Ad-Subsidized
– @IAMAI MVAS: “What’s in a Game? It’s All In The Name”; Only 2-3 Players In Mobile Gaming In India?
– Jump Games Launches US Operations; Mobile Gaming Industry Woes

ValueFirst To Raise $5-8 Million Says CEO Vishwadeep Bajaj; Apurva Kumar Joins From Naukri As COO

Update: I spoke to Valuefirst CEO Vishwadeep Bajaj, who confirmed Kumars appointment. Kumar is joining with a stake in the company, but Bajaj declined to elaborate on the details. Kumars mandate will be to “scale the business, and launch new verticals, particularly given his experience with Shiksha.”

Bajaj has said that Valuefirst will be announcing their funding - of between $5-8 million, within a couple of weeks. Our sources had told us otherwise, and we stand corrected. He declined to disclose the investors (yet). The funding will be used to expand the company to new domains, in particular - to Voice and the Internet. ValueFirst had revenues of around $10 million last fiscal, and have set themselves an ambitious targest of $25 million this fiscal.

Bajaj said that they don’t see ValueFirst as just a bulk SMS company, but an Enterprise Mobility company - “We mobile-enable the process. We don’t just sell a pipe, but integrate with the CRM app and SAP, whatever the legacy, and move data over the mobile network.” The company will invest the money into internal processes and IT systems. The company has an international presense in the Middle East, UK, Nepal, Bhutan and Pakistan, and intends to expand into developing markets where Internet penetration is low, and mobile is the base.

Original story: Apurva Kumar, VP & National Head for Mobility, Ad Sales and Investments has left Info Edge (Naukri.com) to join ValueFirst, a Mobile Data Services, company Chief Operating Officer. Kumar will be reporting to CEO Vishwadeep Bajaj. Kumar was with Info Edge for around 3 years, during which period the company went in for a public listing.  (Right: Apurva Kumar at the MediaNama Launch Seminar & Mixer)

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Car & Health Insurance Will Be 50-60% Of The Online Lead Generation Business In India - Yashish Dahiya, CEO, PolicyBazaar

eTech Aces yesterday announced that they’ve raised 49 percent stake from Info Edge India (Naukri), for Rs. 20 crores. Yashish Dahiya, CEO of eTech Aces (PolicyBazaar) has been in the online insurance business before - he was the CEO of First Europa, a Global Online Insurance Broker with operations in 9 countries, prior to which, he was the MD of ebookers Plc. MediaNama spoke to Dahiya about eTech Aces’ fund raising and growth plans:

Why did PolicyBazaar raise money from a strategic investor, instead of a financial investment from VCs? Wouldn’t it have been better to take financial investment now, and then a strategic investment at higher valuations?
For a few reasons - over time we will be applying for our own insurance brokerage license. There are restrictions on foreign investment there - that was one reason for going for a domestic company. Number two - I’ve been a manager all my life. I think an investor has a very different view to things, than an executing entrepreneur. When we started looking for an investor, within a week we had narrowed down on Naukri. They have a lot of experience, and we’ve already gained from the discussions with them.
But you’ve sold them a very high stake - wouldn’t selling 49 percent hinder further fund-raising? Does Info Edge have an option to acquire 100 percent?
I envisage taking this company public over the next 5 years, and I don’t think we’ll need more funding than the amount we’ve raised already.
Why take funding at all?
We’re not yet a profitable entity, and we needed a larger investment. We’re going to have physical offices in around 12 cities by the middle of next year. First we’re after NCR, and then southern cities. All that will require operating cost funding.
What kind of revenues does the company have? How many policies do you sell in a month?
I’d prefer not to talk about those details at this point in time.
Are you looking at only a lead generation model, or will there be more revenue streams?
We’re looking primarily at lead generation. However, eTech Aces also passes leads to brokers. We’re not the brokers, and do not close the transaction, and we never get the insurance premium. We will focus on the insurance business for now. My view on the lead generation business is that over the next 5 years or so, we will see car and health insurance emerging as 50-60 percent of the lead generation business. This is based on what takes place in the UK and the US markets. In UK, cars are a very large segment, and health in the US. For example, MoneySupermarket is a site for all products, but 50 percent of their sales is car insurance. We will also get into loans, but later.
What is your biggest challenge?
Volume is the toughest bit. This is an industry shift, so online will take time.
How do you get the volumes?
We’re starting a radio campaign, followed by certain offline activities. We do a lot of search marketing. The global trend is that the online Insurance business is lagging the online travel business by around 2 years. So we are partnering with travel websites, for setting up insurance segments. These will be white labeled deals.
What are your margins on online marketing?
At present, revenue generated through online marketing is about 3-4 times the marketing cost. That’s given us confidence to get behind this model. There is an offline component to this business: Companies contact us for insurance comparison, for quotations, and we pass the leads on to companies. But in the end it’s all web generated, even though the fulfillment happens offline.

Disclosure: I own an inconsequential number of shares of Info Edge India

LiveJournal Goes The YouTube Way In India; Hosts Zoom’s Bollywood Club

BCCL Owned TV Channel Zoom TV will be hosting their Bollywood Club community at LiveJournal (LJ); this is the first such “Partner Community” for LiveJournal. Bollywood Club is essentially a talent show on TV, featuring a talent pool of actors, singers, writers, lyricists etc.

What’s interesting is that the same content is available on both Zoom’s site, as well as the LiveJournal community.

Sameer Pitalwalla, Head of Digital at Zoom TV told MediaNama that LJ is hosting the community for ZoomTV for free. Why isn’t Zoom hosting the community themselves? Says Pitalwalla: “the (Zoom) website is where people come to read and view Zooms content- it is top-down. We don’t have a platform ego. If there any way of monetizing a community for us? No! Are into banner ad sales? No! Our sales team doesn’t go around selling banners for the website. We partner with Ad Networks for that.”

Zoom is bunding the LiveJournal community as a part of the advertising offering to Idea, and LiveJournal will be promoting the community on its platform. So that’s what they’re getting out of it. Pitalwala wouldn’t comment on whether LiveJournal paid Zoom for the community. Zoom also hasn’t given a commitment for promoting the community on TV, but it will be providing some support via their Audience Network.

In an emailed response to MediaNama, Benjamin Wegg-Prosser, Director of Corporate Development, SUP said that the content on Zoom’s site does not have commenting or social functionality, while LJ does. They believe their users will use the socialisation features. He says that given that LJ is just starting in India, it is important for them to work with new partners and develop new areas of expertise.

The deal with Zoom is a pure marketing relationship, similar to that which Google runs with partners through YouTube. On who has the rights to serve ads on the BollywoodClub Community, Wegg-Prosser said that they’re not monetizing the community at the moment. When they do, they’ll discuss it with Zoom. “In some cases we do rev share and in other cases we do not, it all depends on the deal.”

Shine.com: “We’re Not In The Pricing Game” Says Amit Garg, Business Head, Firefly

Shine.com, the Job portal from HT Media’s Firefly eVentures, has announced that they’ve crossed the 1 million registered users mark. These are tough times in the job portal business - ClickJobs- is looking for a strategic partner, and was in talks with Reliance for an exit; Cybermedia sold its resume database to TimesJobs. MediaNama spoke to Amit Garg, Business Head of Firefly e-Ventures on a number of topics - the sales cycle, the impact of the downturn, advertising spends, and debated their pricing strategy:

What is your “Active” userbase, as opposed to a registered user base?
We have a different way of looking at the userbase. People don’t have to come back to search for a job. They will get an automatic alert in case of relevant jobs. Crossing 1 million is encouraging for us especially since our registration process is long and we’re capturing a lot of data. Our technology works on structured capturing of the data - work experience, skill sets, education, preferences etc, and the form is almost 5 pages long.

Userbase and Clients

How many jobs do you have on the site, and what is your client base?
We have over 5000 jobs on the site, and around 2000 plus customers. These are split across IT, Infrastructure and Retail, and it mirrors the market.
You made a claim that “Shine has a high proportion of qualified candidates who are not available on other job sites.” How do you know?
Comscore gives you certain data - that more than 20 percent of our users are not there on other sites. Those are users unique to our site
Comscore doesn’t have access to unique registered users on other job sites…
I’ll have to check up on that. But even in the demonstrations we’ve done, often we throw up candidates that are not there in other sites. One of the things that we offer is anonymity. People who choose to remain anonymous, are often those with at a very senior level. Update: Garg has confirmed that Comscore gives them unique visitors and not registrations.

Sales

Out of the over 5000 listings, how many are paid?
A substantial amount. We only offer 1-2 postings as a demo.
And how many people are there in your sales team?
We have over 100 people, spread across seven locations.
What is the sales cycle in this industry like?
It differs - corporates, at times, take a long time. It could take 15-20 days to 1-2 months to crack a corporate account. Recruitment consultants have 1-2 decision makers, so its much faster with them. Consultants can be closed within 1-2 visits.
Where do you see a gap in the market?
The gap is there in terms of the existing set of customers getting a differentiated product. The fact is that recruitment consultants form a huge bulk of the market, and we have to serve that segment very very well.
But they’re already using Monster or Naukri. How do you approach them? What’s the conversion rate?
We had given a free trial period, and now we’re reaching out to them to convert them to paid accounts. I can’t talk about the conversation rate. The ability to get relevant candidates is significantly higher with us, and that’s what we’ve pitched.
The other sites rely on giving access to resumes - that’s more information than you are giving access to…
We don’t allow access to resumes, but I wouldn’t agree with the notion that they’re giving access to more information. We have a system which scans the database, and gives all relevant candidates. Also, they are alerted about new registrants who match requirements.

More on Advertising, Acquisitions and Gargs thoughts on Pricing, particularly on a price war: (more…)