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Newshunt raises Rs 100 crore from Sequoia Capital India; On Ver se’s pivot

NewsHunt LogoMobile content application NewsHunt (Ver Se Innovations) has announced a fund raising of Rs 100 crores, in a Series B round led by Sequoia Capital India, with existing investors Matrix Partners India and Omidyar Network also participating. We weren’t aware of Omidyar Networks’ previous investment in Newshunt.

Newshunt claims to deliver 1.5 billion pageviews on its app daily, and has over 14 million monthly active users. Almost every main publisher in India is on NewsHunt, which monetizes through mobile advertising and purchases: the company has recently entered the ebooks and magazine singles market, integrating a payment gateway allowing viewers to pay for content using carrier billing, and claims that over 4 million local language ebooks have been downloaded in the past six months alone. For an ebooks business, that’s a massive.

What’s important here is that the company has great synergy with another business it launched: the iPayy carrier billing platform, which is being used by Newshunt for its content, as well as third party developers.

In all of this, lets not forget a few things about Ver Se:

– NewsHunt wasn’t founded by Ver Se. It was acquired by them from Rediff backed Eterno Infotech in 2012. Founded by Chandrashekhar Sohoni, I remember the company having a ridiculously simple, two page contract for bringing publishers on board, with virtually no lock in. Rediff lost that opportunity, among a several others.

That said, Ver Se built upon the platform they acquired and integrated the iPayy payments solution that it had, via its relationships with telecom operators. They’ve brought on board ebooks and magazine singles (which, we’ve heard anecdotally, is doing very well for publishers).

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– Ver Se used to do SMS based job listings: While Ver Se might be News Hunt now, it began as a company incubated by Onmobile Global, and provided job listings over SMS, during the murky days of telecom subscription in India. That VAS business declined dramatically once the telecom regulator TRAI clamped down, as is evident from the condition of Ver Se’s former parent co Onmobile.

This is an excellent pivot from Ver se, and where they gained by buying Newshunt, Onmobile and Rediff lost.

 Its past stake sales are not very public: OnMobile had incubated the company in 2007, with a total investment of Rs. 5.5 crore (for 51% stake), following which Matrix Partners had invested Rs 20 crore in the company. In 2010, Onmobile sold 8% in Ver se for $1.8 million, to a still undisclosed investor, and 9% for Rs 28.59 crore, again, not naming a buyer. Onmobile is a publicly listed company.

Onmobile eventually exited Ver se in 2013. Our note from that time, looking at Onmobile stake sales:

– 29th September 2009: sold 5.08% for Rs. 3 crore, valuing the company at Rs. 59.05 crore (source)
– 31st July 2010: sold 8% for Rs. 11.112 crore, valuing the company at Rs 138.9 crore (source)
– 7th February 2011: sold 9% stake for Rs 28.592 crore, valuing the company at 317.69 crore (source)

To put things in context, Onmobile Global’s current market cap, at Rs 34.35 per share, is Rs 391.31 crore. Times have changed.

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Going forward: the local language focus

In the press release, Viru Gupta, CEO of NewsHunt, says that their plan is to “work closely with publishers, developers, OEMs and other ecosystem partners to digitize, distribute and monetize the consumption of local language. NewsHunt offers news from over 100 news sources in 12 languages with over 25,000 articles everyday. iPayy is integrated with 5 major telcos in India and is currently used by 300 digital goods merchants.

At MediaNama’s #NAMA Indic event in Bangalore in July, Vishal Anand, Chief Product Officer of NewsHunt, mentioned a few interesting points about NewsHunt’s Indic language performance:
– when they tested Indic advertising, they found that the clickthrough rates were double of English ads.
– “Since we launched ebooks, we’ve seen a little over 3-3.5 million books downloaded. We’re still very young. We have hundreds of books that have crossed that threshold of 10,000 copies. Almost all the books – around 90% – are Indic. The Right medium, right audience and a distribution channel that didn’t exist before.”

Also read:
Good move: NewsHunt debuts magazine singles with Delhi Press; Our Take
NewsHunt Launches E-Books In 4 Indian Languages On Android
Exclusive: NewsHunt Acquired By Ver Se; Rediff Exits
Ver Se Launches Carrier Billing Platform iPayy
Rediff Q4-FY12 Concall: On Advertising Trends, Eterno Sale, Mobile & E-Commerce Business
– More from our #NAMAindic event here.

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Written By

Founder @ MediaNama. TED Fellow. Asia21 Fellow @ Asia Society. Co-founder SaveTheInternet.in and Internet Freedom Foundation. Advisory board @ CyberBRICS

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

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