Bytedance made entry with apps like ‘TikTok’ (formerly Musically) and ‘Helo’ in India. Till early 2018, local startups like Clip App (video) and ShareChat (social networking) were blossoming.
TikTok started mushrooming quite well and to counter ShareChat, ByteDance cloned the former’s model and launched ‘Helo’ in early 2018.
TikTok started disintegrated the market share of Clip App. Struggling to retain acquired users and match marketing budgets of $75 billion valued Chinese group, Clip App finally struck an acquihire deal with ShareChat.
ShareChat has been witnessing intense competition from Helo which continues to burn anywhere between $15-18 million every month over the past six months. Backed with an aggressive approach, Helo has been gaining market share quickly while ShareChat userbase is witnessing its daily active users plateau over the last quarter of 2018.
Helo had 10 million downloads in the last month. On the other hand, ShareChat numbers of install stood at 7 million.
“Everyone in vernacular content space in India is raising capital. And you are competing with Bytedance, a continuous inflow of funds anyway becomes necessary”, said one of the startup’s founders on condition of anonymity.
ShareChat has been in talks with Tencent to rake in about $200 million with the help of the Chinese MNC and others. The deal if materialises would value ShareChat in the range of $600-700 million.
If Tencent takes on the responsibility to financially help ShareChat in its fight against ByteDance’s Helo, both might stay in the game for a long run. Still, in case there is no progress towards profitability, it is all big money down the drain.