This is one of the steepest valuation cuts for a venture-funded startup after having raised around $1.75 billion so far. Byju’s, PharmEasy and Udaan are among large startups that have seen steep valuation cuts in recent months.
Elevate Your Tech Prowess with High-Value Skill Courses
| Offering College | Course | Website |
|---|---|---|
| IIT Delhi | IITD Certificate Programme in Data Science & Machine Learning | Visit |
| Indian School of Business | ISB Professional Certificate in Product Management | Visit |
| IIM Kozhikode | IIMK Advanced Data Science For Managers | Visit |
A spokesperson for the company denied the development saying there is no ‘ceiling provision made in the documentation’. “The conversion will be linked to future valuation without any ceiling,” the spokesperson added.
For funding through convertible notes, a certain price range is determined for when the next round of cash infusion happens in a company. “For Sharechat, it’s below $2 billion now. Whenever the next liquidity event happens it won’t be above this price,” a participating investor in the latest funding round said.
Mohalla Tech – which houses Sharechat and short-video app Moj – has been cutting operating costs over the past year in a bid to turn profitable amid intensifying competition from rivals like Instagram and YouTube’s Shorts. Over the past one year, it has undertaken multiple rounds of layoffs to cut costs. Currently, it has more than 800 employees.
According to the company, the new funding will help it invest further behind its Ad targeting technology as well as continuing the growth of consumer transactions business on Sharechat and Moj. It claimed Sharechat – as a standalone business – is operationally profitable, and Moj is expected to achieve operational profitability over the next few months.
Discover the stories of your interest
“Their (investors) continued support in a challenging financial environment is a resounding vote of confidence for the path we have taken over the past years to move rapidly towards profitable growth. The new funds will be utilised to bolster our robust monetisation plans and propel us on our path to break-even and beyond,” ShareChat CEO Ankush Sachdeva said in a statement.The company is estimated to have closed FY24 with a revenue of around Rs 600 crore. It is yet to file its audited FY24 earrings with the RoC.