Social media platform ShareChat’s parent Mohalla Tech (which also operates Moj) has entered into a strategic partnership with Times Internet-owned short video app MX TakaTak, operated by MX Media. The plan is to build India’s largest short video platform — controlled by ShareChat.
According to sources aware of the development, ShareChat is acquiring MX TakaTak. The deal is supposed be a cash-and-stock deal of about $700 million.
People in the know said that post-acquisition, MX TakaTak’s 180-200 staff will be absorbed by Mohalla Tech, which operates its competitor Moj.
‘India’s largest content ecosystem’
The two platforms will continue to operate separately but the eventual plan is to merge the brands. The companies confirmed that post this transaction, MX Media and its shareholders will become strategic shareholders of ShareChat.
Ankush Sachdeva, CEO and Co-founder, ShareChat and Moj, said, “We at ShareChat are building India’s largest content ecosystem which has been on an unprecedented growth trajectory. MX TakaTak is a popular platform and this merger further solidifies our position in the short video ecosystem. With this development, we aim to build the largest original content platform on Moj along with the largest community of users across India.”
“The deal has been in talks for at least six to nine months. It is happening at a good valuation for Times Internet as well. Times Internet knew that this is the highest they could get with the platform. To move on to the next level, it had to add a lot of money muscle. On the other hand, with this deal, Moj is easily doubling its user base,” a source told BusinessLine.
Doubling user base
Industry experts believe that more than features and functionalities, the deal is about user base consolidation which will eventually attract top content creators, in turn bringing top advertisers.
Sanchit Vir Gogia, Chief Analyst and CEO of Greyhound Research, told BusinessLine, “Moj has about 160 monthly active users (MAUs) and MX TakaTak has about 150 MAUs. On combining these, they would have about 300 million users. Their local competitor Josh has about 115 million. It’s all about volumes and engagement. In the short videos segment, you also have Instagram Reels and YouTube Shorts. And Shorts is doing very well. These apps would need to attract advertising dollars which will be based on the ability of these platforms to attract top content creators.”
The combined platform will have 100 million creators, over 300 million MAU, and nearly 250 billion monthly video views. At present, Moj has over over 50 million creator communities in 15 Indian languages and MX TakaTak operates in 10 languages.
Crowded market
The powerful content creators will only go where the number of users are very high. Ultimately, this is going to all about social commerce.
Gogia added, “Moj and MX TakaTak are more relevant in Tier 2 and Tier 3 towns where Instagram Reels and YouTube Shorts are not doing that well. The short video industry is now seeing a crunch. For instance, Chingari started as a short video platform and is now looking into crypto. Mitron TV too was suffering and had to lay off employees.”
According to a report by Redseer, outside the top 50 cities, total MAUs forecasted in CY2021 for shortform videos stood at 170-190 million. Meanwhile, overall organic growth in time spent on shortform video grew 57 per cent as compared to 8 per cent growth for usual social media platforms.