With the most recent $16 million infusion from Singapore-based EDBI, Mohalla Tech, the parent company of the short video entertainment app Moj and the vernacular social media platform ShareChat, has increased its debt round to $65 million.
Around $49 million in debt was raised by ShareChat in April from current investors, which included Temasek, Lightspeed, HarbourVest, Moore Strategic, Rimco, and Alkeon. Additionally, following its most recent fundraising effort in June 2022, the company’s valuation plummeted from $5 billion to less than $2 billion.
According to a press release from ShareChat, the extra money will be used to expand the consumer transaction businesses by investing in newer monetization features and for the advertising company’s tech stack.
According to a Moneycontrol report, ShareChat has also let go of 5% of its workforce as part of its mid-year performance cycle. The company implemented multiple cost-cutting measures and let go of 700 workers in two stages in 2023.
“…some employees are impacted based on performance. This accounts for less than 5% of our workforce. We have several open positions and we continue looking for high-quality talent across functions,” said a company spokesperson.
ShareChat reportedly raised about $1.8 billion from investors, including Tencent, Alkeon Capital, Moore Strategic Ventures, and Twitter (now X).
While the Moj app is almost operating at break-even, ShareChat claims that the app has been profitable to use for the past few months. More than 325 million people use both apps.
The Ankush Sachdeva-led company has not yet submitted its FY24 financial statements, but in FY23 it spent close to Rs 4,000 crore to generate revenue of Rs 533 crore. In FY23, it lost a total of Rs 3,241 crore.
The write-off made by the business for the purchase of MxTakaTak, a rival company to Moj, was the main cause of the spike in losses. ShareChat acquired the Times Internet-backed company for almost $700 million in cash and stock.
