Music and podcast streaming platform Gaana has raised $50 million in a fresh round led by existing investor Tencent along with participation from Times Internet. The fresh infusion will provide much firepower to the Prashan Agarwal-led company which has been competing with rivals such as JioSaavn, Spotify, YouTube Music and Wynk.
This investment comes over two years after Tencent led a $115 million round in Gaana, which also counts home-grown smartphone maker Micromax as its early backer.
The Chinese tech giant has pumped in Rs 300 crore or $40 million through its European entity Tencent Cloud BV in the latest round and Times Internet has infused Rs 75 crore or $10 million, regulatory filings show.
Gaana has allotted 58,813 optionally converted debentures at Rs 63,761.93 per share to raise the aforementioned sum. Following the investment, Tencent’s holding in Gaana has increased to 34.44% and Times Internet’s stake has been diluted to 60.18%.
ESOP pool consists of the remaining 5.38% stake in the music streaming platform. As per Fintrackr’s estimation, Gaana has been valued at around $530 million in the current round.
This is Tencent’s fifth investment in Indian startups this year. In the past eight months, it has invested in Khatabook, DoubtNut, Pratilipi and food delivery major Swiggy.
After a ban on TikTok and other short video apps linked to China, Gaana had launched HotShot, its own short video app. Gaana claims to have 185 million monthly active users and it is targeting to reach 250 million MAU by March 2021. It has a music library of 45 million songs along with 5,000 user-generated podcasts per month in multiple genres and languages.
Importantly, regional content drives close to 35% of its overall consumption.
During the lockdown, Gaana has recorded a 10-13% surge in consumption of music and podcasts and going forward, HotShot may attract millions of new users who have been looking for an alternative to TikTok.
Meanwhile, Gaana’s top competitor JioSaavn has also started leveraging its user base to promote the US-based short video app Triller within its app. The RIL-owned music streaming app will allow its users to create videos on Triller.