Decoding KuKu FM’s Series C round, captable and valuation

Audio content platform Kuku FM recently closed $25 million in fresh funding from new and existing investors but the specifics of the round were not disclosed. Entrackr has decoded details of the round and per our analysis, the company’s valuation hasn’t witnessed a significant jump.

The Google-backed company raised Rs 169.5 crore or $21 million, according to a filing accessed through the Registrar of Companies. Its board passed a special resolution to issue 5,49,852 Series B2 preference shares at an issue price of Rs 3,083 each to raise Rs 169.5 crore or $21 million.

New investor IFC (International Finance Corporation) and Nandan Nilekani’s Fundamentum Partnership, which is an existing investor in the Mumbai-based company co-led the round with Rs 81.5 crore each while Vertex Ventures pumped in 6.5 crore.

After this round, Fundamentum Partnership has turned out to be the largest stakeholder with 12.79% while IFC and Vertex own 5.53% and 11.12% respectively in KuKu FM. Head to TheKredible to see its complete cap table.

According to startup data intelligence platform TheKredible, the company has been valued at around Rs 1,480 crore or $185 million (post-allotment). If we compare its Series B round with the recent one, KuKu FM’s valuation increased 54% as it was valued at around $120 million when the firm raised $21.8 million Series B1 round in September 2022.

Founded in 2018 by Lal Chand Bisu, Vikas Goyal, and Vinod Kumar Meena, Kuku FM makes money through paywalled subscriptions for its audio books. It focuses on genres such as business, self-help, personal finance and claims to have more than 2.5 million paid subscribers.

Kuku FM competes with Pocket FM but the latter is almost 3.5X bigger in scale than the former as of the last fiscal year. While KuKu FM’s revenue from operations rose to Rs 41.2 crore during FY23 from Rs 4.4 crore in FY22, PocketFM’s scale stood at Rs 148.7 crore.

Pocket FM also has shown better economics than KuKu FM as the company’s losses stood at Rs 45 crore (as per its provisional financial statement for FY23) whereas KuKu’s loss expanded three fold to Rs 116 crore. Significantly, Pocket FM’s parent entity is based in the US and its financial performance may not be as accurate as KuKu FM which is originally incorporated in India.