On May 22, NewsDog, a news aggregator serving the Indian market, closed a USD 50 million Series C funding round led by China’s tech giant Tencent, with DHVC, Legend Capital, and Dotc United Group also participating.
The startup was cofounded by Forrest Chen (Yukun Chen) and Yi Ma in 2016. Though only two years old, NewsDog has topped the Indian Google Play store news category and claims over 50 million users. The news aggregator not only provides content in English but also in ten regional Indian languages.
The startup plans to use the funds to build its network of professional content creators as well as further develop its products. With the fresh capital, the company will also beef up its technical capabilities to improve users’ personalized experience and provide content in more local languages.
China’s players enter the content aggregation space in India
As the number of mobile Internet users in India has grows, many players have entered the content aggregation space, such as Alibaba-owned AUC News, Toutiao-backed Dailyhunt, and Shenzhen-based Hotoday.
The popularity of smartphones has pushed the development of social and entertainment apps to new heights in India. Experts estimate that there will be 478 million Indian internet users by June 2018. Not only can Indian mobile users enjoy fast 4G networks, but they also have access to inexpensive mobile data.
According to a report published by BCG (The Boston Consulting Group) and CII (Confederation of Indian Industry), the size of the country’s M&E (media and entertainment) sector is expected to increase by 13-16% during the next eight years and should reach INR 380,000 to 500,000 crores (USD 560 to 740 billion) by 2025.
China’s players act as stabilizing forces in India’s content aggregation space. With advanced technology and large amounts of capital, China’s companies are looking away from the saturated Chinese market towards the promising Indian one.
“We will focus on only the Indian market because it is already a huge market with plenty of growth opportunities,” said Forrest Chen, co-founder of NewsDog.
NewsDog’s technical advantages
Facing severe competition, NewsDog stands out with its advanced technical capabilities and localized strategies for providing content in local languages. The startup’s machine learning capabilities provide personalized content for users according to their preferences. Users who read in Hindi make up of the largest proportion of active users, though many read news in regional Indian languages such as Tamil, Telugu and Marathi.
NewsDog provides a Medium-like self-publishing platform for users to create their own content, a highlight that its competitors do not offer. Content creators using NewsDog can unleash their creativity and get paid for their work, which keeps people using the site and guarantees the publication of original content. The startup puts particular focus on entertaining content, a different strategy that is already paying dividends.
The game between Tencent and Alibaba
This round of financing has enabled Tencent to penetrate India’s content aggregation space and to compete with Alibaba Group, which owns UC News, a leading player in Indian news aggregation. Early in February, Inc42 reported that Alibaba plans to purchase shares of Dailyhunt. However, this is not just a competition between China’s two Internet giants, but one that involves players from across the world, as Facebook has long dominated this market.
Alibaba and Tencent have been increasing their market shares in India’s O2O business, which is among the hottest and fastest developing sectors. While Tencent invested in Flipkart, one of the biggest O2O ecommerce companies, Alibaba financed Paytm, known as “India’s Alipay.”
With investors from China and other countries, the Indian tech and internet sectors are looking forward to a promising future.
(Top photo from AllTechAsia)