In a tumultuous year for ShareChat, during which two of the unicorn’s co-founders stepped down from their executive roles and the company logged losses amounting to Rs 5,144 crore, its top brass took home a cumulative remuneration of Rs 5.77 crore.
The company's chief financial officer, Manohar Charan, was the highest-paid among the top brass, drawing a total compensation of Rs 3.11 crore in FY23, up 13 percent from Rs 2.75 crore in FY22.
At the same time, chief executive officer and co-founder Ankush Sachdeva took home a pay of Rs 80 lakh in FY23. Sachdeva was the only key managerial personnel whose remuneration remained unchanged from the previous financial year.
Meanwhile, Sharechat co-founder Bhanu Pratap Singh’s remuneration jumped 25 percent from Rs 80 lakh in FY22 to Rs 1 crore in FY23. Another co-founder, Farid Ahsan, saw his pay package grow 14 percent from Rs 72 lakh in FY22 to Rs 82 lakh in FY23.
However, according to a company source, all the three co-founders had salaries of Rs 80 lakh per year in both FY 22 and FY 23.
"In fact, their pay has been the same since FY20. The difference in numbers you see is because of full and final, gratuity, leave encashment etc in FY23. Ankush has no change in his employment so his number is showing the same," the company source added.
Both Singh and Ahsan stepped down from their roles as chief technology officer and chief operating officer, respectively, of ShareChat earlier this year. Recently, the duo raised $3 million in funding for their robotics startup.
ShareChat, valued at $5 billion in its last funding round and backed by investors such as X (formerly Twitter), Google, Lightspeed, and Temasek, saw its revenue increase by 59 percent from Rs 347 crore in FY22 to Rs 553 crore in FY23, according to the company's annual financial report sourced from Tofler.
Meanwhile, the social media unicorn’s net losses shot up by 72 percent from Rs 2,989 crore in FY22 to Rs 5,144 crore in FY23 on the back of rising server rents, financing costs, foreign exchange losses, etc.
According to a company source, the headline loss number for FY23 is inflated because of multiple notional cost entries and one time expenses such as amortisation of goodwill from acquisitions (amounting to Rs 1,903 crore), forex losses on account of restatement of USD denominated debentures and accrual of interest on debentures. In reality, these debentures, along with all accrued interest will convert into equity shares later and, hence, none of these entries will materialise in actual cash outflow.
The source also added,"Rs 131 crore worth of ESOP cost is booked as part of employee cost but this is a non-cash item. The company has also taken a provision of around Rs 200 crore on their GST asset which appears as non cash, non operating cost in FY23 and will be written back as non-operating cost in future years."
Also read: Inside Sharechat’s crisis: absent founders, flurry of management exits, spiralling losses
In its annual financial filings, ShareChat reported that advertising revenue increased to Rs 255 crore in FY23, up from Rs 212 crore in FY22. Additionally, sales of the company's Chatroom service grew from Rs 120 crore in FY22 to Rs 285 crore in FY23.
Interestingly, Facebook and Google were the company’s biggest customers in the previous two financial years. Facebook accounted for Rs 25 crore in revenue in FY21 and Rs 27 crore in FY22, while Google contributed Rs 26 crore in FY21 and Rs 50 crore in FY22 to revenues.
However, Facebook — which is a competitor of Sharechat as its short video platform Moj jostles for audience eyeballs with the global tech giant’s Instagram — is not one of the biggest revenue drivers for Indian social media start-up anymore.
In FY23, Sharechat’s two biggest customers were Google and Shine Agency — both of which brought revenues of around Rs 58 crore.
The unicorn’s revenue from fantasy gaming platform Jeet 11 dropped from Rs 14 crore to Rs 12.5 crore during the period. In December last year, Sharechat had shut down Jeet 11 and laid off around 100 employees, according to reports.
On the expenses side, Sharechat’s spend on server rent rose 21 percent from Rs 845 crore in FY22 to Rs 1,022 crore in FY23, content development costs jumped 50 percent from Rs 422 crore to Rs 633 crore during the period, foreign exchange losses ballooned from Rs 55 crore to Rs 239 crore, and provisioning for doubtful assets grew from Rs 143 crore to Rs 199 crore.
The company also saw its financing costs rise almost four-folds from Rs 90 crore in FY22 to Rs 340 crore in FY23.
Even as the social media unicorn let go of around 700 employees last year, its employee benefits expenses rose 38 percent from Rs 505 crore in FY22 to Rs 698 crore in FY23. Of the total employee costs, share-based payment expenses accounted for Rs 74 crore in FY22 and Rs 103 crore in FY23.
Update: More context on founders' remuneration and losses were added to the story based on information received from company sources.
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