ShareChat's Moj, MX TakaTak to merge, will have over 300 million users

ShareChat's Moj, MX TakaTak reached a deal to buy out and merge Times Internet-owned MX Takatak, triggering consolidation in short video amid competition with larger rivals such as Instagram Reels.

Together, they will have over 300 million users, and 100 million creator community. Post this transaction, MX Media and its shareholders will become strategic shareholders of ShareChat.

MX TakaTak will continue to function as a separate platform for now, but the two platforms’ creator base, content supply and recommendation algorithms will be integrated, the companies said in a joint statement.

While the companies did not disclose the value of the deal, Moneycontrol earlier reported that the deal is worth $600-million, a combination of cash and stock, according to sources familiar with the development. Sources also added that the value of the deal might change towards the closure of the deal.

Mohalla tech has over 2000 employees, and with the acquisition, 180 employees of MX TakaTak will join the firm. MX TakaTak will be rebranded in roughly six months and the target for the closure of the deal was end of the month, sources added.

The move is expected to strengthen ShareChat’s short video play through the platform, Moj. With the acquisition, Moj (160 million monthly active users (MAUs)), and MX TakaTak (150 million MAUs), together will have a combined active user base of over 300 million. Its local competitor Josh has over 130 million MAUs.

Ankush Sachdeva, CEO and Cofounder, ShareChat & Moj, said in the statement, “We at ShareChat are building India’s largest content ecosystem which has been on an unprecedented growth trajectory. MX TakaTak is a popular platform and this merger further solidifies our position in the short video ecosystem. With this development, we aim to build the largest original content platform on Moj along with the largest community of users across India.”

Commenting on the partnership, Karan Bedi, CEO MX Media said in the statement that MX TakaTak, with Moj’s AI and execution capabilities makes the combined business a truly world class short video platform. "MX has created two ‘unicorns’ within one business, unlocking significant value for our shareholders, and will now continue to double down on OTT, with significantly increased financial resources," he added.

This acquisition comes at a time when the short-video industry is gaining traction with Instagram’s Reels leading the pack. According to a RedSeer report, while Facebook's short videos and Instagram's Reels continue to dominate in the top 50 cities, its Indian counterparts like DailyHunt’s Josh, Moj, and MX TakaTak have a significant user base in the tier-2 and tier-3 cities.

Home grown short video platforms became popular after the Indian government banned TikTok in June 2020. While Moj was launched around the time of the ban, MX TakaTak was launched in July 2020 and Josh in September 2020.

ShareChat parent Mohalla-tech had raised a total funding of $913 million in 2021 on the back of the strong growth its platform Moj witnessed since the TikTok ban in June 2020. In the earlier rounds, it raised $145 million in July, and $502 million in April, led by Tiger, Snapchat and Twitter.

So far the company has raised $1.177 billion across eight fundraising rounds. ShareChat and Moj have a user base of 340 million. According to sources, the company has an annualised revenue of $35 million.

Founded in 2015 by three IIT Kanpur alumni- Sachdeva, Farid Ahsan and Bhanu Singh, ShareChat was one of the early players in regional language content.

What is in it for ShareChat?

A company executive, who did not want to be named, said, the userbase, the pace at which we are able to make that progress and the network effect that come through is faster with acquisition of MX TakaTak.

However, others pointed out that apart from the consolidation of userbase, there is nothing much ShareChat can gain.

An industry executive, on the condition of anonymity, pointed out that ad model in India is broken and the industry is struggling to monetise, even as Meta-owned Instagram Reels is winning in the short-video space. In that case, the source said, it does not make sense to buy another firm that is similar to what you are doing.