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Hike

India's WhatsApp? WeChat? Snapchat?

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Hike, the messenger app, is India’s latest unicorn, valued at $1.4 billion after their latest round of funding in August ’16. The company, which began operations in 2011, currently boasts a registered user base of 100 million, making it the second largest messenger app after WhatsApp in India.

Hike

Hike Ltd

Name as per MCA records

Kevin Bharti Mittal

CEO

Delhi NCR

Headquarters

Investors

Softbank

Tencent

Bharti Softbank

Competitors

WhatsApp

WeChat

Snapchat

What has Hike been up to, the last year?

It’s been a rather eventful year. In January, Hike announced that it had crossed the 100 million registered users mark. But one that needs to be tempered with a generous pinch of scepticism in that the company hasn’t released its monthly active users metric which is a more meaningful way to track user engagement for a messaging app. For instance, WhatsApp recently announced that it had 160 million monthly active users in India, making the country the biggest market for the Facebook-owned entity. Competing with a behemoth like WhatsApp which is almost omnipresent in India is indeed a formidable challenge for any startup but it is a battle worth fighting. According to a recent report by eMarketer, India is the second-largest market for messaging apps and is the fastest growing market for mobile messaging apps globally, with the chat app user base expected to grow by more than 24% this year and top 133 million.

Aided by a marquee set of global investors who aren’t chary of opening their purse strings and the formidable bulwark of India’s largest telco in its corner, Hike seems to be making the right moves to take on WhatsApp. Rather than fight head-on, Hike has been targeting millennials by pushing features such as India-specific stickers and animations (borrowing a leaf from WeChat) and more granular privacy controls (“chat without letting your parents or other busybodies know”).

In keeping with this hip, edgy brand positioning, Hike moved to a swanky new office in Aerocity, New Delhi last year – a place Hike executives refer to as the ‘Temple of Excellence’. Following its latest round, Hike seeks to build a messenger-driven service ecosystem (also known as the Swiss Army knife) on the lines of Tencent’s WeChat and Facebook’s Messenger app. It also recently released a product makeover bringing in features “borrowed” from Snapchat – stories and live filters. Presumably, somewhere within this motley mix of WhatsApp, WeChat and Snapchat, lies Hike’s eventual destiny.

Results:

Rs 42.3 lakh – Hike has never made money from operations. That, however, changed this year. It earned Rs 42.3 lakh from operations as of March 2016  — income from gaming and coupons. The discount coupons it introduced in November ‘15 (around Diwali) turned out to somewhat of a hit, taking in Rs 42.2 lakh. It is moot whether this is a good or bad thing as future prospective investors might now demand to see performance rather than promise/potential.

Rs 217 crore – Hike’s losses as of March 2016, up from Rs 122.3 crore in the previous year.

Rs 129.9 croreThe amount Hike spent on marketing as of March 2016. The company’s marketing spend is nearly twice as what it did in the previous year, Rs 66.7 crore. 

Rs 18.2 crore – Hike Managing Director and CEO Kavin Bharti Mittal’s annual remuneration as of March 2016. *

16 – Number of Hike employees who earned an annual salary of more than Rs 1 crore. Think about it like this. Even if Hike’s operating revenue grows 100X, from Rs 42 lakhs today, it will not be enough to cover the salaries of the number of people drawing more than Rs 1 crore per annum at Hike. 

Rs 94.6 crore – Accumulated losses (as of March 2016) of two companies – Mobinteco Ltd and Y2CF Digital Media Limited. Both were merged into Hike earlier this year

Rs 34 crore – This is the profit the company earned from sale of investment as of March 2016. This income has been shown as part of total revenue. 

Rs 1.93 crore – The cost incurred by Hike for SMS and Activation. Also, related party transaction between Hike and Bharti Airtel.

 

* Correction: This copy has been changed at 5:30 PM on 2 December to correct an error. The copy earlier stated that Anuj Jain is the second highest paid executive at Hike with a salary of Rs 10 crore. That is incorrect. Anuj Jain’s remuneration is Rs 1 crore. The error is regretted.

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