Hike pivots to multi-app approach in bid to boost growth
Hike, the country’s smallest unicorn in terms of revenues, has decided to pivot to a multi-app approach in its latest strategic shake-up.
The messaging platform’s founder and chief executive officer Kavin Bharti Mittal announced on Thursday that Hike would launch separate apps for messaging/social media and content this year in a shift from its single-app-for-all blueprint so far.
“In 2019, we continue to double down on both social and content but we’re going to do it with an evolved approach. We’re going to do it across multiple apps,” said Mittal.
He added that this would help the the company solve one issue well on each app.
“This is going to allow us to explore different parts of the market which is important given a significant number of new internet users have come from an older age demographic previously un-targeted by Hike,” Mittal said.
The move is Hike's latest in a long line of experiments. Since launching as a messaging service in 2012, it has tried multiple things including being a multilingual platform, launching a wallet in 2017 and tie-ups with cab, bus, train booking platforms and ticketing for additional revenues. It also launched a refined version of Android called Total that was aimed at providing a basic web experience.
Along the way, it also acquired social networking app Pulse and Creo, the maker of HDMI media streaming device Teewe.
But this diversification appeared to take its toll. Eight months ago, Hike laid off several of its 350-plus employees and shut its Bengaluru operations. At the time, Mittal said the moves were part of efforts to focus on its core offering of a messaging platform.
The app, which pitches privacy as a key selling point, claims to have around 150 million users on its platform, compared to main competitor WhatsApp’s 200-million strong India base at last count.
On the content side, it competes with homegrown platforms such as ShareChat and DailyHunt, among others.
The company has not raised funding in nearly three years. Hike had touched a valuation of $1.4 billion in August 2016 when it raised $175 million (Rs 1,170 crore then) from China’s Tencent Holdings Ltd, Taiwan’s Foxconn Technology Group and other investors. In all, it has raised around $250 million with Japanese investment giant SoftBank and hedge fund Tiger Global among its other backers.
Its financial health has also been a concern as Hike continues to bleed, losing Rs 1 crore every day in the financial year 2017-18.
Hike posted net losses of Rs 399.6 crore in 2017-18 as compared to Rs 212.7 crore in the previous fiscal.
After generating zero revenue from operations for the financial year ended March 2017, it earned Rs 50.9 lakh in operational revenue in 2017-18. Hike does not charge consumers nor does it support advertising.
Hike’s net expenditure also rose significantly, increasing to Rs 439.9 crore in 2017-18 from Rs 245.67 crore in the year before that.