Media startup Dailyhunt is in advanced stages of talks to acquire the Bengaluru-headquartered social network Koo, two sources familiar with the matter told me.
The potential deal under discussion involves a share-swap agreement and could be finalized within weeks, the sources added, requesting anonymity as the matter is private.
The deliberation follows Koo, which has sought to become a Twitter rival, aggressively hunting for new capital throughout last year. The social network, available in India and Brazil, is betting on the idea that its approach of supporting multiple local languages will help the eponymous app resonate broadly with the larger masses.
Koo co-founder Mayank Bidawatka said in September that the startup — which has raised over $60 million from investors, including Tiger Global, Accel, 3One4 Capital, Mirae Asset and Blume — was looking to find a strategic partner with a “distribution strength” for its “next phase” of journey.
“From growing rapidly to cutting down on growth and proving unit economics, within 6 months of revenue experimentation, we took a 180 degree turn and proved that this is a real business,” he wrote.
Dailyhunt, which was last valued at $5 billion, and Koo declined to comment.
VerSe Innovation, the parent firm of Dailyhunt, reaches more than 300 million users in India through its news aggregator platform and short-video app Josh. It raised a funding round of $805 million in April 2022 from investors, including Canada Pension Plan Investment Board, Ontario Teachers’ Pension Plan Board, Sofina Group and Baillie Gifford.
Following the publication of this story, Koo’s Bidawatka wrote in a LinkedIn post:
Over the past few months, we have been talking to multiple partners who could help us achieve this.
Our responsibility towards a wider community of stakeholders (users, creators, VIPs, investors, policy makers, media) forces us to not share anything prematurely while we’d like to say more. Requesting your patience till we can share more concrete details of this partnership that will help Koo take wings in an organic manner and help challenge global competitors in a meaningful way.
Indian digital products are being made to international standards and it’s time to create global brands from India. As everyone knows, the startup ecosystem globally has witnessed a funding crunch without which Koo would have been on its way to rapid international market expansion.
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