Hike gets fresh $65M funding to take on WhatsApp in India

Free messaging app Hike, the Indian answer to WhatsApp, Line, and WeChat, has just raised its largest round of funding: US$65 million led by Tiger Global Management. Bharti SoftBank (BSB), a joint venture of Bharti Enterprises and Japan’s Softbank Corporation, also participated in the latest round. Earlier, Hike had raised US$7 million in 2013, and another US$14 million in April 2014 from BSB.

Another piece of good news for the startup is that over the last two months, Hike almost doubled its user base, adding 15 million users to hit 35 million users today. About 50 percent of them are active users. This makes it one of the fastest growing instant messengers in India.

Kavin Bharti Mittal, founder and CEO of Hike told Tech in Asia that with the fresh infusion of funds, the startup aims to double the number of India-specific features in the app, and focus on solving more local problems in the market.

In India, over 95 percent of the mobile market are pre-paid users. Though there is an influx of smartphones now, internet coverage is still poor in many parts of the country. Most of the mobile internet users, who are buying data plans in megabytes and gigabytes, do not understand how internet usage works. Mital cites an example: “One minute or one SMS is tangible. But one MB on Hike and one MB on YouTube are very different, and intangible.” He added:

There are a billion people in this country who will come onto the internet for the first time in their lives and that too on a low-end smartphone. We haven’t seen this large of a mobile-first scale anywhere globally. As a result, there is a fundamental lack of understanding as to what the internet is for most people in the country. We believe that through messaging, we solve this problem.

To cater to this segment, Hike already has an offline option, which converts messages into SMS for those who are not connected to the internet, either temporarily or because they use feature phones that are not internet-enabled. The SMS reply gets converted back into a Hike message, and so the chat can carry on seamlessly even if one party is offline. It also has push-to-talk voice messaging for those who don’t want to type.

Lack of privacy is another country-specific issue that Hike attempted to tackle with a “hidden mode” feature that protects private chats with a password. “In a country like India, where teenagers stay with their parents and families, where their need for privacy is constantly challenged, we believe this feature could be a boon,” Mittal told Tech in Asia.

See: Hike grabs no. 1 spot from WhatsApp on Google Play, iOS App Store in India

The latest round of funding gives Hike enough ammunition to come up with more such innovations, expand further, and take on WhatsApp, still the most popular messaging app in India. In April, it had announced crossing 50 million monthly active users. That has climbed to over 60 million now, adding 3 million active users a month.

Currently, Hike is available globally on iOS, Android, Windows Phone, Blackberry, BB10, Nokia S40, and Nokia S60 It handles over 10 billion messages and three billion stickers per month. “We have a great shot at becoming the first mobile-Internet company [from] India to cross a 100 million users,” he said. Lee Fixel, Partner at Tiger Global Management, will be joining Hike’s board.