VMate raises ₹700 crores from Alibaba to tap into India’s short video space

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Jack Ma-founded Chinese conglomerate Alibaba is betting on Indian video market after it successfully penetrated the Indian payments, e-commerce and food tech market through its series of investment. Alibaba has invested ₹700 crores ($100 million) in VMate, a short video app launched by UCWeb, Alibaba’s subsidiary.

Launched in September 2016, VMate is a short video sharing app that allows users to stream a movie online or download it to watch later. Users can also share these movies. Over these years, UCWeb has introduced features to keep up with the market demand. At present, VMate has more than 30 million monthly active users all over the world.

The latest funding will help the app to establish itself as one of the most prominent players in the Indian short video industry. UCBrowser’s strength in India has been challenged by the comeback of Chrome. Alibaba has also picked up a minority stake video analytics startup Vidooly earlier to mark its presence in the video industry.

India is one of the largest mobile video markets in the world. Mobile app downloads in the country have witnessed a 165% growth in the last two years. According to App Annie, an average Indian user has 68 apps on their smartphone out of which 35 are used on a monthly basis. TikTok, owned by Bytedance, is the most popular shot video apps in India with more than 120 million users.

TikTok has been downloaded more than 240 million times in India. The app was also used in the recent elections to reach out to masses due to its rural penetration. This may be the reason why Alibaba is so keen on tapping into the short video segment in the country. Alibaba will study the Indian market and will apply special measures different from what it applies in China to efficiently tap into Indian users.

In March 2015, Alibaba acquired a 25% stake in Paytm’s parent One 97 Communications, and in August of the same year, led ₹3,500 crores fundraise into Snapdeal. In 2018, Alibaba invested ₹224 crore into XpressBees which had originally been the logistics arm of maternity retailer FirstCry.

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Divya Baral
Divya is the correspondent for the category "Funding News", "Funding Roundups" and author of "Fundraising Essentials". She has been writing for 10 years.

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