Indian Social Media Platform Koo Secures $30 Million Funding

Investment is flowing into Koo, an India-based social network positioned as an alternative to Twitter, coinciding with escalating tensions between the American platform and the Indian government.

Funding Details and Valuation

On Wednesday, the Indian startup announced a $30 million financing round spearheaded by Tiger Global Management. Participation also came from Mirae Asset, IIFL’s venture capital fund, and existing investors including 3one4 Capital, Blume Ventures, and Accel.

This funding has propelled the Bangalore-based startup’s valuation to exceed $100 million, a significant increase from its approximately $25 million valuation in February.

Koo's Functionality and Similarities to Twitter

Functionally, the Koo app mirrors Twitter, enabling users to share posts in both English and multiple Indian languages. Notably, its user interface, logo design, and social sharing features bear a strong resemblance to those of Twitter.

Growing Popularity Amidst Government Disputes

The app has experienced a surge in popularity within India in recent months. This growth follows disagreements between Twitter and the Indian government, stemming from Twitter’s initial reluctance to block accounts critical of New Delhi and Prime Minister Narendra Modi earlier in the year.

Recent disputes include requests to remove posts identifying a new coronavirus variant as the “Indian variant,” and objections to Twitter’s labeling of tweets from Indian politicians as “manipulated media.” Police in Delhi recently visited Twitter offices to deliver a formal notice.

Government and Celebrity Adoption

A number of high-ranking government officials, including Commerce Minister Piyush Goyal, Information and Broadcasting Minister Prakash Javadekar, Union Cabinet Minister Smriti Irani, and Electronics and IT Minister Ravi Shankar Prasad, have joined Koo.

Furthermore, many prominent figures in the Indian entertainment industry have also adopted the platform and encouraged their followers to do the same.

User Base and Growth Potential

Despite investor confidence, Koo is still in the early stages of user acquisition. Data from App Annie, shared with TechCrunch by an industry source, indicates the app had fewer than 6.5 million monthly active users in India as of April.

The startup’s stated goal is to establish a social network that caters to the entire Indian population, rather than being limited to urban users, where Twitter currently maintains a strong presence.

Future Plans and Vision

“We have aggressive plans to grow into one of the world’s largest social media platforms in the next few years. Every Indian is cheering for us to get there soon,” stated Aprameya Radhakrishna, co-founder of Koo.

Compliance with New IT Rules

Koo has gained traction, in part, due to its compliance with India’s recently implemented IT rules. These rules grant New Delhi increased authority to remove content deemed objectionable.

These revised IT rules, announced in February, aim to eliminate “double standards” by holding platforms accountable to local laws. Non-compliance could result in the loss of safe harbor protections for social networks.

Industry Response to IT Rules

The deadline for compliance with the new rules was Wednesday. Facebook, identifying India as its largest market, has expressed its intention to comply, while Google stated it “respects” India’s legislative process.

Tiger Global's Investment Strategy

Koo represents the latest investment by Tiger Global in the Indian market this year. The hedge fund, having already invested in over 20 Indian unicorns, has become a highly active investor in Indian startups.

Founders are attracted by Tiger Global’s rapid investment pace, substantial check sizes, and favorable investment terms.