Abu Dhabi sovereign wealth fund ADIA is in talks to back Pocket FM with a major new funding round as the Indian audio storytelling platform expands deeper into the US, two people familiar with the matter said. a source told TechCrunch.
Talks on the new round have been going on for more than a month and follow Pocket FM's recent securing of about $100 million in another funding round from Lightspeed Venture Partners, the people said, adding further details. The person requested anonymity because it has not yet been published.
TechCrunch reported last year that Lightspeed Venture Partners was working on investing in Pocket FM. There were no previous reports about the Bengaluru-based startup's negotiations with ADI or the closing of the recent round.
The funding consideration follows rapid revenue growth for the Indian startup, which offers serialized novels and nonfiction content across genres such as romance, self-help, and motivation. TechCrunch previously reported that the company's annual revenue run rate through the end of last year was more than $160 million, an increase of six to seven times compared to a year ago.
ADIA did not immediately respond to a request for comment, while Pocket FM said it does not comment on market speculation.
Pocket FM (which also counts Tencent, Tanglin and Times Internet among its backers) had publicly set a goal of reaching $100 million in ARR by the end of 2023.
Image credit: Bain
Indian startups have struggled in the last year as prominent crossover funds such as Tiger Global and SoftBank cut back on investments in India and other markets, while many prominent India-focused funds focused on early support. Large funding rounds have decreased significantly. Bain said this week that the company is in the startup stage.
Several sovereign wealth funds, including ADIA, Temasek, GIC and Qatar Investment Authority, accelerated their investment pace last year, reducing the size of large checks to late-stage startups such as PhonePe, Lenskart and Pharmeasy. .
Pocket FM's expansion into the United States and offering customers a non-subscription, pay-as-you-go service has been particularly successful. Pocket FM operates on a freemium model, leveraging long-form, episodic storytelling to give users the option to pay only for the content they prefer, rather than the entire library.
This approach has allowed the startup to offer free access to episodes every 24 hours, but charges a fee for additional content. Since early 2022, the platform has adopted a microtransaction model, allowing users to purchase coins with local currency and redeem them for episodes beyond their free quota. TechCrunch previously reported that listeners spend an average of more than 110 minutes on the platform each day.
Last month, the company announced it would invest $40 million to grow its online reading platform Pocket Novel. Pocket FM co-founder Rohan Nayak wrote on LinkedIn this week.