Xiaomi, Sequoia Capital India lead the latest funding round to Samosa Labs

MUMBAI: Social media and chat entertainment app Samosa Labs has raised $7 million (about Rs 48 crore) in its latest round of funding led by Chinese smartphone maker Xiaomi and Sequoia Capital India, according to multiple people aware of the matter.

Sequoia Capital first invested about $1.3 million in Samosa Labs’ seed round in 2015. For Xiaomi, this is the second investment in the content and social media space in India after it led an $18-million investment in regional language social platform Share-Chat in January.

With this, the total capital raised by Hyderabad-based Samosa Labs touches $9 million.

Founded in 2015, Samosa Labs is a chat entertainment platform that began with hosting user-generated audio and gifs which could be shared across other social media platforms like Facebook and WhatsApp. The firm launched video-based content in February this year.

Samosa Labs has an inline integration with WhatsApp and Facebook Messenger where a bulk of the videos generated on its platform is shared, with several brands and studios looking at the platform as a way to drive traffic and for digital marketing.

“About 98% of the traffic on Samosa Labs is driven through chat shares on WhatsApp. About 5,000 videos are created every day by users across genres of romance, comedy, devotion including elements from pop culture such as songs, movies, images, etc.,” chief executive Abhilash Inumella said.

Inumella declined to comment on the fund raise.

Xiaomi and Sequoia Capital did not respond to ET’s queries until the time of going to print.

The platform has seen great interest from movie studios which use the platform to create viral traffic ahead of movie releases as a way of targetted digital marketing. However only 1% of the video content on the platform which is typically under 60 seconds of duration is generated by studios.

Some of the most successful outcomes of the platform have been around the release of south Indian movies such as Kabali and Mahanadhi with Samosa being able to drive 2 million views on the app for the latter.

Like its peers in the content and social media space, Samosa Labs is yet to make revenues on any of its operations, however it has grown tremendously in traffic and user base capturing a dominant lead in the south Indian market, despite being the last entrant in the video space.

The platform saw its daily active users rise almost 10 fold in the last 6 months since it started video based content to 5,00,000 from the 50,000 users it had prior to launching videos.

Samosa Labs is also testing monetisation models around advertising revenues and brand building and is in the process of rolling these out soon, said Inumella.

The firm has already started piloting content in Northern India and is likely to scale aggressively generating focussed, area-specific content to get a foot in the door in these heavily contested markets in the next 3-4 months.