NEWSDOG IN FUNDING TALKS WITH TENCENT

News and entertainment content aggregator NewsDog is in talks to raise $35-40 million from Tencent Corp. and others as start-up investors look for content providers that can attract a large user base online, three people familiar with the matter said.

Tencent, which has invested in Flipkart, Ola, Practo and a few other internet firms, wants to invest in a content start-up and has identified NewsDog as an attractive bet, the three people cited above said. Mint couldn’t ascertain the identity of the other investors talking to NewsDog.

Both NewsDog and Tencent declined to comment.

If the investment goes through, it will be the one of the largest start-up deals in the news and entertainment content business.

Investments in content startups are picking up pace, as venture capital (VC) firms bet that many Indian internet users will want alternatives to existing platforms like YouTube, Facebook and others and that after reaching a large number of users, start-ups can then attract substantial advertising revenues. Separately, companies such as Amazon, Netflix and Hotstar are pouring hundreds of crores of rupees to expand their content collections.

Still, the proposed NewsDog investment is relatively outsized given that within the content business, news is seen as the least lucrative model.

NewsDog, owned by Hong Kong-based Hacker Interstellar, was launched in early 2016 by Chen Yukun, a Chinese entrepreneur, and Yi Ma, an ex-employee at Chinese search firm Baidu. While it was launched less than two years ago, NewsDog has quickly become one of India’s three top news and entertainment apps, along with UC News, which is owned by Tencent-rival Alibaba Group, and local start-up DailyHunt.