Pocket FM Secures $103M Funding for Global Expansion

Pocket FM, an Indian audio platform, has raised $103 million in Series D funding, aiming to expand into the American market and later into Europe.

Pocket FM, an audio platform located in India, has raised $103 million in Series D funding, with participation from Stepstone Group and headed by Lightspeed Ventures. Once the firm succeeds in the American market, it plans to expand into Europe and Latin America. Tencent and Times Internet are among the company’s supporters.

Reporters have discovered exclusively that the company has raised $196 million in a series of funding rounds, valuing it at $750 million.

The media speculated last year that Lightspeed was in talks to lead the investment round that the business revealed today.

What is the platform’s functionality?

Pocket FM aspires to become the “Netflix for audio” worldwide by offering audio programs with multiple short episodes. Some episodes and series are available to listen to for free, while others can be unlocked with coins. Pocket FM has determined that the pay-as-you-go model is more appropriate for the company than embracing a subscription-based approach that would allow users access to all programming.

Customers are not tied to an ongoing subscription plan. However, similar to purchasing in-game things to level up, users must pay coins to access more material.

Pocket Novel, the company’s writing platform similar to Wattpad, will receive $40 million in investment, according to an announcement last month. Rohan Nayak, co-founder of the startup, announced last week on LinkedIn that the platform has had over 90,000 contributors since February 20. Another way Pocket Novel tries to get you to pay coins is so you can unlock content.

Although both applications offer a way to purchase coins to access content, they are incompatible. So, you can’t use your Pocket Novel product codes to unlock material on Pocket FM, and vice versa.

Like LikePocket FM, it competes with similar pay-to-unlock strategies in its limited audiobook niche. Only in India, through preexisting agreements, is this product being offered by the corporation.

Mathematical Challenge

Generally speaking, Pocket FM is designed to encourage consumers to spend more time on the site. With over 400,000 episodes spanning various genres and languages, the audio platform has over 100,000 hours of material.

Much of the company’s 2021 revenue came from its growth in the United States. The U.S. contributed $100 million to Pocket FM’s ARR, which brought the total to over $150 million for the year. While it does have a presence in other markets, the United States and India rank highly among the company’s most important markets.

The platform’s American user base has likewise been quite active. In contrast to the 115 minutes users spend worldwide, the average American consumes 135 minutes on the audio platform.

Over 250,000 authors have signed up for the Pocket Novel platform, which faces competition from local options like Pratilipi, funded by the Omidyar Network.

Generation AI initiatives and the Maker Movement

So, it should come as no surprise that Pocket FM is eager to test out AI-generated features. A program that allows American writers to turn their works into audiobooks has already begun testing. In a partnership with Eleven Labs, the business offers authors 50 different voices driven by artificial intelligence.

Startup officials have revealed they are working hard on artificial intelligence (AI) tools to speed up the story-writing process.

Pocket Novel offers writers a revenue-sharing scheme and rewards them for reaching their writing goals. There is much average content on the marketplace since AI algorithms often produce inconsistent or low-quality results.

Rahul Nayak, CEO of Pocket FM, stated to the media that a platform’s primary responsibility is eliminating irrelevant content.

Before making high-quality content available to listeners, you must filter out the noise. In our view, artificial intelligence is mostly about facilitating efficiency and productivity benefits for authors and creators, he added.

Pocket FM claims that some authors make over $3,000 monthly, but it does not disclose the average wage. Although the startup denied ever enforcing an exclusive clause on authors, it did claim to have agreements to possess intellectual property.

Objectives for future growth and investment

In a separate development, the firm has begun courting potential backers for its next round of funding. According to reports last week, Pocket FM and Abu Dhabi’s sovereign wealth fund, ADIA, have been discussing a possible big fundraising round.

Even though it has received a lot of interest from investors, the firm chose not to comment on that specific development.

You’ll generally notice a surge in investor interest as you scale. According to Nayak, the next round’s status is contingent upon realizing specific goals and the details of their scaling strategy.

In addition, Nayak said that while the business is not currently making a profit, it is concentrating on expanding and has a high gross margin. The firm employs about 800 individuals and has global expansion plans to recruit 500 more.