Tencent’s WeChat may be the golden standard for messaging apps in China, but in India, WhatsApp owned by Facebook is by far the most dominant player with an 85-90% share of the market, according to estimates from technology market intelligence firm IDC.
Tencent’s Grace Yin, Director of WeChat Pay, said the company is only concerned about servicing homegrown users in China and Chinese expats at the moment. “Tencent focuses on outbound [Chinese] tourists, helping them eliminate the need to exchange hard currency. Travel demand is so strong right now, we hope to extend the services and payment methods Chinese users are used to when they go abroad.”
But, that doesn’t mean Tencent has no ambitions for the world’s second largest smartphone market.
Last year, the internet giant led a $175 million investment in Hike, a five-year-old messaging app founded by Kavin Bharti Mittal. Hike is the only other significant player in a very fragmented Indian messenger space, according to IDC.
The 29-year-old India native was educated as a software engineer in the UK. He interned with Google, Formula 1 racecar manufacturer McLaren Automotive and lastly in the debt capital markets division of Goldman Sachs. He quickly learned life as a banker wasn’t for him, “I don’t want to wake up everyday building [financial] models,” said Mittal.
I sat down with Kavin, who was in Hong Kong for the RISE 2017 tech conference, to get to know the man behind Hike.
Dressed casually in a crisp white shirt, linen shorts and a pair of TOMS, Kavin ordered a Japanese tea and explained he was just off the plane from Japan, where he spent two days immersed in Zen Buddhist teachings at a traditional ryokan in the mountains of Kyoto.
He started following the practice right around the time he launched his company. “I feel like I was a Japanese monk in my past life. I’m so inspired by Zen culture, looking at life the way it is and not the way it’s supposed to be.” He goes on, “it’s had the most profound impact on my life, teaching me a deep understanding of self-awareness.”
Mittal is the son of an entrepreneur. His father Sunil Mittal, is the founder and chairman of Bharti Airtel, India’s largest telecom company, and the wealthiest man in the country. When asked about his famous family, he declined to comment. Instead, he wanted to talk about the iPhone 4, which was his motivation for building Hike.
In 2012, Mittal was part of the fortunate minority in India to own a smartphone. Most Indians at the time used bulky Nokia dumbphones without an internet connection. Anticipating an explosion in smartphone adoption over the coming years, Mittal built Hike. In just four years his messaging app has seen hockey-stick like growth and today has over 100 million registered users around the world .
Much of Hike’s success can be credited to Millennials. One of the most talked about features offered by the app is sticker packs, which allow young people to express themselves. But, the fun, colorful images also serve a deeper, cultural purpose. Hindi comes in many forms and local languages are difficult to type on handsets without a standard keyboard. Images eliminate the need to type. Further, many stickers are developed specifically for the country’s numerous festival celebrations, making them highly-relevant throughout the year.
According to Hike’s research, 50% of devices in a typical Indian household are shared and young people were wary of their privacy, so the product team created a hidden mode to make certain chats invisible.
The app has been quick to adapt to user’s needs. Just last month, Hike launched the first in-app mobile payment feature, beating all other messenger services, including WhatsApp to the punch. Utilizing his cultural connection, Mittal noted that money is exchanged at almost every big festival in the country. “We bring that festival behavior online in a very social way with blue packets,” he said. The market’s reaction to the digital blue packets is similar to that of WeChat’s digital red packets in China. In other words, very positive.
With Tencent now a major financial backer, it seems the Chinese company is happy to allow Hike to take the lead in the local market. “Users of WeChat are Chinese expats in India, they [Tencent] don’t proactively push the product here,” Mittal reassures. And, indeed, WeChat has not been customized for the Indian market.
Hans Tung, Managing Partner of GGV Capital thinks WeChat is an amazing product for a mature and sophisticated market and points out India is simply not there yet. Millennials in China have spent a decade getting to know the internet. “ In India, of course mobile first will be an advantage, but they’ve only been mobile first for three years, that’s not long enough ,” said Tung. “You need another two years for users to spend time on 3G, 4G and play on a lot of apps to know what to ask for.”
A seasoned venture capitalist, Tung believes Tencent would happily increase their stake in Hike without being intrusive. “Tencent is more like hey, the reason why we’re profitable is we let you, be you, that’s their style,” Tung says. He claims Tencent knows being local is not their core competency.
For his part, Mittal has high ambitions for the company, “Hike has become that platform app for India. Honestly, we’re just getting started.”
More Info: www.forbes.com