Why Indian Social Media Companies Failed?

00:00 - Intro
01:31 - History of Social Media

03:55 - Struggles of Indian Startups
07:03 - Learnings for Entrepreneurs

The video discusses the failure of Indian social media platforms and explores the challenges they faced. It begins by highlighting the dominance of global social media platforms and the significant Indian user base on these platforms. Despite India having the world's largest population and second-largest online population, there is a notable absence of successful Indian social media platforms.

The narrator attributes this gap to historical factors. During the first wave of social media in the early 2000s, when platforms like Facebook, Twitter, WhatsApp, and Instagram emerged, India lacked a conducive startup ecosystem and had limited internet penetration. The absence of talent and investment opportunities led Indian entrepreneurs to build such platforms in the United States. Consequently, India missed capitalizing on the initial wave of social media.

The second wave of social media, driven by the rise of TikTok in 2016, originated in China rather than the United States. TikTok's unprecedented growth in China and subsequently in India created an opportunity for Indian entrepreneurs to fill the void left by its ban. By 2020, India had become the world's third-largest startup ecosystem, with a substantial internet user base.

The video then delves into the reasons behind the failure of Indian social media startups. After the ban on TikTok, several Indian entrepreneurs rushed to develop their versions of short video apps. However, these apps, such as Sharechat's Moj, failed to innovate beyond being TikTok clones. The lack of a sophisticated AI recommendation engine like TikTok's, which provided personalized content and identified viral trends, resulted in low user engagement.

Moreover, the video highlights the monetization challenges faced by these platforms. Due to poor technology and user experience, users resorted to using multiple apps simultaneously, making it difficult for platforms to retain users. This lack of user trust also deterred brands from investing in advertising on these platforms. The video cites Mohalla Tech, the company behind Sharechat and Moj, which reported significant losses despite having a large user base.

As a response to these challenges, some platforms shut down, while others pivoted to different business models. For example, Chingari turned to adult content and became one of the highest-grossing apps on Google's Play Store. Mitron shifted its focus to video editing. However, the overall trend was a decline in user engagement, with many users and creators migrating to Instagram Reels and YouTube Shorts, which offered better user experiences and tools for content creation.

In the concluding section, the video provides key lessons for future entrepreneurs. The first lesson emphasizes the importance of innovation, highlighting how Indian social media platforms failed to differentiate themselves and lacked a unique value proposition. The second lesson underscores the need for a sustainable business model, cautioning against overreliance on venture capital without a clear strategy for long-term profitability. The video cites the example of Sharechat, which, despite raising substantial funds, faces financial challenges and has a limited runway.

In summary, the video explores the historical context, challenges, and reasons behind the failure of Indian social media platforms. It offers valuable insights for aspiring entrepreneurs, emphasizing the importance of innovation and sustainable business practices in the competitive social media landscape.

#startup #business #entrepreneur

[backstagewithmillionaires]

In your opinion, what else is the reason for failure of apps like Sharechat, Moj and Josh?

[Mr.Coffee]

In my opinion, building a social media app isnt about copying existing trends but looking at future trends. I remember back in the day, every social media company was like "we want to build the next Facebook", yet no one thought the answer to that was a short form video app. Instead they copied Facebook thinking it would work.
So the answer to building the next Social media app isnt a short form video app. Perhaps the answer is in VR or Metaverse or whatever the next trend is.

[shuvampargal]

I can still say that hike was much much better and was advanced than whatsapp at that time. It just they not able to market it properly among old and mid aged people

[prakash]

- Network effects : This is most underrated aspect which the apps failed to create among mixed user segments in India (confined to limited segments which aren’t revenue generating)
- Quality content (the algorithms are shuffled to focus on entertainment rather than insightful, users lack inspiration without authenticity in the content)
- Brand building (When a user thinks of any foreign developed social media apps, the notion is different as opposed to desi apps. Strictly talking about social media)

[tamanna]

Majority of us in tier1 cities find these short video platforms very 'cringe' and cause tier 1 netizens spend the most on online ads, they were unable to capitalize on us. Social status also plays a huge role.

[rohitk]

Monetisation is the biggest problem. Indian spending power is very less compared to us and china, so these apps not able to make money even after having so many users

[pawanraj]

Simple answer :- We don't have soft power and economy power. When these will grow, it'll happen

[lakshparekh]

One of the reasons also being how tier 1 and tier 2 city residents want to adapt whatever what the westerners are doing, although there are exceptions but still people feel a better sense of status among others

[anshulsingh]

Let me tell you a story. I’m a social media founder and this video is gold for me.
I just realised what legendary shit I just pulled off. I have been passionately involved in building an innovative social platform for like last 2-3 years and was not aware of the all these cases. Although I knew the names of these companies but never took interest since I hate copying others.

My motivation was a statement by Steve Wozniak who said Indians are not creative. That fired me up and that fire is still burning like lava.

It’s been infinite nights of coding and brainstorming. I am sure we would be able to pull it and put an Indian social network on a global level.

Love you.

[Thenaveensanthosh]

social media is inherently global. the biggest reason a lot of indian companies failed and will continue to fail is because they want to build social media for indians. build for the global audience, indians will be there too.

[JAT_]

Main reason hai ki Indians fully original apps ya websites nhi bna rhe

Jaise Flipkart amazon ki copy h
Moj etc. Tiktok ki copy h

Koi bhi 100% orignal and diffrent cheez nhi bna rhe h

[Nitesh_Bhagat]

to sum it up in one line:
BUILD SOMETHING PEOPLE LOVE, NOT LIKE

[krnkbabu]

Still. Why did hike fail?
With all AI Natasha and sticker chats, Hike in 2017 is still far far better than WhatsApp in 2024 or wechat for that matter

[namanydv_garud]

Great insights, bro. Innovation and sustainabile business model are a must eventually.

[bhumit]

bro in my opinion no one can build social media companies as popular as you shown in intro because people do not wish to leave existing ones because they might migrate to those new apps but what about the content creators who uses existing apps, they are not gonna migrate so there is no content, so people will eventually go back to exiting apps

and apps like sharechat and Moj are heavily used by people of tier2 to tier3 or elder people and no new generation would like to use these apps because of content they have.

[saw]

The problem with Indian apps isn’t building the apps but using the data to help advertisers to get optimal customers. FB isn’t a Social media company but an advertising agency that runs a social media to find customers for Advertisers. Data mining should be the top priority of any social media company.

[saloni]

In my opinion, there's a lack of proper utilisation of human resources in India.
Because certainly we have largest population in the world, largest youth in terms of numbers. But yet we're unable to utilise the human capabilities. For eg India has one of the highest numbers of engineers graduating every year in the world.
But on the other hand this situations can be reversed and can be used as an opportunity to solve a new problem.

[magicofletters]

Indian users want to earn... doesn't want to buy..they want to earn with anyhow

[arjuntyagi]

We have quantity of population, not quality of population

[J.A.S.S.]

Best part is that at the end these companies had to be creative and bring something new on the table