Can Tencent help Hike overthrow Whatsapp in India?

Written by James Parker || August 24 2016

Indian messaging app Hike raised $175 million in funding from global investors this month. This round of funding valued the messaging app at $1.4 billion, cementing Hike's entry into India's coveted "tech unicorn" club. Even so, it was one of Hike's new shareholders that lifted more eyebrows. Tencent, the owner of WeChat and China's most popular messaging app, were among the investors throwing their bets behind Hike. Kapronasia takes a look at possible advantages of this new relationship. 

Hike, India's second-most popular messaging app (behind Whatsapp) has been growing substantially since its launch in December 2012. Hike, whose users send as many as 40 billion messages through the platform each month, is focused on the younger generation. Ninety percent of its users fall within 15 to 24 years old. Hike’s founder Kavin Bharti Mittal seeks to use features such as news, shopping coupons, stickers and gaming to differentiate Hike from regular messaging apps such as Whatsapp. In an interview with Tech in Asia, Kavin said he envisioned Hike as a platform for users in India to not only connect with their friends, but also buy everything from Zara jeans to a McDonald's burger. 

Given Hike's expansion goals, closer ties with Chinese internet giant Tencent can go a long way. Sharing technology and best practices may allow Hike to replicate WeChat’s integration of e-commerce, food delivery, taxi, transport along with other value-added features. 

Tencent’s President Martin Lau also acknowledged this synergy, stating that Hike “is on a mission synergistic to ours, which is to enhance the quality of human life through internet services. With our investment, Hike will be able to leverage our deep domain expertise in the messaging platform space to provide more value to its users in India.” 

More importantly, Mittal has stated that Hike is likely to introduce a payment solution in the next six to twelve months. With Tencent’s investment and possibly their expertise, it is hoped that Hike’s payment solution can replicate the success of WeChat’s. More than 200 million WeChat users have their bank cards linked to the application and this year, 30% of the Chinese diners at McDonald’s were paying via WeChat. These numbers continue to grow. Should Hike be able to duplicate WeChat's success - not a tall order given that a messaging platform is an excellent way of attracting users - Hike would become one of the leading payments services in India, especially amongst the young.

And the knowledge transfer isn't just one-way. Hike has successfully pioneered a way of sharing messages and files between users without the need for an internet connection. This feature could prove potentially useful for WeChat as well, especially in the more rural or less developed areas of China, where reliable internet is lacking. Hike has also managed to successfully embrace various cultural and minority groups in India. This is shown by the fact that the app is available in seven languages, with stickers in 40. As a result of this, Hike has managed to draw a large number of its users as from the less developed, rural market in India.