EloElo raises $80M to expand India’s microdrama business

Indian microdrama company EloElo has raised $80 million in a Series C round, according to TechCrunch. The funding came from Hornbill Capital and NBCUniversal. The new money takes the company’s total fundraising to $130 million and gives it a valuation of $500 million.

The investment centres on Story TV, one of the leading microdrama apps in the country. Analysts cited by TechCrunch put its active user base at more than 33 million. Across all of its apps, EloElo says it has more than 40 million monthly users.

Why investors are interested

Microdramas are short, serialized videos designed for phone screens. TechCrunch reports that more than 118 million people in India watch them every month. The format has also grown in the United States and China, where well-known Hollywood figures have invested in or appeared in such content.

India has more than a billion internet users, which makes it a large market for entertainment. Analysts expect the sector’s annual revenue to pass $3 billion to $4 billion by 2030. Story TV, Kuku TV and Quick TV ranked among the most downloaded streaming apps in the country last year.

Founder Saurabh Pandey, a former Flipkart executive, started the company in 2020. According to Pandey, users spend an average of 95 minutes a day on the app across several sessions. He told TechCrunch that he sees mobile devices as the main form of entertainment for the next wave of users, while big-screen viewing will remain for family or group occasions.

Monetisation remains a challenge

Earning money from the format is harder than attracting viewers. Story TV offers monthly, quarterly and yearly subscriptions, along with free content supported by advertising. TechCrunch notes that advertising may bring in less revenue than subscriptions.

Figures from a Redseer report show that over 40 million viewers have bought a microdrama at least once. Yet only 15 to 17 million of them pay every month. In another poll, Ormax Media reported that 72% of viewers had never handed over money for content while watching.

Competition is also strong. Microdrama apps compete with free platforms such as YouTube, Instagram and TikTok, where creators already post content at no cost. EloElo says quality production will be the main way to keep viewers.

Plans for AI and new products

EloElo is using its Dolphin AI platform, which began as an internal tool for video creation. The company plans to make it widely available. The tool can serve as an editor, offering templates and several models for making pictures, sound and video. The company also hopes marketing teams will use it for campaigns and ads.

Pandey described AI as a fast tool that still needs skilled human creative direction. The company also runs Master, a vertical video learning app, and Voxy AI, an AI companion app. EloElo currently has 240 staff and plans to hire more for its AI and machine learning research team. Part of the new capital will go towards original titles.

Other investors in the round include MIT Investment Co., Play Ventures, Kalaari Capital, Waterbridge Ventures and Griffin Gaming Partners, according to TechCrunch.

Frequently asked questions

Sources

• TechCrunch: India’s EloElo nabs $80M from NBCUniversal to bet on the country’s rising microdrama market

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