The microblogging website Koo, touted as a desi alternative to Twitter, saw monthly active users fall. The Koo app has been experiencing a decline in its monthly active user (MAU) base since its peak in July 2022. According to data from Moneycontrol, Koo’s MAUs dropped from 9.4 million in July 2022 to 3.1 million in April 2023. It, however, said the numbers were inaccurate and refused to share any specific details on the declining trend.
“As a privately listed company, we are not required to disclose information on our burn, financial information and DAU/MAU numbers publicly. The numbers you have stated in your questions are also incorrect. With the global slowdown and the current market environment, our focus this year has been to optimise our costs and focus on revenue. We have moved from a growth engine to a very efficient system that is super optimised on marketing, tech and people costs, successfully bringing down our burn by 4X,” a company spokesperson told Moneycontrol.
Start Up Journey :
Founded by Aprameya Radhakrishna and Mayank Bidawatka in 2020, Koo has raised over $65 million from large investors like Tiger Global, Accel, Blume Ventures and was last valued at over $270 million, as per data available on Tracxn, a market intelligence data provider. Naval Ravikant and Balaji Srinivasan are among the notable angel investors in Koo, data showed.
That time, founders Aprameya Radhakrishna and Mayank Bidawatka aggressively pitched for celebrities and political leaders to use Koo as an alternative. A bunch of them, like Union IT Minister Ashwini Vaishnaw, Dalai Lama, Baba Ramdev, Anupam Kher, Yogi Adityanath, Nitin Gadkari, Supriya Sule etc. created their accounts on the app. Some Media Institutions like Dainik Jagaran, Republic TV, News18, NDTV etc, also created their account on Koo app. Even globally, users in Brazil flocked to Koo which pushed downloads late last year. In just over three years of launch, Koo is the second-largest microblog available to the world with over 20 global languages on the platform.
Then, Technical Challenges started for Tech Start up Koo. The Tiger Global-backed startup saw its MAUs drop to about 3.1 million in April 2023, the third straight month of decline this year. In January 2023, Koo’s MAUs were around 4.1 million, which fell closer to 3.5 million in February and dropped again to about 3.2 million in March. The 3.1 million MAUs in April was just about a third from a peak of 9.4 million in July 2022, when Twitter and the Indian government were involved in a legal tussle.
Experts Opinion : Catch-22 situation
An internet sector analyst said Koo is in a Catch-22 situation. If the company continues to lower its burn rate, it will see declining MAUs. It can choose to shore up MAUs but that would mean burning more money than it already has and most investors won’t be willing to take that route now. To be sure, most consumer internet startups are facing a similar dilemma and the situation is not specific to Koo.
The jump in losses was also because Koo has scaled fast with 60 million downloads in the past three years. This comes at a time when Koo’s revenues were just Rs 14 lakh in FY22, as per the latest available data, up from Rs 8 lakh in FY21. During the same period, Koo’s losses jumped 460 percent to Rs 197 crore from Rs 35 crore in FY21.
The steady decline in Koo’s MAUs was largely because Koo was spending lesser to acquire new users, and also retain existing users as it lowers its cash burn rate in an environment where capital has become difficult to access. It reduced marketing spends and at least two rounds of layoffs in the past year or so, Koo managed to reduce its monthly cash burn, as per moneycontrol.
Several Other factors have contributed to Koo’s declining user base :
Reduced Marketing Efforts : Koo has significantly reduced its spending on user acquisition and retention in an attempt to lower its cash burn rate, which may have led to a decline in new user growth.
Lack of Distinctive Features : Koo offers many pro features to its users free of cost like long post, edit option etc, but Koo lacks unique features that would set it apart from established micro blogging platforms like Twitter (X). This makes it less appealing to potential users.
Loss of interest from Indian government : The Indian government was a key early supporter of Koo, but the company’s relationship with the government appears to have cooled in recent months.
Loss of interest from Indian users : The Indian people was great supporter of Koo, but the company’s policy to recognize Indian People, Brand and Start Ups based on recognition from foreign Platforms like Twitter(X), Instagram, Facebook etc, cooled the great support of Indian Users.
Limited Content Ecosystem : Koo‘s content ecosystem is still relatively small compared to its rivals. Koo compares itself with meta and X and not ready to recognize small or medium content publishers, so small medium publishers also kept distance from Koo. This made it difficult for users to find interesting and engaging content on the platform.
Competition from established micro blogging platforms : Koo faces tough competition from established micro blogging platforms such as Twitter and Instagram. These platforms have a much larger user base and are more familiar to Indian users.
Future :
Despite these challenges, Koo’s management team remains confident in the app’s future, and committed to the app and are continuing to work on improvements. The company is continuing to invest in product development and is working to attract new users. They are focusing on enhancing the user experience, expanding the content ecosystem, and attracting more users from different regions and language groups. It is also exploring opportunities to monetize the app, such as through advertising and premium features. Company says it is well-capitalized and remains positive about building a social media platform from India for the world.
It remains to be seen whether Koo app will be able to reverse its decline and become a major player in the Indian micro blogging market. However, the company’s future is uncertain, and it faces a number of challenges that it will need to overcome in order to succeed. Hope for the best!
