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Dream11: New Unexpected Entrant in India’s Unicorn Club

India’s ballooning unicorn club has a new debutant. This piece of information may not make for an exciting news as much as the fact that the new entrant hails from unlikely industry of gaming. The name of this new entrant is Dream11, an online gaming firm offering fantasy gaming experience in various sporting categories like cricket, football, NBA so and so forth.

Offical logo of Dream11

Secondary investment from Steadview Capital propels Dream11 to unicorn club.

Dream11 on Tuesday raised secondary investment from Steadview Capital, a leading alternative asset manager focused on the Asian market. The investment propelled the gaming firm’s valuation to little over $1 Bn, making it the first Indian gaming company to top up the billion dollar valuation. The secondary investment also helped existing investors like Kalaari Capital, Think Investments and Multiples Equity to make profitable exit from the company. However, it could not be ascertained at what price these existing investors have sold their shares.

Dream11’s entry in unicorn club may not appear all that unexpected if we glance through figures put forth by the company. The company claims its user base has grown at a compound annual growth rate (CAGR) of 230% over a period of three years. Its current user base stands at $50 Mn, which is probably the highest user base boosted by any Indian gaming company. But Techpluto was not able to access Dream11’s profit and loss numbers.

The gaming company’s debut in the billion dollar club appears even more unsurprising given that it had raised whopping $100 Mn in September last year. The funding round had pushed the company in touching distance of securing the unicorn tag. However, Dream11 securing the unicorn tag still makes for a very flattering proposition, especially considering that there are several deserving companies like Bookmyshow that are still waiting in the queue.

But questions like do unicorn tag merely have an oriental value or it really helps the company in the long run continue to be debated by analysts. We have prominent examples in startups like Hike, Snapdeal and Shopclues. These high flying startups were once proud members of India’s fast mushrooming unicorn club but today are struggling to stay afloat.

We hope that Dream11 does not end up in the same soup. More so because it is from the gaming industry and India’s rapidly growing unicorn club certainly needs players from diverse sectors.

 

 

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