Saregama India (SIL) has announced acquiring 92.61% of M/s. Pocket Aces Pictures Private Limited (PAPPL).
- PAPPL, incorporated in December 2013, is a digital entertainment company that primarily creates short-form video content aimed at young Indians, with over 30 new items added every day.
- It claims an IP catalog of 3000+ content pieces ranging across web series, sketches, music videos and reels on its channels FilterCopy, Nutshell and Gobble.
- The startup manages over 100 digital talents and has licensed IPs like “Little Things” to Netflix. They have also provided content to platforms such as Amazon, Hotstar, Jio, MX Player, Vistara, and Qatar Airways.
- According to SIL’s press release, PAPPL owns direct relationship with 95 mn + young digital-first customers across Instagram, YouTube etc.
- According to it’s website, Pocket Aces reaches 50 million viewers weekly and accumulates 700 million views monthly.
- The startup reported revenues of Rs. 104 cr in FY23. Revenue has grown by 34% CAGR over the last 4 years. Very likely it would be loss making.
- In February, it had laid off 50 employees or about 20% of its workforce as part of a corporate restructuring drive.
- PAPPL has raised nearly $20 million over the years and counts Peak XV Partners (Sequoia) and 3one4 Capital as its early investors.
- The last equity funding round was $14.5 mn in July 2019. Speculated valuations then were similar to the current transaction price.
- PAPPL spun off its game-streaming unit, Loco, in 2021. Loco, now led separately buy the co-founders, has raised $51 million and is valued at nearly $200 million. It is not part of the acquisition.
- SIL is acquiring the total of 92.61% stake in three tranches
- Tranche 1 – Within 2 months – Rs 174 cr for secondary purchase of 51.82% stake
- Tranche 2 – Within 2 months of completion of tranche 1 – Rs 15 cr for primary purchase
- Tranche 3 – Within 18 months of completion of tranche 1 – consideration to be based on future revenue multiple
- Balance 7.39% would be retained by the existing promoters of PAPPL.
Saregama through acquisition is seeking to expand it’s portfolio of intellectual properties and distribution network. It’s targeting PAPPL’s network of 95 mn+ followers to popularize it’s music library among the 18-35 audience segment.