Rheo raises $2 mn seed funding from Lightspeed, Sequoia and others

FJS Tech, the parent holding of online e-sports streaming and community platform Rheo, has raised $2 million in a seed funding round from marquee venture capital firms Lightspeed India, Sequoia Capital India and nine HNIs (high net-worth individuals), it said in a statement on Wednesday.

“The capital will be used to further develop our product, produce more vernacular content on the platform and make key hires,” a company spokesman said in response to a TechCircle query.

Rheo was part of the second cohort at Surge, Sequoia’s 16 month-long flagship accelerator programme for early-stage startups in the Indian and Southeast Asian regions.

This makes for the Bengaluru-based startup’s first fundraise, which also included investments from Unacademy co-founders Gaurav Munjal, Hemesh Singh, Roman Saini and Dinesh Godara, former LinkedIn India head Mahesh Narayanan, Cuemath CTO Anushray Gupta, Zomato advisor Prashant Mallik, Byju’s CPO Ranjit Radhakrishnan and redBus founder Phanindra Sama, the statement said.

“Online gaming is rarely viewed as a platform that strengthens social engagement. At Rheo, we want to change that. Our mission is to redefine the gaming industry in India by using streaming channels as a way to create communities and encourage conversations – for both professional and hobby gamers. The ultimate goal is to make online gaming as entertaining and engaging as cricket and Bollywood in India, with an added layer of monetisation” Saksham Keshri, co-founder and CEO at Rheo, said in the statement.

The platform allows more than 100 different games to be streamed on the platform. Popular titles include PUBG, Free Fire and Call of Duty, Rheo added.

Launched in August last year, the platform currently has over 5,000 streamers who generate more than 900 hours of live content every day in five regional languages, the statement added.

“Gaming is the new prime time — people are spending over 60 minutes daily, between 6 pm and 12 am... India is no longer just a casual gaming market — even mobile mid-core titles like PUBG have seen a meteoric rise from 6 million to over 60 million monthly active users (MAUs) over just a few months. Watching other people play is the new type of sit-back entertainment” Vaibhav Agrawal, a partner at Lightspeed India was quoted as saying in the statement.

Users earn Rheo Coins through various activities, which they can use to play with their favorite gamers and redeem it for virtual goods across multiple games. Additionally, Rheo hosts its own tournaments. These are invite only and geared towards engaging with and rewarding passionate, top gamers on the platform.

Rheo was co-founded by two second-time entrepreneurs, Keshri and Prakash Kumar. Prior to Rheo, they co-founded Mojo Times, a video news platform for independent journalists.

“Mojo times was our first venture. We've pivoted since then to build Rheo,” the company spokesperson added an emailed response to TechCircle.

“The live game-streaming market is still in its incumbent stage in India. Rheo has the first mover advantage and will play a key role in shaping the industry,” the spokesperson added.

The market value of the gaming industry in India was around Rs 6.2 crore in 2019 and estimated to go up to over Rs 250 billion by 2024, according to November 2019 data from market research platform Statista.

The Indian gaming industry, which is undergoing a massive evolution owing to the country’s smartphone penetration, has only grown with investments from internet-based businesses such as Alibaba, Tencent, Nazara and Youzu, Statista added.