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HT Media Buys Social Networking Site DesiMartini

Hindustan Times Media group has bought social networking site Desimartini.com, through its online subsidiary Firefly eVentures. The financial terms were not disclosed, but HT Media said it was for less than $10 million (Rs 39.3 crore). The site was launched late last year, and has a membership base of 250,000, and has around 2.5 million page views a month, the company says.

Of course there is tons of competition in the space: Google’s (NSDQ: GOOG) Orkut, ibibo, Indyarocks, Yaari and Bigadda, among others. According to Amit Garg, business head, internet, HT Media,

18 Responses to “HT Media Buys Social Networking Site DesiMartini”

  1. Mehul, Raja, Joseph and anon:

    Looks like I'm in a damned-if-I-do, damned-if-I-don't situation.

    In order to keep the story absolutely independent of my association with Vivek, we took a call and Rafat did the story instead of me.

    Now, it seems that since I didn't criticize the deal, both ContentSutra and I getting flack. So I guess it's time for me to come clean on HT's acquisition of DesiMartini:

    1. I honestly don't know how much Vivek got for DesiMartini. He hasn't told me, and not even a ballpark figure, even though I have asked him many many times. The figure we have quoted is from a Mint story, and we haven't been able to get any more details, though we have tried.

    2. I don't think the site was worth buying. HT probably has its own reasons, but I can't make sense of it. They either bought the platform (save time-to-market), registered users, active users or domain name. I don't think the domain name is worth anything, or whether there were many active users (going by alexa comparisons with other social nets). So, they probably reduced time to market (6-7 months) and got a registered user base that they can send emails to, to try to renew their interest in the site. There doesn't seem to be much else.

    3. We cover funded startups or startup deals with big media cos. We have not covered Desimartini before, apart from the IAMAI Web 2.0 conference (as a part of the conference coverage). So it's not that I have been kind to DesiMartini…we just didn't cover it.

  2. Few points:
    a) I agree with people that Nikhil is over critical on start-ups (in general) and has been over kind with Desi Martini – not fair in the blogging world.
    b) A friend of mine, who is closer to the deal, told me that it is around $200-$225K that HT has paid for Desi Martini – am shocked how misleading could DM get. And am further shocked at Nikhil running that story without any proper moderation/ thought.

    I guess its time to move to a different blog site.

  3. I was re-reading the post, and I agree with anon and joseph.
    Contentsutra is usually very critical of new startups, and surprisingly they are mum on desimartini. Disclaimer doesnt mean that you have to milden up your criticality on the deal. I would expect a more sincere reporting.

  4. Just check the alexa graph of the site for last 12 months and you can conclude from the heavy drop in traffic gathered through TV ads that users came once, registered and left. The site was more or less dormant they didnt even change the logo to one advertised in TV. Talking even a million dollar for it does not make sense a million is a lot dude.

    Shoumik
    http://www.goforads.com

  5. The writer himself notes that the founder is a cousin of Nikhil. This seems like a clear instance of unethical, self serving journalism. Based on his experience in the tech field it should have been obvious to him that the real number must be MUCH less than 10 million USD, but he did not mention it.
    This site is losing credibility fast.

  6. Quoting Amit Garg, business head, internet, HT Media, “It may look like we are late in getting into the local social networking business, but the…."

    Pls note the phrase "local social networking". With genuine curiosity, what does local social networking mean? and how does desimartini fit here?

  7. Well to my knowledge (sources from HT) the site got sold off for less that $200k off course thats also less then $10m as said by Mr. Rafat but it is a wrong communication to create a false good impression for Vivek Pawa as a hugely successful ent. People in media must not work for personal gains.

  8. I agree with Prashant . HT is a very cautious player. They wouldn't have paid so much to get Desimartini.com. My guess is also that they would have paid in the range of 4-6 crores. In that case it is not a bad deal.Given the fact they have access to lot of free media and recent good work they have done with Fever and Mint i will not be surprised if they make something good out of this deal.

  9. Gaurav – I have a similar hunch. I am pretty sure their page views are bloated. But they might have 250k "registered" users.

    Prashant – Interesting info 400crore cash pile. You are so right on the importance of integration and how they take it from now.. a $1 million looks like a reasonable value to me for desimartini .. but 10 million seems too much ..Does anyone have concrete data on this. Does anyone have data on MIH buyout of bixee, and pixrat ?

  10. hmm there is more to this deal if you see it in proper context . look at the following facts .

    #1 Desi Martini is a Reasonably good player in this space . thanks to Makkadman viral . it got good number of eyeball and awareness. What matters is that you should be able to cause a blip on the radar of potential buyer which they did .

    #2 HT is on a PE Investment and Buyout spree , yesterday only the announced Buying a stake in Crazy Noodles a Chinese Eating joint . [http://tinyurl.com/2xdxxm ] HT is sitting on 400 Crore Cash pile they raised from IPO , so they had to invest that money somewhere . $1 Mil investment to get a foothold in Indian Soc Nw. Space is not a bad deal given that it has a clear potential of integrating with their regular print & online business .

    #3 Given there Connections ,Proof of adaptation & lack of good deal available in Indian Online space . it wouldn't be a herculean task for DM team to raise money from VC . than HT would have to pay multiple of $10 million to buy them .
    Crux of deal is not what HT bought but how well they use it . It would be interesting to watch . how they integrate it . and this less than $10 Million price tag thing is just a trick to create a NEWS and hence traction for DM . My hunch is that real price should be somewhere in the ball park of INR 5 -To-8 Crore .
    if not anything else this deal will work as a inspiring story for aspiring entereprenuer .

  11. * Does anyone know the actual terms of the deal ? The actual payout ?

    * Rafat – any ideas on authenticity about the numbers (2.5 million page views/2.5 Lacs registrations ), Their traffic has plummeted in the recent months.

  12. Last heard about desimartini was the viral ad of makkadman.

    I guess HT had that in mind when valuing desimartini now. Kudos to webchutney for not just making viral ads but also indirectly shooting up the valuations of their clients :)

  13. Rachit Ahuja

    Can somebody please justify the valuation?

    As such even $1m is less than $10m so it is likely that it got acquired for just $1m or thereabout. Perhaps by saying "less than $10m" they are just trying to create a perception of inflated valuation…for competition?

    I remember another Indian social networking site in an interview said that they have less than 1m users. Of course that is true as 25000 is less than 1m too.
    :)

  14. Insightful

    Congrats to the DesiMartini team.

    Pls fix following error when i try to hit the home page:

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    home updates public online search photos blogs videos groups discuss fun invite mobile login
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