Chinese phone and appliances machine Xiaomi Corp. will commit approximately $1 billion in 100 startups in India over the next five years, seeking to create an ecosystem of apps around its smartphone brand, leader Lei Jun said during an interview. Lei said Xiaomi and its own sister company Shunwei Capital, which have purchased stakes in six Indian internet companies including Hungama and KrazyBee, will spend money on businesses such as content, financial technology, hyperlocal services, including mobile phone repairs, and production to be able to increase the adoption of mobile internet in the country.
“In China, in the last four years we’ve invested $4 billion in over 300 companies. In the next five years, we will invest in 100 companies in India. We will fundamentally replicate the most successful ecosystem business model of China in India. We will have all sorts of services and products and integrate them. That is the Xiaomi business model. We give attention to a few key things and everything else, we let our lovers provide. We’ve come to simply a huge scale in seven years due to this collaboration”, Lei said.
Xiaomi, one of the world’s most effective privately held tech companies, is the most dominant Chinese shareholders in India following the two internet giants, Alibaba Group Holding Ltd and Tencent Holdings Ltd. If the company fulfills its investment target, it would become one of the very most prolific internet investors in India. Unlike Alibaba and Tencent, Xiaomi is merely looking for investment funds that will broaden mobile internet use and connect customers to its mobile phones in a smartphone market that is defined by fickleness among shoppers in frequent lookout for the next new thing. By giving entertainment content and other services, Xiaomi is looking forward to make its value-for-money mobile phones more lucrative to customers and differentiate its offering from those of competitors such as Samsung, Vivo, Oppo yet others.
“Any apps that increase the frequency of usage of smartphones–we’re thinking about this. As long as it is related to acceleration of mobile internet. We only opt for minority stakes. The purpose is to work directly (on the business enterprise aspect) with these companies”, Lei said. Xiaomi, which entered India in 2014, accounted for 23.5% of smartphone shipments in the country in the Sept quarter, according to analyze firm IDC, becoming the joint No. 1 smartphone seller in India. Samsung also acquired 23.5% share in the 1 / 4. In the preceding 90 days, Xiaomi’s market show was 17%.
Xiaomi, which last raised equity capital at a valuation of $45 billion in late 2014, markets its phones in some 60 countries. India is the business’s biggest market outside of China, where it sells a number of products including television sets, smartwatches, electronic home air cleaners, water purifiers as well as others. The company will introduce other products in India over the next two quarters, Lei said. The company’s valuation makes Lei, a successful serial businessman, one of the richest men in China. Among his earlier projects was Joyo, an online book store bought by Amazon.com when it entered China.