Xiaomi, the Chinese smartphone and appliance maker, will reportedly invest $ 1 billion in 100 Indian startups over the next five years. The company is seeking to create an ecosystem of apps around its smartphone brand.
According to Chief Executive Officer of Xiaomi, Lei Jun, Xiaomi and its sister company, Shunwei Capital will invest in businesses such as content, financial technology, hyperlocal services and manufacturing. Currently, both the companies have a stake in six Indian internet companies including online songs portal, Hungama and microlending startup, KrazyBee.
Lei Jun further added Xiaomi has invested over $ 4 billion in 300 companies in China over the past 4 years. Speaking of the Indian investments, Lei Jun said, “We will basically replicate the most successful ecosystem business model of China in India. We will have all types of services and products and integrate them. That is the Xiaomi business model.” The company will focus on a few key factors of the business, while the partners will provide everything else.
Xiaomi is one of the most prominent investors in India after Alibaba and Tencent Holdings. One of the world’s most valuable privately held tech companies, if Xiaomi meets its investment target, it would also become one of the most prolific internet investors in India. However, the smartphone company is looking for investments that will expand mobile internet usage only. Lei added Xiaomi is hoping to make its value for money phones more lucrative to customers and therefore will invest in companies related to the acceleration of mobile internet. “We only pick minority stakes. The purpose is to work closely (on the business side) with these companies,” he added.
As per a report by research firm IDC, Xiaomi became the number one smartphone vendor in India accounting for 23.5% of smartphone shipments in the country. However, the company, which sells its products in 60 countries, will not list its shares anytime soon. Recent reports also suggest the company may even report a total revenue of up to 109.75 billion yuan ($16.8 billion) for the current financial year and is currently valued at $ 69 billion approximately.