China's Tencent invests in India's Hike to take on WhatsApp

Facebook may have a new India problem.

WhatsApp’s India rival Hike has raised $175 million in funding at a valuation of about $1.4 billion in a Series D round led by China's Tencent and Foxconn, making it the latest tech "unicorn" in the country. Hike was founded by Kavin Bharti Mittal, the scion of Bharti Enterprises, which also owns India's largest telecom service provider, Bharti Airtel.

Tencent’s interest in the service doesn’t come as a big surprise. Hike claims to have over 100 million registered users in the country, which makes it the closest competitor to WhatsApp. The investment gives Tencent an instant foothold in the Indian market. WhatsApp has over 100 million monthly active users in India, which is also one of its biggest markets.

Tencent's WeChat is a hugely popular messaging client in China with over 700 million monthly active users and a billion registered accounts as of earlier this year, but its market share remains limited outside the nation’s boundaries. The company also owns QQ instant messenger which boasts of more than 600 million active IM accounts.

Hike serves as a platform for news, games, and shopping coupons on its app in addition to providing text messaging and voice calling services. The app also offers several features tailored for the domestic audience. For instance, a Hike user can send a free text message to people who are not on the app yet, a feature that is popular in India due to poor Internet penetration.

Hike Messenger's existing investors Tiger Global. Bharti and SoftBank also took part in the round.