Over the past few weeks, Jio Platforms has seen the ultimate acknowledgement of its commitment towards India’s digital transformation, courtesy seven investments so far in a span of six weeks. The journey began with Facebook, which invested $5.7 billion, or Rs 43,574 crore, to pick up a 9.99 percent stake in Reliance Jio. Earlier today, it was confirmed that Jio Platforms Ltd is getting another big investment, this time from returning American equity firm Silver Lake. The latter has invested an additional Rs 4,546.80 crore in Jio Platforms, on top of its investment of Rs 5,655.75 crore in the company from last month. The combined investment has given the firm a 2.08 percent stake in Jio Platforms, coming alongside the likes of General Atlantic, Vista Equity, KKR and Mubadala.
Silver Lake is an American equity firm that invests heavily in technology companies. Their investment in Jio Platforms follows investments in other big tech companies, including Airbnb, Alibaba, Ant Financial, Alphabet’s Verily and Waymo units, Dell Technologies and Twitter, to name a few.
The recent deals firmly cement Reliance Jio and its subsidiary Jio Platforms’ credentials as a tech company. Its Facebook deal is the biggest minority shareholding deal ever for the social media giant, and also the largest foreign direct investment (FDI) for a minority stake in India. It is also the biggest investment in a technology company in India. That itself had put Jio Platforms among the top five listed companies in India by market capitalisation, within three and a half years of the launch of commercial services.
Commenting on the additional investment, Mukesh Ambani, chairman and managing director of Reliance Industries Ltd, said, “Silver Lake and its co-investors are valued partners as we continue to grow and transform the Indian digital ecosystem for the benefit of all Indians. We are pleased to have their confidence and support, as well as the benefit of their leadership in global technology investing and their valued network of relationships, as we drive the Indian Digital Society’s transformation. I would like to emphasise that Silver Lake’s additional investment in Jio Platforms, within a span of five weeks during the COVID-19 pandemic, is a strong endorsement of the intrinsic resilience of the Indian economy, which will surely grow bigger with comprehensive digital enablement.”
Egon Durban, co-CEO and managing partner of Silver Lake, also said about the investment, “We are excited to increase our exposure and bring more of our co-investors into this opportunity, further supporting Jio Platforms in its mission to bring the power of high-quality and affordable digital services to a mass consumer and small businesses population. The investment momentum behind Jio validates a compelling business model and underscores our admiration for Mukesh Ambani, his team and their courageous vision in creating and building one of the world’s most remarkable technology companies.”
Jio is already present in the broadband space, smart devices, cloud and edge computing, Big Data analytics, artificial intelligence, Internet of Things (IoT), Augmented and Mixed Reality as well as blockchain Blockchain. The two new investments give it a crucial boost as it builds on what Reliance Jio calls the Digital India vision for 1.3 billion people and businesses across the country, including small businesses, micro-businesses and farmers.
The Reliance Retail’s New Commerce business, as part of the Facebook deal, gets to use WhatsApp as the platform for pushing JioMart. As of July, last year, there were more than 400 million active WhatsApp users in India. And counting. The vision for this project is to bring the nearby stores to consumers on WhatsApp, where they can browse the listings of what is in stock and what is available and place the orders on the platform itself. The nearby Kirana shops will get access to a platform they probably would have never had access to before, with a massive demographic of users potentially tapped in one fine swoop. And there are millions of these small merchants and Kirana stores across India.
Jio has already been able to make its mark so far by reaching out to pretty much every strata of the society, and not just those who would potentially return higher revenues per user. The Jio mobile data pricing is the biggest example, which has completely changed the way the telecom industry operates.