Just a few days ago, the technology landscape in India was changed like never before, with the confirmation about the partnership that Reliance Jio and Facebook. For starters, that $5.7 billion, or Rs 43,574 crore deal, gave Facebook as much as 9.99% stake in Reliance Jio. Earlier today, it was confirmed that Jio Platforms ltd. is getting another big investment. Reliance Industries has confirmed that investment firm Silver Lake will invest Rs 5,655.75 crore into Jio Platforms. 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.
Silver Lake is one of the most respected voices in technology and finance. We are excited to leverage insights from their global technology relationships for the Indian Digital Society’s transformation,” says Mukesh Ambani, Chairman and Managing Director, Reliance Industries Ltd.
Both these deals firmly cement Reliance Jio’s and indeed its subsidiary Jio Platforms credentials as a tech and platform company. After all, the Facebook deal is the biggest minority shareholding deal ever for the social media giant and also the largest foreign direct investment (FDI) for minority stake, in India. It is also the biggest investment in a technology company in India. That had put Jio Platforms among the top 5 listed companies in India by market capitalization, within three and a half years of the launch of commercial services. Now the investment from Silver Lake, whose investment portfolio looks rather robust with the who is who of the tech world—across domains including e-commerce, shared economy, software, internet of things (IoT), Artificial Intelligence, cloud-based platforms and automotive tech.
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.
The fact is, Jio has 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.
The Facebook partnership and the Silver Lake investment comes at a time when technology is in focus, including digital payments, ecommerce and online tools in India. People are staying indoors, which means they are relying on technology and the tools it provides for work, entertainment and even the basics of everyday life. At the same time, COVID has provided an unexpected yet massive boost to these online platforms, including digital payments. It is expected that the new habits will become the new norm in the future, as the country eventually emerges from the lockdown.