Even though tech giants such as Facebook and Apple are starting to integrate news into their platforms, a new independent startup in Japan has landed a round of funding to step up to the plate. SmartNews, which is a news aggregation app that works with some 1,500 publications, has raised another $38 million in a Series D round of funding. The app makes selections of stories based on which articles you read. The startup is approaching 20 million downloads, and will use the funding in order to allow for a larger user base. The will additionally be using the funds to grow their overall revenues, especially those outside of Japan, by hiring and expanding their machine learning-based news-combing technology.
The investment is led by the Development Bank of Japan, and SMBC Venture Capital, as well as Japan Co-Invest L.P. This brings the total raised by SmartNews to around $90 million. The company is not currently disclosing their valuation, however, experts predict it to be between $500 million and $600 million, after the round of funding. That is a considerable bump from last year when its valuation was around $320 million. However despite its plans to reach out to the U.S. market, Japan remains its single biggest market, with 10 million users.
“Just as important as the funding is the continuing expansion of the Japanese business and the ramping up of our U.S. business. We’re feeling very good about things,” said VP of content, Rich Jaroslavsky. “Business has been doing so well in Japan that it has diminished any pressure to start monetizing in the U.S., and that’s wonderful”.
Although the printed newspaper industry is in decline, there recently has been a major boom in the news within the digital world. Users across all platforms are starting to enjoy getting news instantly, however, some feel overwhelmed by the vast majority of content out there. However, SmartNews has found a way to break through the competition, by building algorithms to help comb out all the news you aren’t interested in reading. As Smartwatch continues to build a business in Japan, watch out for it to break through to the U.S. market.