What is the next leg of the growth?

From the outset, the application looks more cluttered compared to TikTok. But Likee has gone far and wide to differentiate itself from its rival.

Tarun Nayak, a venture capitalist with Matrix Partners India who has researched on the short-video ecosystem said, “Likee’s growth has been possible because they have taken a differentiated approach to the short-video market than that of TikTok—via microtransaction.” The major difference is in the way creators get paid in Likee.

Showcasing the skills

Performers on Likee can go live to showcase their talent, entertain viewers and receive gifts (typical of YY)—roses, diamonds, crown, makeup—which they can exchange for Indian rupees. YY pioneered this digital-gifting function in China which acts as a strong incentive for active streamers to come back to the platform. Likee creators can perform and ask fans to send gifts in return.

“Engagement is critical to make money. By offering a dashboard to track engagement metrics, Likee lets the creator know where they are lacking. This is an immense value-add to help them earn more,” Nayak said. The platform also has a leaderboard that ranks people who received the most number of likes and views every day. There is a dedicated tab for ‘rising stars’ within the app. These initiatives have helped Likee position itself as a creator-first platform as opposed to the consumer-first approach that TikTok has taken.

Take K (name withheld), 19-year-old engineering drop out from Rajasthan who earns Rs 2 lakh ($2,780) a month on Likee. “TikTok has now become a professional platform. For a guy like me, it is hard to break in,” K said. “[On Likee], sab kuch chalta hai (anything goes), bro. I can start making money quickly. On TikTok, it’s difficult.”

As one would have come to expect of Chinese live-streaming apps, it has a mix of viral dance videos, bike stunts, baby videos, and, of course, suggestive thumbnails of young women.

But the major differentiator in Likee is its live-streaming option which lets creators interact with users directly. There exists a ‘battle’ feature where two streamers can occupy split-screen and request fans to support them with gifts. The screen has a countdown ticking, and the objective is to beat your opponent’s score by calling on the audience to gift and help you win. Depending upon the beans (gifts) one gets at the end of the countdown, a winner is chosen, but viewers cannot see the bean count while the battle is on.

Evolving with passing time

Likee’s gross revenue in the year since 1 November 2018 stood at $5.5 million, with India contributing 17.9% of it, as per Sensor Tower. The revenue is not ad-monetized yet, unlike TikTok. Likee is evolving from a microtransaction standpoint, which depends on how Indian users evolve over a period of time. While it might take a while for Likee to become as big as TikTok, “one of the most important data points that we’ll get from Likee over the next 2-3 years is how microtransaction spend versus the ad spending ranks in India,” Nayak said.

Live-streaming application Bigo Live follows the same microtransaction business model with encashable virtual gifts. It has become a top-10 grossing live-streaming app outside of China. Since November 2018, Bigo Live has made $413 million, with India contributing $7.7 million of that, as per Sensor Tower data. While the revenue contribution from India is ~2%, it constituted a 30% revenue change year-on-year.

Despite its exponential growth with two-thirds of its users in India, Likee India still does not have a publicly-known country manager. The most likely reason is, “that the majority of revenue from BIGO is from live streaming of Bigo Live. Likee is in very early stages of monetization,” Xueling said on the analyst call. “In terms of the country breakdown, we are seeing, obviously, more rapid growth from the developed world including US, Europe, Korea, and Japan, etc”. Bigo Live, meanwhile, has a deputy country manager for India, Nagesh Banga.