Prosus Eyes Investment in India, Seeks to Replicate China’s Service Ecosystem Success

Dutch tech investor Prosus believes that India will have a tech company with a $100 billion valuation in the coming years, CNBC has reported. Owned by South African company Naspers, the firm is among the largest tech investors in the world and is currently planning to make its next big Prosus investment in India.

A Long Term View

Previously, Prosus invested in the gaming and social media giant, Tencent. Naspers acquired close to 50% stake in Tencent in 2001 for an estimated $32 million. This investment yielded good returns for Prosus with its early stake growing to billions of dollars.

On June 23, the valuation of the WeChat owner stood at close to $600 billion. The tech investment firm is seeking to replicate this success by backing India’s digital future through Prosus investment. In India, Prosus has already invested in highly promising tech companies including ecommerce firm Meesho and payments startup PayU.

“The companies in India are still small, our investment there is around $10 billion, as it was in China 14 years ago. What’s the learning? We believe it’s going to be, not a $20 billion company, but a $100 billion company, maybe [a] half a trillion dollar company in India. So we are not investing there to sell next month,” Prosus CEO Fabricio Bloisi said.

Service Ecosystems

Over the years, Prosus has been directing large investments in other parts of the world, including Latin America and Europe. The tech investor’s strategy revolves around building service ecosystems similar to the one that Tencent executed in China. Currently, the tech giant runs the largest messaging platform in the country, WeChat. The platform integrates other important features such as payments, food ordering, and taxi hailing services.

“We believe that we have ecosystems, just like we have in China in the US, like Microsoft or Uber or Google or Meta. They’re not just one product. They have one product that enables cross-sell and technology shared between many other adjacencies. That’s what we are doing,” Bloisi said.

Prosus has invested in Brazilian food delivery startup, iFood in Latin America. The tech investor also has a stake in the online marketplace OLX Brasil and travel company Despegar. According to CEO Bloisi, payments and food delivery form the foundation of his company’s investments, with others being travel and ecommerce.

“That’s the kind of ecosystem we believe in. We learned that from China, we are doing that in Latin America right now, very, very successfully,” Bloisi said.

In Europe, Prosus is looking to acquire food delivery giant Just Eat Takeaway in a deal worth $4.7 billion. On Monday, the tech investor commenced the approval process of the acquisition deal by the European Commission. Bloisi expressed optimism that EU regulators will approve it fast.

A Strong IPO Strategy

The Investment firm holds a significant stake in Swiggy. The food delivery company launched an initial public offer last November. According to Bloisi, public listing of Prosus-backed tech startups is an important strategy for the investment firm. The CEO said that his firm expects five Prosus backed billion-dollar startups in India to launch IPOs in 2026.

“I think this is very good for India, because we have the local markets here investing in the local companies. This was critical for the US, this was critical for China. I think if India can have greater, strong local markets investing in tech, it’s going to be amazing,” Bloisi said.

On June 23, the tech investor reported a 47% surge in its full-year earnings. The company said its core earnings hit the $7,4 billion mark, surpassing its financial targets. This earnings growth was largely attributed to its expansion into ecommerce and food delivery investments.

Prosus is in the process of changing from an investment group to a tech firm that runs services like fintech, food delivery, and ride sharing. Analysts say that this change will shift its tech investments in the coming years.