Japanese news app SmartNews nabs $10M bridge round, at pre-money valuation of $320M
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Photo Credit: SmartNews

In Japan, SmartNews has a strong Japanese following of its own, but its recent moves prove that it is interested in playing on the world stage

Tech in Asia

The back-and-forth between SmartNews and Gunosy, Japan’s premier news apps that are taking their domestic war global, added a new chapter today. Only a week after Gunosy filed for a $263 million IPO, SmartNews tells Tech in Asia that it has nabbed a $10 million bridge round at a pre-money valuation of $320 million.

The funding round features previous investors Gree, Globis Capital Partners, Atomico, Mixi, and Social Venture Partners. Since its founding in June 2012, SmartNews has publicly raised a touch over $50 million.

That’s a lot of coin, but SmartNews, available on iOS and Android, has the business fundamentals to back it up. As we have covered in the past, SmartNews grabbed 1 million monthly active users (MAU) in the U.S. to complement its 4 million MAU in Japan. Its international app, which launched in 150 countries last month, has raced out to 10 million downloads.

That growth is led by the United States, followed by India, Canada, the United Kingdom, and China. The United States is where SmartNews is focusing most intently. It has a local team in San Francisco of about ten and is expecting to add more employees. Worldwide, the team is over 40 people, a number that is expected to double or triple this year, according to Kaisei Hamamoto, co-founder of the company.

Engineers, specifically data scientists, are sure to be a focus of the firm’s hiring efforts. Its success so far is the result of having a robust, advanced algorithm for finding the right news for each user.

“Our algorithms review both local and global sources to tailor the news to that specific country’s trends and reading habits. For example, when I traveled to London, I saw both UK-specific articles from the Guardian and BBC, and articles from CNN and NBC News because these American articles were trending in the UK that day. All too often ‘trending on Twitter’ can be too U.S.-centric. We take in consideration what’s actually relevant and trending in your country,” co-founder Ken Suzuki tells Tech in Asia.

At this point, it might soon be time to retire the assumption that SmartNews and Gunosy are binary, opposing forces. Gunosy’s close relationship with telco KDDI and its IPO are both signs that the company is a serious player with powerful backers. In Japan, SmartNews has a strong Japanese following of its own, but its recent moves prove that it is interested in playing on the world stage. It is now less a question of whether or not the startup can vanquish Gunosy, but if it can muster up a challenge strong enough to topple global leader Flipboard.

Editing by Josh Horwitz

This post was originally published on Tech in Asia

Featured Image Credit: SmartNews

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