Rooter raises $16 million led by Lightbox to grow in India-like gaming markets

With fresh funds, the platform aims to expand its presence in markets that mirror India with a sizable gaming audience and preference for mobile-based content consumption, such as Southeast Asia and MENA regions.

In addition, “the current fundraise will provide the impetus to further develop the platform’s technology framework and pursue organic and inorganic growth opportunities,” said Piyush Kumar, Founder and CEO, Rooter.

Founded by Piyush Kumar and Dipesh Aggarwal, Rooter says it wants to become a global mobile game streaming platform on the lines of what Twitch has built for personal computers. The platform’s base has grown to over 60 million users and a million creators since its inception in 2016.

India has the world’s second-largest gaming base with half a billion games, as per a Lumikai report. Core titles like Free Fire, BGMI and Genshin Impact saw strong daily engagement, with over 80 minutes of average daily playtime per user in 2022.

Competitive streaming has seen a further rise after esports received official recognition from India’s Ministry of Youth Affairs and Sports last December. Over the last 12 months, Rooter claims to have achieved a 4x growth to hit an annual revenue run rate (ARR) of $7 million.

Given the growth potential, Indian gaming companies have raised $2.8 billion from domestic and global investors in the last five years, which has led to the rise of three unicorns in the space. However, no matter the growth potential, the funding winter has turned severe with venture capital investments in Indian startups touching a 28-month low in April as the global macro environment remains uncertain. Investors are no longer backing the growth-at-all-costs strategy.

“With more than a sufficient runway, we are expecting to cross $10 million ARR by the next quarter and hit profitability by April 2024,” said Kumar.

The path to profitability gave confidence to the lead investor — Lightbox. “Rooter has set strong benchmarks on how to strike the balance between growth and operational sustainability, establishing rapid scale while maintaining a healthy balance sheet and strong unit economics,” said Sid Talwar, Partner, Lightbox.