Baillie Gifford Funds Slash the Value of Dailyhunt Parent VerSe by Up to 80%, Implying a $576 Million Valuation Against a $5 Billion Peak

In 2022, VerSe Innovation was one of the brightest names in India's startup boom, raising $805 million at a reported $5 billion valuation. Four years later, one of its high-profile foreign investors values the company at a fraction of that figure.

Two investment trusts managed by Edinburgh-based Baillie Gifford have sharply reduced the value of their holdings in VerSe, the Bengaluru-based parent of local-language news app Dailyhunt and short-video app Josh, according to Inc42 and the Economic Times on October 27.

The numbers

The Schiehallion Fund valued its VerSe holding at $7.47 million as of August 2026, down 78.2% from $34.31 million in January 2025.

The Pacific Horizon Investment Trust valued its holding at £4.08 million as of July 2026, down 51.4% from £8.39 million a year earlier and 80.3% from £20.69 million in July 2024.

According to the Economic Times, Schiehallion's stake represents 1.3% of VerSe, which would imply a company valuation of about $576 million. That would be nearly 90% below the $5 billion valuation at which VerSe raised capital in April 2022.

VerSe pushes back

VerSe has disputed the lower valuation. The company said the assessment did not represent its overall valuation and that other investors still value it at around $5 billion, according to Inc42. It also noted that it had not conducted a price-discovery funding round since April 2022.

Valuation marks by investment funds reflect each fund's own methodology and assessment, rather than a transaction in which shares changed hands at a new price. Different investors can, and often do, value the same private company very differently.

A history of markdowns

This is not the first time VerSe's valuation has come under scrutiny. In August 2024, TechCrunch reported that wealth manager 360 ONE valued VerSe at about $2.9 billion, roughly 42% below its 2022 level. Schiehallion's earlier interim report, covering the six months to July 2025, cited declining revenue as the reason for its markdown at the time.

The financial picture

VerSe's operating revenue rose 88% to ₹1,930 crore in the financial year ended March 2025, from ₹1,029 crore a year earlier, according to Inc42. Excluding acquisitions, operating revenue grew 33% to ₹1,373 crore. EBITDA burn, excluding non-cash expenses, narrowed 20% to ₹738 crore from ₹920 crore.

The figures show a business that is growing and reducing losses, but still burning substantial cash, a combination that has made investors more cautious in the current funding environment.

A star of the boom

VerSe has raised nearly $1.7 billion from investors including Google, Microsoft, Peak XV Partners, Ontario Teachers' Pension Plan, Canada Pension Plan Investment Board and Luxor Capital.

Its rise was driven by India's local-language internet boom, as hundreds of millions of new users came online using smartphones and consumed content in Hindi, Tamil, Telugu, Bengali and other languages. Dailyhunt became one of India's largest news aggregation apps, while Josh grew rapidly after India banned TikTok in 2020, creating an opening for domestic short-video platforms.

The short-video battle

The short-video market has been intensely competitive. After the TikTok ban, a wave of Indian apps, including Josh, Moj and MX TakaTak, raced to capture users, spending heavily on creators and marketing. Instagram Reels and YouTube Shorts, backed by global platforms with deep resources, have since captured a large share of the market, making it harder for independent apps to monetise.

Advertising revenue in digital media is also concentrated among large platforms, putting pressure on smaller players.

The broader reset

VerSe's markdown reflects a broader reset in valuations of Indian startups that raised money at high prices during the 2021-22 boom. Several companies have seen their valuations cut by investors, or have raised new funding at lower valuations, known as down rounds.

Foreign investment trusts such as Baillie Gifford's, which hold stakes in private companies, regularly revalue their holdings and disclose the results, offering a window into how professional investors assess startups between funding rounds.

What it means for the ecosystem

For India's startup ecosystem, the gap between VerSe's own view of its value and the marks used by some investors highlights the uncertainty that surrounds private company valuations. Until a company raises a new round or lists on the stock market, its valuation remains open to debate.

How funds value private companies

Investment trusts that hold unlisted shares must value them regularly, typically using methods such as comparisons with listed peers, recent funding rounds, discounted cash flow analysis and the company's financial performance. Valuations can change significantly even without a new funding round, as market conditions and company performance evolve.

Baillie Gifford's trusts have been among the most active foreign investors in Indian and global startups, and their periodic disclosures are closely watched as indicators of how private valuations are shifting. The firm's markdowns of other Indian holdings in recent years have similarly drawn attention.

The local-language bet

VerSe's original thesis remains compelling: hundreds of millions of Indians prefer to consume content in their own languages, and they represent a large audience for news, entertainment and commerce. The challenge has been converting that audience into profitable revenue, as advertising rates for local-language content are lower and competition from global platforms is fierce. VerSe has diversified into areas such as advertising technology and AI-powered content to address that challenge.

Lessons for founders

For founders, VerSe's experience illustrates the risks of raising capital at peak valuations. A high valuation brings prestige and capital, but it also sets expectations that can be hard to meet when market conditions change. Companies that raised at high valuations in 2021 and 2022 have faced difficult choices, including accepting down rounds, delaying fundraising or relying on internal cash generation. Many investors now advise founders to prioritise sustainable growth and efficient use of capital over headline valuations.

What comes next

VerSe will need to show continued revenue growth and a path to profitability to support its claimed valuation. A new funding round or a public listing would provide a clearer market price. Until then, investor marks such as Baillie Gifford's will continue to shape perceptions of one of the best-known companies from India's local-language internet boom. Other foreign funds that hold stakes in VerSe will also publish valuations in their regular reports, and those disclosures will add to the picture of how investors view the company as it navigates a more demanding funding environment for India's consumer internet businesses.