How Paytm-backed Rooter’s pivot to game streaming turned its fortunes, making it India’s top sports app

Rooter was founded in 2016 by Piyush Kumar and Dipesh Agarwal as a social network and online community for sports fans. Similar to Fancred and Chat Sports in the US, and FanCode in India.

Its proposition was simple: It would provide a fan engagement platform around live-action sports, where users could enjoy quizzes, real-time commentary, game scorecards, and other multimedia content around the event. 

“We had seen social platforms building communities. Sports could connect fans around players, clubs, leagues, etc. We wanted to disrupt sports content, and engage people in a live environment,” Piyush Kumar, Founder and CEO, Rooter tells YourStory.

 Between 2016 and 2019, the Delhi-based startup tried and tested multiple products and features to become a one-stop live sports content destination. Any user could go live during a match, conduct quizzes, live commentary, and share multimedia posts. 

The platform hit half a million MAUs and 200,000 DAUs around marquee cricket events like the World Cup and the IPL, with 15-17 minutes of average time spent per user. However, the peaks were few and far between. Rooter’s dependence on “external events” remained very high.

“We needed to have a product that could have relevance through the week, and not for sporadic or event-based usage. Even though cricket led to user retention, as soon as there was a break in matches, the numbers went down,” says Piyush.

 Rooter’s monthly retention rates hovered around 30-32 percent. “It wasn't scaling beyond that,” says the founder. “So, the challenge was how could we monetise the audience in the long term, given sports content was fragmented across mediums?” 

The problem was compounded in 2020 as the pandemic brought live sport to a screeching halt. There was no sporting action for months together.

Around April last year, Rooter started to pivot. “For us to scale, we needed to shift to a content stream that was not dependent on any other external factor,” states the founder.

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Pivot to game streaming

 By May, Rooter had pivoted from a fan engagement to a live game streaming platform. It also raised a $1.7 million Pre-Series A round led by Paytm, leAD Sports, and Founder Bank Capital. Anthill Ventures, Venture Catalysts, and other existing angels also participated in the round.

Prior to that, in 2019, Rooter had raised Rs 3.5 crore from leAD Sports Accelerator Programme (Adidas Family-backed fund). It also counts Bollywood actor Boman Irani and Telugu superstar Rana Daggubati among its early backers. 

Throwing light on the pivot, Piyush explains,

“We discovered that 85-90 percent of gaming content in the world is streaming. The remaining 10-15 percent is recorded video content. Since we already had the right tech team, we wanted to launch our own game-streaming platform.”

Rooter took 6-7 weeks to build out the in-house streaming tech without depending on any external partner. “That is why even after scaling the game streams 20-30X since May 2020, our cost of tech remains the same,” says the founder. 

The pivot to game streaming bore instant results. Within a month of its re-launch, Rooter’s retention rates improved to 40 percent.

It clocked 25,000-28,000 downloads per day at a Customer Acquisition Cost (CAC) of just Rs 2. In contrast, with sports content, its CAC stood at Rs 8-9 for only 5,000 installs a month.

Not only did the economics improve, even the user engagement did. “The gaming community gives you great retention when you have a sticky product. It means users are coming and finding something they can spend time on,” Piyush says.

He further explains, “We also gamified the experience of creating and consuming gaming content by giving targets to our users, so they could create daily streaks and habits. We are inspired by the CRED model. So, we will reward you for being a good user, and you can use those rewards to do a few other things on the platform.”

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Growth surge and capturing the market

Between August 2020 and 2021, Rooter has witnessed exponential growth, most of it coming in the last 7-8 months.

Rooter had 8.5 million MAUs at the end of August, growing from 1.7 million in January. Its DAUs have crossed 811,000 from about 481,500. The app has crossed 1.8 crore downloads, up from 30-40 lakh a year ago. Rooter is also the #1 sports app on Google Play Store.

The average time spent on the platform has shot up from 8.4 minutes to 26.5 minutes in the last eight months. Over two million hours of gaming content have been streamed on Rooter so far, up from 0.4 million a year ago. 

Rooter is seeing 80,000 livestreams on an average per day. “More than 855,000 unique users are creating gaming content on Rooter right now. We want to create one million streamers in the next 2-3 years,” reveals the founder.

Almost 60 percent of its users come from Tier II cities and beyond. The most engaged communities are around local language streamers in Tamil, Telugu, Hindi, Marathi. “English is only five percent. It’s an entirely regional play,” says Piyush. 

The startup also launched a Streamer Creator Programme to invite more gamers from all over India to stream their plays on Rooter as opposed to other platforms. 

While YouTube, the biggest game streaming platform in India, prioritises the top layer of gamers through its algorithms, Rooter wants to capture the middle and bottom layers of the game streaming market. 

The founder elaborates,

“The top 50 game streamers in India have been created on YouTube. They were the early movers who built their communities on YouTube. The key opportunity here is to do the TikTok for game streaming. TikTok unearthed new creators from the Tier II and Tier III markets. They spent two years getting one million content creators, and building tools to monetise them. We’re doing the same in the game streaming space. We want to create the next layer of streamers for whom Rooter is the first platform they get access to.”

At present, 4.3 percent of game streamers are earning on Rooter. It has partnered with 48 brands to unlock more monetisation opportunities for its creators. 

Rooter has also signed contracts with some of the top game streamers, including Gyan Gaming, PVS Gaming (#1 gaming content creator in South India), and others.

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Revenue and business model

Rooter believes that gaming is  a fairly “monetisable category”. It crossed revenues of Rs 1.4 crore in August, and is looking to hit an ARR of $5 million (Rs 32.5 crore) by FY22. Rooter also plans to double its MAUs to 16 million and downloads to 40 million.

The startup operates on a multi-stream revenue model, which includes advertising, performance marketing, in-app purchases, sponsored events, and creator subscriptions. 

Rooter earns the highest margins on performance marketing where it pushes downloads of other apps that advertise on its platform. “This has grown 3X, and we have been able to provide thousands of downloads to our partners,” Piyush reveals. 

Creator subscriptions is a newly launched revenue model where gamers can avail the best of tools and features to stream their gameplays and strengthen their communities.

In-app purchases, meanwhile, let users buy diamonds, coins, etc. from the Rooter marketplace and gift to streamers (similar to YouTube’s SuperChat feature).

The founder reckons monetisation is a critical piece in the game.

“You cannot push it to another year in a market like India,” he says. “If you see services like Twitch, Huya, DoYou, they have monetised 80 percent of their content through users,” he says.

Last year, Rooter entered into a strategic partnership with Paytm First Games where both companies will integrate each other’s content around esports and gaming.

Sudhanshu Gupta, COO, Paytm First Games, said in a statement, “We continue to grow our content offerings through gaming and the addition of Rooter's communities and user-generated content will further enhance the use cases on our platform. 

Rooter is also in the middle of closing a “pretty big” Series A round. (It has raised $5 million to date.) All the capital will go towards attracting creators to the platform. 

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YouTube Gaming and competitive landscape

YouTube Gaming, (YouTube’s game-streaming app), is Rooter’s biggest competitor.

This is because an overwhelming majority of gamers stream their live gameplays there. In 2020, over 100 billion hours of gaming content was streamed over YouTube via 40 million active gaming channels.

Rooter’s other global and local competitors include Twitch (owned by Amazon), NimoTV (overseas unit of Tencent-owned Huya), DouYu (top Chinese game streaming service), Loco (which pivoted from live quizzing to game streaming and raised funds from PUBG-maker Krafton), and Turnip (backed by Elevation Capital). 

These players constitute a global game streaming audience projected to grow from 729 million in 2021 to 920 million by 2024, according to game analytics provider Newzoo. In Southeast Asia alone, this market is growing at 14.8 percent annually. 

Piyush sums up by saying, “Our vision is to become the Hotstar of gaming content in India. We want to be the platform that everybody prefers to stream esports content on, and we will reach out to each and every gamer in the country.”