Evoke International on expansion mode mulls IPO
Since 2008, Evoke International has built digital platforms and mobile applications for leading telecommunication service providers. Founding CEO and Director, Lahiru Wickramasinghe, and Director, Rajiv Gunawardena, discusses Evoke International’s future including improving growth prospects, an imminent listing on the Colombo Stock Exchange and overseas expansion.
Can you tell us how Evoke started, and how the company has evolved so far?
Lahiru: I started the company in 2008 when smartphones began entering the Sri Lankan market. Back then, mobile networks were selling popular songs for people to use as call music which continues to be popular among subscribers. There was one company distributing local music among the telecom operators, and I quickly realised that the songwriters and singers did not get anything out of this. Evoke was started with a different model where we would acquire the digital rights and share the revenue with the artistes. Within a year, we acquired more than half the call music market share. With smartphone penetration growing and mobile network infrastructure upgrading to 3G and then 4G, there was an opportunity for us to become a formidable player in the OTT (over-the-top) space.
What does Evoke do? Can you tell us about your products and services?
Lahiru: Mobile operators invest a lot on the infrastructure for voice and data which are essentially dumb pipes. They need OTT solutions like WhatsApp, Netflix, and others to drive revenue through data usage. Evoke provided Sri Lanka’s first OTT platform with the development of a movie platform named Film Hall. Our software engineers also developed Movie Box, one of the most downloaded apps in the country.
While managing digital media platforms and developing mobile apps, we have evolved since then to become an end-to-end digital service provider, OTT platform provider and content aggregator. Our clients include all the telecommunication service providers and entertainment based companies.
We have a team of highly motivated and talented individuals specialising in software development, design, media production and editing. Our digital and marketing teams are highly skilled and experienced in executing digital strategies for specific businesses while opening up opportunities for our clients. Our App and WAP (wireless application protocols) products are based on trending frontend designing and web architecture for seamless experiences on wireless smart devices. For the services sector, we develop voice and interactive voice response solutions which include astrology readings, entertainment, quizzes and much more.
Content aggregation is big business for us. We have eight years longstanding partnership with Hungama, one of South Asia’s largest digital entertainment platform. All the latest movies from Hollywood, Bollywood and multiple other languages along with new songs are all available on their release dates for Sri Lankan smartphone users, distributed by Hungama on mobile apps developed by Evoke. We have a recording label, Evoke Music, which produces and distributes super Sri Lankan hits on both audio and video format. We also operate SMS Centre services and excel at innovating highly scalable and cost-effective solutions for segmented targeting.
Our suite of products and services have over 1.8 million unique subscribers, and we generate over 13 million callouts a month. Evoke’s ad platforms get six million hits a month, and the number of mobile transactions averages 1.4 million monthly.
Rajiv: Our people are the bedrock of Evoke’s success. The senior members of the team have been with us since inception. Evoke was conceived with limited capital and has funded its growth without having to borrow. We have a lean business model and maintain financial discipline so we can deliver meaningful returns to our stakeholders while growing the business and investing in our people. Once we perfected building entertainment platforms for telecom operators, we decided to launch our own app called EvoPlay which provides the latest local and global hits, movies and teledramas. It gives us better control over the product and maximises returns. It is not only the latest Sinhala and Tamil content but subscribers to our mobile streaming service can consume local television content live as well.
Our target market has been the lower and middle-income segment who have benefitted from falling smartphone costs and telco rates. Since inception, revenue and profitability have grown 30-40% annually while our unique subscriber base has expanded 15-20% each year. We expect the subscriber base to increase by 50% in 2020 as more people opt for digital entertainment due to the Covid-19 pandemic. Evoke Music videos reach 2.4 million people each year. Our YouTube channel subscriber base has grown 35% annually with views increasing by 50%.
What are Evoke’s prospects in a post-Covid environment?
Rajiv: We are a Covid-resilient company, and we are rolling out our expansion plans. We recently introduced MyBuddies app, the Sri Lankan version of Instagram which connects audiences to Sri Lankan celebrities. It’s a big hit and now we are developing one for the Bangladeshi market. We are actively exploring opportunities to take our products globally, there is a sizable Sri Lankan Diaspora around the world yearning for local music, movies and teledramas, from all-time favourites to the very latest. The entertainment industry has matured over the years in terms of production quality and audience engagement, and we see demand growing. Right now, Evoke reaches 1.8 million people, and this can expand to around 5-6 million over the next five years. To finance this growth, and also to share more widely the impressive returns we have consistently delivered, we decided to take the company public with a listing on the Colombo Stock Exchange. It could be the first IPO since the Covid-19 outbreak.
I believe that the time has come for Evoke to expand its wings and soar.There is a tremendous opportunity for growth because Sri Lanka has room to grow internet and smartphone penetration. In 2019, internet penetration was at 61.5% (CBSL 2019 Annual Report) while fixed-line reach was 11% of the population. While mobile phone penetration was at 151% of the population, less than half use a smartphone (LIRNEasia 2019). The telecommunication service providers will need to add more OTT services to supplement their revenue streams because there’s limited space to manoeuvre when it comes to voice and data tariffs. So, there will always be opportunities for us to grow market share, innovate and always do new things.
Dr. Jehan Perera - Executive Director National Peace Council