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Screen shot from SmartNews.com

SmartNews, the Japanese news discovery app that has amassed 20 million global monthly active users, has raised $28 million in its latest funding round, bringing the company's valuation to $1.1 billion, executives tell Axios.

Why it matters: It's notable that in today's bleak news market where U.S. tech giants like Google and Facebook dominate most news referral traffic online, a Japanese-based firm has been able to gain traction. SmartNews is one of the few news-related startups to achieve "unicorn" status, or a valuation of over $1 billion, in years.

Details: The round, which is the company's Series E round, is being led Japan Post Capital Co., Ltd., a Japanese private equity fund management firm. To date, the company has raised $116 million and brings in revenue of "9 figures" annually, according to SmartNews head of U.S. marketing Fabien-Pierre Nicolas. 

  • While the company does hire editors to ensure quality control on the platform, most of the money raised will be going toward technology development, says Nicolas.
  • SmartNews is looking to hire more engineers to bolster its U.S. product, as well as to penetrate other markets with research and development centers, like Shanghai.

Between the lines: The company is currently the largest news aggregation service in Japan, but has been rapidly growing its U.S. footprint.

  • Axios reported in February that SmartNews had quadrupled its U.S. audience over the past 2 years and now drives more traffic to publishers than Apple News, according to traffic news referral service Parse.ly.
  • SmartNews is most similar in product to Apple News in the U.S., but it's free instead of charging users a monthly subscription. The company makes the majority of its revenue from advertising, and executives say they have no plans to turn it into a subscription product.

By the numbers: According to Nicolas, the company had 10 million monthly active users of its app last July and it has doubled that number to 20 million in roughly a year.

  • It works with roughly 400 U.S.-based news and information publishers, a few of which have told Axios that the traffic bumps from SmartNews are significant, but the revenue sharing operation could be stronger.
  • Nicolas says that it works with about 400 news partners in Japan as well, although they count publishers a bit differently in that market.

The big picture: SmartNews is the latest Asian news aggregation app to make it big.

  • Toutiao, which is owned by TikTok's parent company ByteDance, raised $2 billion in funds at an over $20 billion valuation in 2017. It reportedly has more than 200 million daily active users.
  • Qutoutiao, the 3-year-old news and video aggregation startup backed by Tencent, recently announced that it is receiving a $171 million convertible loan from Chinese tech behemoth Alibaba. The company went public in the U.S. last year with roughly 50 million monthly active users and a market value of $2.1 billion.
  • DailyHunt, NewsPoint and others have also gained traction in recent years in India. DailyHunt has raised $98 million to date.

Go deeper:

Go deeper

California governor declares drought emergency for entire state

California Gov. Gavin Newsom speakinng to reporters in Los Angeles in September. Photo: Allen J. Schaben/Los Angeles Times via Getty Images

California Gov. Gavin Newsom (D) extended a drought emergency declaration to cover the entire state on Tuesday.

Why it matters: "California is experiencing its worst drought since the late 1800s, as measured by both lack of precipitation and high temperatures," per a statement from the governor's office. This past August was the driest and hottest one on record, "and the water year that ended last month was the second driest on record," the statement added.

Updated 2 hours ago - World

Reports: Brazil leader to be accused of crimes against humanity over COVID

Brazilian President Jair Bolsonaro. Photo: Andressa Anholete/Bloomberg via Getty Images

A Brazilian Senate panel will recommend President Jair Bolsonaro be charged with "crimes against humanity," alleging his COVID-19 pandemic response led to hundreds of thousands of deaths, per the New York Times and the Washington Post.

The latest: The lawmakers initially said Bolsonaro should be charged with mass homicide and genocide, but lawmakers updated the report to replace these recommendations with the new charge, its lead author, Sen. Renan Calheiros, told the NYT.

Updated 5 hours ago - World

North Korea claims latest missile test new weapon launched from submarine

North Korean state media claims the country's military fired this missile on Tuesday. Photo: Korean Central News Agency

North Korean state media announced that a detected ballistic missile launch off its east coast on Tuesday was a newly developed weapon test-fired from a submarine.

Why it matters: Pyongyang's latest in a series of recent missile launches into the sea happened hours after U.S. officials emphasized their commitment to restart negotiations on North Korea's nuclear weapons program, which have stalled since talks broke down during the Trump administration, AP notes.

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