YouTube is closing live social commerce app Simsim less than two years after buying the Indian startup. However, the video sharing platform insists it is committed to building "a seamless shopping experience for viewers and supporting creators' businesses.".

The idea behind Simsim was to help India's small businesses pivot towards e-commerce with the power of video and creators' popularity. A local businessperson, an influencer, and a customer all got connected via the now-eponymous startup app.

YouTube bought Simsim mid-2021 for over $70 million. YouTube said, at the time, acquiring Simsim is designed to enable the video streaming giant to assist small businesses and retailers in India to gain access to new customers in even more powerful ways.

The largest market for YouTube is in South Asia, with more than 450 million users. It views India as a testbed, like YouTube Go and Shorts. Its acquisition of Simsim came at a moment when YouTube was only just beginning to explore means to expand the video platform into an e-commerce engine.

India, the thesis pertains to this: "Micro-influencers are better at creating a niche audience (growth), entertaining experiences (retention), building trust (value realized), and personalizing messages (conversion)", Rohan Malhotra of Good Capital, who have backed Meesho as well as Simsim so far, told.

As he explained in earlier chat with TechCrunch, "Consumer social platforms (Facebook, YouTube, Instagram, etc.) cannot meaningfully monetise via advertising-financed models in India; this unlocks the opportunity for more deeply integrated transactional platforms. New internet users in India need an interactive seller-led experience to replicate the offline e-commerce experience this market is used to,". 

The time is not yet ripe for the thesis. Facebook closed its live shopping feature last year as it shifted focus to Reels. But no one is so unaccustomed. Amazon, which acquired Indian social commerce startup GlowRoad last year, has just launched QVC-style livestream shopping in the country.

To do that, the retail group created Amazon Live, which brings an army of over 150 creators to host livestreams and plug products in the videos. The idea is that influencers, with already large followings, will drive their fans to the shopping app and influence them into buying products. They get a cut each time they are able to make a sale.

YouTube's not entirely abandoning the category, however. The company said in a statement Thursday that it will "be working with creators to introduce more monetization opportunities for creators through an affiliate program and more shopping features across long-form videos, Shorts, and livestreams on YouTube in 2023.".