Freshworks valuation soars to $3.5 bn with funding led by Sequoia, Accel and CapitalG
San Mateo, California headquartered customer engagement software company Freshworks has raised $150 million in its largest funding round since inception. The growth round was led by returning investors Sequoia Capital, Accel and CapitalG.
The round values the Chennai-born SaaS unicorn at $3.5 billion, post-money, and is expected to close by the end of the year, pending standard closing conditions and regulatory approvals, including US antitrust regulatory clearances, the company said in a statement.
The company will use the $150 million to further grow its global market presence and invest in its integrated SaaS platform.
The latest infusion takes the total capital raised by the decade-old company so far to nearly $400 million, according to data compiled by VCCEdge. Last year, it raised $100 million in a growth round led by Accel and Sequoia, entering the unicorn club of private companies valued at $1 billion or more.
“Since Freshworks’ founding, we have been at the forefront of democratizing software for the entire organization and we’re continuing that tradition by using the most advanced cloud technologies to ensure that software delivers for the entire organization and puts the ‘customer’ back into CRM,” Freshworks founder and CEO Girish Mathrubootham said.
Along with the funding, the company announced the launch of Customer-for-Life Cloud, a common data platform across all its customer engagement products to unify customer information from marketing, sales, support, and customer success. “The Customer-for-Life Cloud enables businesses to sharpen their customer understanding to better predict and enable success, displacing dismal legacy SaaS solutions that have over-promised and underdelivered with eye-popping regularity,” Mathrubootham said.
Mathrubootham founded Freshworks with Shan Krishnasamy in 2010. Known as Freshdesk at the time, the company raised $1 million in its first institutional funding round from Accel in December 2011. The following year, New York headquartered alternative investments firm Tiger Global Management joined Accel to invest $5 million. CapitalG, Alphabet’s growth investment fund, entered the company in 2014 when it raised a $31 million round. In late 2016, Sequoia led a $55 million round in the company.
“Freshworks is unique in delivering software that works for end users across the organization. There’s a reason Sequoia’s teams across India and the US have each independently decided to double down on Freshworks as it expands its footprint from India to global markets,” Sequoia India managing director Mohit Bhatnagar said.
The SaaS provider offers cloud-based solutions for customer support, call centre operations, internal collaborations and marketing automation for enterprises across several sectors. Freshdesk, its flagship product, allows companies to conduct customer service operations from remote locations.
The company, which started its India operations with offices in Chennai and Bengaluru and employs more than 2,500 people globally, opened its third office in Hyderabad recently. It also set up its second office in the Australia-New Zealand region with an office in Melbourne. Other global office locations include Paris, France and Utrecht, Netherlands.
Acquisitions have been an important part of the company’s growth strategy. It has made ten known acquisitions to date. In May this year, it announced its tenth acquisition when it bought Silicon Valley-headquartered Natero Inc, an artificial intelligence (AI)-powered platform that provides customer success solutions.
Other acquisitions include marketing software startup Zarget, chatbot venture Joe Hukum; SaaS startup Pipemonk; social chat platform Chatimity; social media analytics venture Airwoot; visual collaboration platform Framebench; in-app customer support startup Konotor; social recommendation platform Frilp; and video chat software 1Click.io.
Freshworks competes with homegrown SaaS firm Zoho and US-based Salesforce, among others.