Salesforce’s Indian rival Freshworks valued at $10 billion in Wall Street IPO
By Diksha Madhok, CNN Business
An Indian company that wants to rival Salesforce is launching an initial public offering in the United States.
Freshworks said this week that it has priced 28.5 million shares of common stock at $36 each, raising a little over $1 billion in its IPO in New York. That values the company at more than $10 billion.
The company expects its shares to start trading on the Nasdaq on Wednesday under the stock ticker FRSH.
The company is India’s best known software-as-a-service, or SaaS, firm, and it joins a string of other high-profile startups from the country that have gone public or announced intentions to go public this year. Freshworks was founded in Chennai in 2010, and it provides software to help businesses manage relations with their customers.
Freshworks is now headquartered in San Mateo, California, but the majority of its engineering staff is still based in Chennai, in southern India.
SaaS companies provide web-based applications that take care of everything from how secure the software is to how well it performs. Some of the world’s most well-known SaaS companies include Zoom, SAP Concur and Salesforce, the American behemoth that owns workplace messaging app Slack.
Investors have begun to pump money into Indian SaaS companies, as they believe that they could be the country’s next big thing in tech.
The Indian SaaS industry could be worth $1 trillion in value by 2030 and create nearly half a million new jobs, according to a recent report compiled by consulting firm McKinsey & Co. and SaaSBoomi, a community of industry leaders.
The majority of Indian SaaS companies serve international clients — Freshworks’ first client was in Australia. Investors also count as a big plus the country’s vast pool of English-speaking developers, and the relatively low cost of hiring them.
An Indian ‘pioneer’
Freshworks is India’s oldest unicorn — a term for startups valued at more than $1 billion — in the SaaS sector. The company has raised funds from investors such as Tiger Global and Accel, and has more than 50,000 customers.
“We weren’t founded in Silicon Valley. We didn’t target large enterprises. We didn’t have access to a been-there-done-that talent pool,” said Girish Mathrubootham, CEO and founder of Freshworks, in the company’s IPO filing. “I’m very proud that Freshworks is a pioneer of Indian entrepreneurship, and of our ability to blend the art of Indian design with the science of Silicon Valley scaling.”
This is turning out to be a landmark year for India’s tech unicorns. None had ever gone public before.
Food delivery company Zomato made its debut in Mumbai earlier this year. And in June, fintech giant Paytm filed for India’s biggest tech IPO on record.
Flipkart, the Indian e-commerce firm controlled by Walmart, is also planning to list in the United States as soon as the fourth quarter of 2021, according to media reports.
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