Software-as-a-service (SaaS) startup WebEngage, which helps companies with customer engagement and retention, has raised $20 million in Series B funding as it looks to expand its footprint amid growing adoption.
The financing round was led by Singularity Growth Opportunities Fund and SWC Global. It also saw participation from existing investors India Quotient, Blume Ventures and IAN Fund.
A few family offices including Unmaj Corporation and NB Ventures as well as investors such as TVS Capital chairman Gopal Srinivasan and BharatPe co-founder Shashwat Nakrani also took part in the round.
With this, WebEngage has raised a total of around $26 million to date. The company plans to use the funds to improve its product and make it more comprehensive, covering the entire spectrum of user retention.
The proceeds will also be used to expand into new markets as well as go deeper in its existing markets such as India, the Middle East, Latin America and Southeast Asia and hire more local talent, WebEngage CEO Avlesh Singh told Moneycontrol on August 2.
"The idea is to also build some of these inorganically and look for more capabilities that are available to add to our portfolio in the form of acquisitions and make it a comprehensive toolkit for our customers" he said.
Founded in 2011 by Singh and Ankit Utreja, WebEngage offers companies a suite of solutions, including a customer data and analytics platform, an omnichannel campaign manager and a web and app personalisation engine to help them retain customers and boost their revenue from existing customers.
"WebEngage's comprehensive customer engagement platform truly empowers companies to listen to their customers better, to understand their behaviour deeply by smartly segmenting customers, and to act on that knowledge in a way that is personal," said Apurva Patel, Managing Partner of Singularity Growth Opportunities Fund.
The company claims to have reached a $20 million annual revenue run rate, registering a 100 percent growth year-on-year.
Singh said that while revenues suffered a major disruption in the initial months of the Covid-19 pandemic, there has been a clear acceleration across enterprises to go more digital, which would not have happened or taken much longer otherwise.
The startup claims to be working with more than 600 customers across the world including internet businesses such as Unacademy, Myntra, Pluralsight, Pepperfry, and Junglee Games as well as enterprises such as Adani Group, Unilever, L'Oréal, Bajaj Auto, IKEA, Grasim Industries and Go First.
Singh said internet businesses are 80 percent of its customers, while the remaining 20 percent are enterprises.
In terms of geography, India accounts for 60 percent of WebEngage's business, followed by the Middle East region that contributes 25 percent, Europe that contributes 10 percent and the remaining 5 percent is spread across Latin America and Southeast Asia.
Singh, however, said the mix will likely change as they expand to newer markets."Our product category is such that it is a necessary evil since retention is not something that you can shy away from. It is a second order problem when you have tons of money since you continue to acquire new folks all the time but especially in times like these, it cannot wait and becomes a first order problem" Singh said.
Privacy shift gains
The company will also likely benefit from Apple's recent iOS privacy changes that require apps to get user permission to track their behaviour across other apps and websites.
Google also intends to do something similar with the Privacy Sandbox initiative, though it recently delayed phasing out third-party tracking cookies from Chrome to late 2024.
"When it comes into effect, the efficacy of what you are able to do on Google and Facebook's ad networks today because of third-party tracking will go down significantly, then the next best bet for you is first-party data tracking, which is all the data that you're sitting with (about) the user," he said.Anand Lunia, founding partner at India Quotient, said, "We have always believed that the best teams build the best product and in the long run, it's the best product that wins. This is our fourth investment in WebEngage and we will continue to back them as far as we can. WebEngage also demonstrates our belief that companies that win SaaS in India can go global and repeat their performance."