Fractal Analytics raises $100 million from Malaysian sovereign wealth fund Khazanah
The investment will value the US and India-based company at close to $300 million (Rs 2,000 crore), according to a source directly familiar with the development.
The investment will value the US and India-based company at close to $300 million (Rs 2,000 crore), according to a source directly familiar with the development, as the company is looking to embark on an aggressive inorganic strategy.
Fractal Analytics said that the funding will be used to accelerate its growth, investing in areas like artificial intelligence (AI) to snag Fortune 500 clients. It counts multi-nationals like Franklin Templeton Investments, P&G, Kimberly Clark, Microsoft and Philips as its clients.
Global revenue in the business intelligence and analytics is expected to reach $16.9 billion in 2016, an increase of 5.2% from 2015, according to the latest forecast from Gartner. “There is a revolution underway in advanced analytics, deep learning and visual storytelling. Analytics as we define it may get transformed and the investment from Khazanah will help us invest further in our AI & deep learning-based software stack,” said Srikanth Velamakanni, cofounder of Fractal Analytics. He declined to comment on the valuation.
The firm has developed several AI-based analytics product, including one in the healthcare space. It has also launched AI-based personal assistant called Cuddle, which helps enterprises and executives understand what they need to know right now for making decisions.
SHOPPING SPREE Besides expansion and product, the large financing round is also expected to be used for acquisitions. Fractal has already closed two acquisitions in 2015 - Imagna Analytics, an artificial intelligence startup and Mobius Innovations, a mobile-based contextaware big data startup. Mobius was launched by Fractal’s cofounder Nirmal Palaparthi in 2012.
Fractal Analytics currently has five acquisitions in the pipeline that it is evaluating. “We will look to acquire companies for the IP that they bring in clients who we don’t have right now,” said Velamakanni, adding that it only looks to onboard clients who either have revenues of over $10 billion, market capitalisation of over $20 billion or have over 30 million customers.
The company had raised $25 million from Boston-headquartered private equity firm TA Associates in 2013 followed by a stake purchase by Canada's Aimia, one of world's largest loyalty management firm in 2014. Fractal also counts Gulu Mirchandani, chairman of Onida Group and his son and venture capitalist Sasha Mirchandani as early investors.
Fractal Analytics was founded around the first dotcom bubble 2000, and for the first 10 years found it tough to sell analytics to clients in India but has been growing at 60% compounded annual growth rate over last six years. The company now has over 13 offices, with major centers in Mumbai and San Francisco. Fractal founders include IIM-Ahmedabad post graduates Velamakanni, Palaparthi and Pranay Agrawal. Two other cofounders — RK Reddy and Pradeep Suryanarayan — left after a legal dispute erupted between the founders in 2007.