The CEO of Freshworks had an idea 10 years ago when his TV was damaged by movers. Now his startup is worth $3.5 billion and is threatening Salesforce.
- Freshwork's CEO Girish Mathrubootham sees a massive opportunity to disrupt the customer engagement market, and has created a company that provides software for all the interactions a company might have with a customer.
- "Customers are used to having a platform and then integrating all these tools. So today if you walk into any company, the CRM stack is unwieldy...so what we believe is the exciting opportunity of the future is building the CRM platform of the future," Mathrubootham told Business Insider.
- The company just raised $150 million in Series H funding, in a round led by Accel, Sequoia, and CapitalG, to continue growing.
- Sameer Gandhi, a partner at Accel said Freshworks offers a unique product that helps businesses manage every step of interaction with a customer in one platform, as opposed to many, and offers a use-friendly way to do so.
- Freshworks has 250,000 customers globally and many are small to medium sized businesses or mid-market businesses.
- Click here for more BI Prime stories.
In 2010, Freshwork's CEO Girish Mathrubootham saw a massive opportunity to change the way companies do customer support. He was moving back to India from Austin, Texas in 2009, where he had been working as an engineer for Zoho. During the move his TV was damaged by the moving company, and he had no luck getting a response or solution from the moving company.
At that point he said he got frustrated and shared his experience in an online forum. That post changed everything. He noticed how engaged the online community was in solving the issue - enough that the moving company eventually reimbursed him for his damaged TV.
"That's when I realized something was changing in the world of customer support, where I realized that as a customer I had a newfound power to take on a company," Mathrubootham said. He realized he had to capitalize on this opportunity and started a customer support company called Freshdesk in 2010.
In the 10 years since, Mathrubootham has grown the company from its customer support focus, which India is a hub for, into a platform that provides software to help manage every interaction a customer has with a company, from marketing to customer support. The company is now called Freshworks and is headquartered in San Mateo, California, although the majority of its employees are still based in India, with offices in 10 other locations, including London, Berlin, and Sydney.
His goal with Freshworks is to create a new customer relationship management platform that includes everything needed for a company to interact with a customer from beginning to end. This includes marketing and sales automation, messaging and email campaign management, among other things, to help manage relationships with customers.
He said he saw a need for a streamlined, user-friendly tool for companies to be able to do this that didn't yet exist in the market.
"Customers are used to having a platform and then integrating all these tools. So today if you walk into any company, the CRM stack is unwieldy...so what we believe is the exciting opportunity of the future is building the CRM platform of the future," Mathrubootham told Business Insider.
The company just raised $150 million in Series H funding, led by existing investors Sequoia Capital, CapitalG, and Accel, to continue growing. This new funding gives Freshworks a valuation of $3.5 billion, as it targets a potential IPO next year, although it doesn't have a set timeline yet, Mathrubootham said. Accel's India arm gave Freshworks its seed funding of $1 million in 2011.
Salesforce is a giant, but there's room for competition
In the CRM market, Salesforce is the big behemoth, but Mathrubootham thinks there is room to disrupt. "It's been almost 20 years since anything new happened in CRM, so there is room for a technology refresh," he said. He added that he thinks there is a better solution where customers don't need to integrate services on top of a "bare bones" CRM platform.
Sameer Gandhi, a partner at Accel who led this funding round, agreed, and said that he thinks the market is big enough for many different options, and it is not a "winner take all" market.
"We really think Freshworks can be incredibly successful in this market, and it doesn't have to be at the expense of a Salesforce. Frankly there's a lot of other vendors out there too," Gandhi told Business Insider.
He said what drew Accel to Freshworks was that it was doing something unique in the CRM space. Mathrubootham had created a tool that was simple and intuitive to use, in a way that other products in the sector weren't. And the product is well targeted toward the type of small to medium sized businesses that mainly use the platform.
"It's a really unique approach that you'd have to stitch together with a bunch of different kinds of solutions in other cases," Gandhi said.
Freshworks has 250,000 customers globally. Many of these are small to medium sized businesses or mid-market businesses. However, Gandhi said the product is also popular with smaller groups within large businesses. Some larger companies that use the product are Sotheby's, Bridgestone, DISH, Sling, and Vonage.
Mathrubootham said the company plans to use the money raised in this round to continue growing before looking towards an IPO.
- Top 10 must-visit destinations in South Africa
- Indian markets continue record run, Sensex scales 69K peak as power, bank shares advance
- Stock markets continue record run, Sensex scales 69K peak as power, bank shares advance
- Icy pebbles may be carrying water to developing planets across the cosmos!
- With $500 billion in reserves, LIC is the world’s fourth largest insurer