Darwinbox, which operates a cloud-based human resource management platform, has raised $15 million in a new financing round as the Indian startup looks to further expand in the country and Southeast Asian markets.
The new round — a Series C — for the Hyderabad-headquartered startup was led by Salesforce Ventures, the venture arm of the American enterprise giant. This is Salesforce Ventures’ one of rare investments in India. Existing investors including Lightspeed India and Sequoia Capital India also participated in the round, which brings the five-year old startup’s raise to-date to about $35 million.
Over 500 firms including — Tokopedia, Indorama, JG Summit Group, Zilingo, Zalora, Fave, Adani, Mahindra, Kotak, TVS, National Stock Exchange, Ujjivan Small Finance Bank, Dr.Reddy’s, Nivea, Puma, Swiggy, Bigbasket — use Darwinbox’s HR platform to provide more than a million employees of theirs with a range of features including insurance and early salary as loans in 60 nations, up from about 200 firms across 50 nations in late 2019, said Chaitanya Peddi, co-founder of Darwinbox, in an interview with TechCrunch.
Peddi said the startup has always looked up to Salesforce for inspiration, and investment from the enterprise giant is “nothing sort of a child receiving validation from their father,” he said.
The fundraise caps the most successful year for the startup that started with uncertainty as the coronavirus spread across Asian nations. The startup initially took a hit as its customers scrambled to navigate through the global pandemic, but the last two quarters have been its best to date, said Peddi.
Overall, the startup’s revenue has ballooned by 300% since September 2019, when it last raised money, he said. “In HR tech and SaaS space, we are now only behind SAP and Oracle in India in terms of revenue,” he said.
Dev Khare, a partner at Lightspeed India, an early backer of the startup, said that Darwinbox has become the preferred human capital management solution for Asian conglomerates, governments, and high-growth businesses and multi-national corporations operating in Asia as they witness digital transformation.
Darwinbox’s platform is built to take care of the entire “hiring to retiring” cycle needs of employees. It handles onboarding of new hires, keeps a tab on their performance, monitors attrition rate, and provides an ongoing feedback loop.
It also provides its customers with a social network for their employees to remain connected with one another and an AI assistant to apply for a leave or set up meetings with quick voice commands from their phones.
Peddi said the startup will deploy the fresh capital to expand to several more countries, especially in more emerging markets in the Middle East Asia and Africa, and broaden its offerings. “We will be leveraging the power of our platform to do a lot more. We are a product-led firm and our focus will remain on innovation in that space,” he said. The startup is also open to exploring opportunities to acquire smaller firms for inorganic growth, he said.
“India is home to one of the world’s youngest population, and by 2050, it is expected to account for over 18% of the global working age population,” said Arundhati Bhattacharya, Chairperson and CEO, Salesforce India, in a statement. “This makes technology platforms like Darwinbox, that focuses on workforces, incredibly important. I’m proud that Salesforce is supporting Darwinbox on their journey as they continue to grow and innovate in this space.”
Alex Kayyal, partner and head of international at Salesforce Ventures, told TechCrunch in an interview that the firm helps its partners in a number of ways, including exposing them to the firm’s customers, executives and their networks, and helping startups scale their business.
“We have one of the most innovative and disruptive customer bases that are looking for cloud solutions and digital transformation. So the opportunity to expose companies like Darwinbox to our customer base is something we get really excited about,” said Kayyal. Salesforce Ventures is exploring more investment opportunities in India, he said.