8/26/2015

HowentrepreneurGirishbuilt$94mlnworthFreshdeskinnotimeRediff.comBusiness

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Rediff.comBusinessHowentrepreneurGirishbuilt$94mlnworthFreshdeskinnotime

HowentrepreneurGirishbuilt$94mlnworthFreshdeskinnotime
August24,201510:27IST

Wayforward,FreshDesk'smanagementfeelsbuildingnewproducts,increasingsalesorscalingupoperationsisnot
toodifficultbutkeepingitsuniqueculturealiveevenasitexpandsis.

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Image:FreshDeskfounderGirishMathruboothamwithRBIgovernorRaghuramRajanatanevent.Photograph:
Courtesy,FreshDesk/Facebook

loudbasedcustomersupportfirmFreshdeskhasexpandeditsofficealmosteighttimessinceitstartedoperationsina
smallofficeinKeelkattalai,nearChennai,in2010.
Now,itsofficeatSPInfocityisspreadover60,000squarefeetreflectingitsgrowth.
The"softwareasaservice"companyisoneofthetopcustomersupportproductsfirmintheworld.Ithasraisedfundsfive
timesinfiveyears.
"Buttherearemilestogo,beforewechangethetechnologyenvironment"saidGirishMathrubootham,itsfounder.
ThecompanyofferssoftwareproductthroughCloudforbusinessestocommunicatewithcustomersata"freemium"price
companiesgeta"free"versioninitially,andthenpayFreshdeskastheyscaleup.
Itnowhas50,000customers,including3M,Honda,HugoBoss,UniversityofPennsylvania,UnicefandPetronas,in120
countries.

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HowentrepreneurGirishbuilt$94mlnworthFreshdeskinnotimeRediff.comBusiness

Image:ThepriceofFreshdesk'sproductsare5060percentlowerthanitscompetition,saysthecompany
website.Photograph:FreshDesk/Facebook
Factbox
Areaofbusiness:SoftwareFundsraised:SeriesA:$1millionfromAccelPartnersin2011SeriesB:$5millionfromTiger
GlobalManagementin2012SeriesC:$7millionfromAccelPartnersandTigerGlobalManagementin2013SeriesD:$31
millionfromAccelPartner,TigerGlobalandGoogleCapitalin2014SeriesE:$50millionfromexistinginvestors.
Thecompanyhasraised$94millionthroughfiveroundsoffundingstartingwith$1millionin2011to$50millionina
SeriesEroundfromTigerGlobal,GoogleCapitalandAccelPartnersinAprilthisyear.
Ithasalsocompleteditsfirstacquisition,1click.io,avideochatandcobrowsingplatformforanundisclosedamount.
Dawnofanew'desk'In2009,Mathrubootham,instrumentalindevelopingfourhelpdesksforZohoCorporation,returnedto
IndiaafterastintintheUS.
Inthemove,histelevisiongotdamagedandhedidnotgetaninsurancereimbursementafterrunningfrompillartopost.
Aftera28emailthreadandsixmonths,hepostedhisbitterexperienceinanonlineforumwhereexpatriatesfromUSlook
forsupportandheimmediatelygotaresponsefromthelogisticsfirm.Hiscomplaintwasclosedwithinaday.
ThisinspiredMathruboothamwhenhestartedanewcompany.

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HowentrepreneurGirishbuilt$94mlnworthFreshdeskinnotimeRediff.comBusiness

Image:FreshDeskhasgrownalmosteighttimesinnotimeunderGirishMathrubootham,thefirm'sfounder.
Photograph:Facebook/FreshDesk
HisotherinspirationwasanarticleonHackerNews,describinghowZendesk,aSanFranciscobasedsoftware
developmentcompany,wasraisingthepricesofitsproductsfreely,thankstomissingcompetition.Mathrubootham
launchedhiscompanybelievingintheneedforbettercustomersupport.
ShanKrishnasamy,whoworkedwithhimforeightyearsasatechnologyarchitect,joinedhimasacofounderandisnow
Freshdesk'schieftechnologyofficer.Withinsixmonths,FreshdeskwonMicrosoftBizSparkStartupChallengebagging
around$40,000.
ItlauncheditsfirstproductonJune7,2011asoftwarethatcustomerscoulddownloadonatrialbasisfor30daysandthen
buyiftheylikeit.
OnJune10,thefirstcustomerAtwellCollegeofAustraliacameonboard.
Afteratwohourtrial,theyboughttheproduct."Alltheinitialcustomerscamelikethat,"recallsMathrubootham.
"Wegot100customersin100days200in200."Freshdeskfounderswerealreadyintalkwithpotentialfunders.

Image:FreshDeskhas50,000customers,including3M,Honda,HugoBoss,UniversityofPennsylvania,Unicefand

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HowentrepreneurGirishbuilt$94mlnworthFreshdeskinnotimeRediff.comBusiness

Petronas,in120countries.Photograph:Courtesy,FreshDesk/Facebook
ThemoneyfromMicrosoftBisparkwasoverintwomonths.Thankstothegrowthinitsearlystage,Accelgavethefirm$1
millioninAugust2011.
Therewasnobusinessriskinthecompany.ShekharKirani,partner,AccelIndia,whoisalsointheboardofFreshdesk,
said:"Outstandingteam,greatmarket,andfantasticexecutionattractedustothestartup."Insuchbusinesses,thecostsare
frontloaded.Thecompanyhastospendtoacquireacustomer.
Thefundstheymanagedtoraisehelpedthemrampupoperations."Earlychallenge&fundingSoonafterFreshdesk
announceditsfirstfundraisingcamethechallengefrommarketleaderZendesk.

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Inamuchpublicisedspat,aseniorZendeskexecutivecalledFreshdesk"afreakingripoff".
Mathrubootham'sresponseinthesocialmediasetthemarketabuzz.
ForFreshdesk,theincidentwasablessing,attractinginvestorswhowereearliernottoointerestedinit.

Image:FreshDeskisgrowingexponentially,thankstothevisionofitsfounderGirishMathrubootham.Photograph:
Courtesy,FreshDesk/Facebook
OneinvestorinvitedMathruboothamtoMumbaiandofferedamarkupof30percentofvaluation.
MathruboothamspoketomanyotherinvestorsandfinalisedtheSeriesBfundingwithTigerGlobal.
"Oncewehad$5million,itchangedeverythingWeputeverythinginmarketing,"hesaid.Asmallerroundoffunding,of
around$7millionfromtheexistinginvestors,followedinNovember,2013.
Withthis,thecompanyhadgoodinvestorsandgoodcredibilitywithAccelandTiger.Inthefourthround,of$31million,the
companygotGoogleCapitalasitsinvestor.
ItwastheGoogleCapital'sfirstfundinginaninternationalcompanyandbroughtalotofcredibilitytothecompany.
Thecompany'svaluationhasgoneupmorethan100timesbetweenthefirstfundraisingandtheSeriesE,hesaid.
ChallengesnowThepriceofFreshdesk'sproductsare5060percentlowerthanitscompetition.
Thecompanysaysitisdifferentfromcompetitorsintermsofaffordability,breadthofchannelsanddepthinservice.
"Wearethefastestgrowingcompnayinoursector,addingmorecustomerspermonthandperquarterthananyofthe
competitors.
In2013,wegrew500percentin2014,wegrew300percentin2015,ourtargetistogrow250300percentmorein
termsofnumberofcustomersaddedandrevenue.Itisverylinearlycorrelatedforus,"Mathruboothamsaid.

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Image:Wayforward,FreshDesk'smanagementfeelsbuildingnewproducts,increasingsalesorscalingup
operationsisnottoodifficultbutkeepingitsuniqueculturealiveevenasitexpandsis..Photograph:Courtesy,
FreshDesk/Facebook
However,herefusedtorevealtherevenue.Atpresent,thecompanyhasabout500employeesandofficesinLondon,
SydneyandChennai.
WayforwardThecompanymanagementfeelsbuildingnewproducts,increasingsalesorscalingupoperationsisnottoo
difficultbutkeepingitsuniqueculturealiveevenasitexpandsis.
Thetransformationtomobileplatformsisanotherareathatthecompanywouldliketofocusonandisworkingwith
applicationdevelopers.
Makinginroadsintomarketsacrosstheworld,includingnonEnglishspeakingcountries,wouldbeachallenge.
Thecompanyislookingathavingover1lakhcustomersacrosstheworldintwoyears.
"Weareintheexpansionphase.Wehaveasolidproduct,weareveryconfident,"hesaid.FreshdeskalsolaunchedanIT
servicemanagementproductFreshservicetooffercloudbasedservicedesksolutionforsmallercompaniesfortheirinternal
ITsupport.
"WewanttobuildasuccessfulproductcompanyoutofIndia,whichwearealreadydoing,"saidMathrubootham.
Experttake
Theglobalcustomerrelationshipmanagementsoftware(CRM)markethasbeenontheriseandisestimatedtoreach
around$37billionby2017.
Thisisprimarilyduetotherateatwhichbusinessesofallsizesareactivelyadoptingdigitalmarketingactivitiestostayclose
totheirexistingcustomerbase,aswellasacquirenewcustomers.
Thisisbecominganecessityasmoreandmorepeoplearedigitallyconnected.Themillennialgenerationisalsoquickly
gettingcomfortableininteractingthroughdigitalchannels.
ThereisgoingtobeanincreasingdemandforCRMsolutionsforanyandeverysizeofbusiness.
OnechallengethissegmentmayfacecouldbescoresofsmallerCRMsoftwaresolutionoptionswithfewerorno
differentiators.
FreshDeskwasfoundedtoenablebusinessesofallsizestoprovidegreatcustomerservice.
Theirpricingmodel,Ibelieve,wouldcontinuetobeconduciveforsmallerbusinessestoengagewiththeirendconsumers.It
needstostayfastonfoundingprincipleswhilecontinuingtoinnovate.
Thereisincreasingdemandandthegrowthtrajectoryofthissegment.
TheconfidenceinvestorshaveshownonFreshDeskandthedirectionitismovingtowards.IamhappytoseeFreshDesk
emergingasonemoreexampleofworldclassproductsMadeinIndia.
SriramSubramanyafounder,managingdirectorandchiefexecutiveofficer,IntegraSoftwareServicesisamemberofThe
ChennaiAngels
GireeshBabu
Source:

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