Freshworks to secure $1 billion in IPO at $10 billion valuation

By siliconindia  |  Wednesday, 22 September 2021, 09:37:41 AM IST

Freshworks to secure $1 billion in IPO at $10 billion valuation

SaaS startup Freshworks, which is likely to list on the Nasdaq Wednesday, is planning to raise as much as $1.02 billion through its initial public offering (IPO) at a valuation of over $10 billion.

This is the first India-born software products startup to list on the US stock exchanges.

The San Mateo-based startup, which was founded in Chennai, plans to trade 28.5 million shares at a price of $36, the company said in a press release on Wednesday, up from the marketed range of $32-$34 the firm proclaimed earlier this week, pointing to strong investor interest.

Previous week, Freshworks had disclosed to the US Securities and Exchange Commission that it was targeting a price range of $28-$32 for its stock in the IPO.

In addition, Freshworks has granted the underwriters a 30-day option to buy up to an additional 2,850,000 shares of Class A common stock at the IPO price minus underwriting discounts and commissions.

Freshworks reported a 53% surge in its revenues to $169 million in the six months that ended June 30, 2021 compared with revenue of $110 million recorded in the same period past year. At the same time, losses declined piercingly by 83 % to $ 8.9 million. The firm was valued at $3.5 billion when it raised $150 million from Sequoia Capital, CapitalG and Accel in November 2019.

Its prospectus, filed with the SEC last month, disclosed that affiliates of investors Accel and Tiger Global both own over 25% of the company’s Class B shares, while Sequoia Capital owns a little over 12% of the same class of shares.

The software-as-a-service startup is seeking to list its shares on the Nasdaq Global Select Market, under the symbol FRSH.

Freshworks, is the latest to unite a rush of venture-funded companies in India that are also aggressively diversifying beyond private markets on the back of a stellar domestic listing by food technology platform Zomato in July.

In the meantime, in the US a wave of listings by technology ventures such as Zoom, Snowflake, Asana and Palantir have been extremely well received in the backdrop of increasing digitisation world over, especially after the onslaught of the Covid-19 pandemic.

The firm said it now has over 52,000 customers and in the last 12 months has earned a revenue of $308 million, a growth of over 40%, while posting a net loss of $10 million, in the same period.

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