Sequoia Capital India-backed enterprise human resources (HR) management platform Darwinbox has joined the coveted unicorn club as its parent raised $72 million as a part of its Series D funding round, the company said in a statement on Tuesday.
The funding was led by Technology Crossover Ventures (TCV) with participation from existing investors Salesforce Ventures, Sequoia Capital India, Lightspeed India, Endiya Partners, 3One4Capital, JGDEV and SCB 10X, the company said.
With the latest fundraise, the six-year old company has raised $110 million till date.
The platform, operated by Darwinbox Digital Solutions Pvt Ltd, will be using the funds for product innovation and for enhancing sales and marketing, the company’s Co-founder Rohit Chennamaneni told VCCircle in a virtual interaction. The company will also double down on its markets in Asia, Chennamaneni said.
“Getting into a position of dominance in Asia, in the markets we are already present in, and then in other markets in Southeast Asia and Middle East, will be our key focus. We will also look at markets beyond that, like the US, where, a part of the funds will be used. On the product line as well, we will be investing in building more technologies into the product and then we will be investing in new technologies to build newer products,” said Chennamaneni.
The HR management software-as-a-service (SaaS) firm said it will double its overall team and also launch operations in the US this year. The company claims to have grown 200% since its last fund raise from Salesforces Ventures in January last year.
Darwinbox was founded in 2015 by Chaitanya Peddi, Jayant Paleti and Chennamaneni. The platform offers automation of employee lifecycle including recruitment, onboarding, attendance, expense management, payroll, employee engagement, performance management and people analytics.
Chennamaneni also said that Darwinbox’s India business is profitable and the company expects to achieve profitability on a company level by 2025.
The company’s revenues, according to Chennamaneni, have doubled in 2020-21 (FY21). In 2019-20 (FY20), the company had reported revenues of Rs 24.27 crore on a standalone basis and the company’s loss after tax was Rs 5.84 crore for the year.
Chennamaneni further expects the company’s revenue to double in the current financial year.
Darwinbox currently generates 75% of its business from India and 25% from other countries in Asia and Middle East, Chennamaneni said. However, going forward, Chennamaneni expects India and Southeast Asia to contribute 35% each to its total revenues, with 20% coming from Middle East and 10% coming from the US.
The company’s HR solution competes with those of SAP and Oracle, along with other vendors in the enterprise segment. Going forward, Darwinbox is bullish on its performance management, Chennamaneni said
Currently, the company serves 650 enterprises and over 1.5 million employees. Darwinbox counts Nivea, Starbucks, Dominos, T-Systems, AXA, Tokio, Cigna, JSW, Adani, Vedanta, Mahindra, Kotak, NSE, Ujjivan, Makemytrip, Swiggy and Tokopedia, among others as its clients. Chennamaneni said that the company is bullish on banking and manufacturing businesses going forward and expects companies in these two sectors to drive revenue growth for Darwinbox.
"We get most excited investing behind visionary founders that are fundamentally transforming large industries with a highly resonant product,” said Gopi Vaddi, General Partner, TCV. “I am delighted to back an outstanding team that is doing exactly that in a highly impactful, fast-evolving HR technology space and partner with them on their journey to global HCM leadership,” Vaddi added.
In 2019, Darwinbox had raised $15 million from Sequoia Capital, with participation from Lightspeed India, Endiya Partners and 3one4 Capital.