Steadview Capital picks up $85-mn stake in Freshworks

By Narinder Kapur

  • 27 Jul 2020
Credit: Thinkstock

Alternative investment firm Steadview Capital has bought a minority stake in software-as-a-service unicorn Freshworks Inc. for $85 million (Rs 635.7 crore at current exchange rates).

The UK-based firm invested in Freshworks via a secondary transaction, a spokesperson for Steadview told VCCircle in response to emailed enquiries.

The firm didn’t disclose the identity of the sellers or the size of the stake it holds in San Mateo-based Freshworks.

News of the secondary transaction comes after Freshworks in November said it had raised $150 million in a Series H round of financing. Participants in the exercise included Sequoia Capital, CapitalG and Accel.

At the time, the company said its post-financing valuation following the Series H round stood at $3.5 billion. At this valuation, Steadview would have received a 2.4% stake in Freshworks.

The Economic Times, which first reported the development, said Steadview bought out some of Freshworks’ early angel investors. The report didn’t name those investors.

Steadview managing director Ravi Mehta told the daily that it is likely to increase the pace of its dealmaking in the country in the next few years. “Overall, Steadview has $2 billion invested in India including both private and public companies and is very excited about the opportunities in the country,” Mehta said, per the report.

According to VCCEdge, the data research arm of Mosaic Digital, other investors in Freshworks include Tiger Global, CapitalG (formerly known as Google Capital), Accel India and Sequoia Capital India.

Freshworks has also made acquisitions to boost its portfolio. Earlier this month, the company took over cloud management platform Flint, a Singapore- and India-based firm. In May last year, it acquired US-based customer management platform Natero Inc.

Steadview makes long-term investments across several industries, with its investor pool including family offices, endowments, foundations, sovereign wealth funds and pension funds. Its India portfolio includes companies such as Ola, Ninjacart, Policybazaar, Lenskart and Quikr.

The firm’s most recent bets include investing around Rs 100 crore in beauty e-tailer Nykaa in March.

In February, it joined Tiger Global, WestBridge Capital and other investors in the $70 million Series C funding round of Noida- and San Francisco-based healthcare data analytics startup Innovaccer Inc.

Also in February, Steadview participated in a $75 million Series C funding round or digital payments firm BharatPe. The round was led by Coatue Management and Ribbit Capital.

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