The Indian software-as-a-service (SaaS) business had now been improving and expanding exponentially since previous years, but Freshworks’ public listing at Nasdaq has driven it all to some other level. The company, which offers client engagement software for businesses, was estimated at a mountainous $12.2 billion after it began 21% above the initial offering price of $36 individually.
Freshworks traded 28.5 million common public shares, hitting an intraday high of $48.75 on September 22.
Girish Mathrubootham and Shan Krishnasamy founded Freshworks over a decade before. The duo co-founders were past employees of Zoho Corp, which too is one of the greatest SaaS companies in India. Soon, both Zoho Corp and Freshworks were and still are competitors and the biggest performers in this industry.
Here is a timeline of Freshworks’ journey so far:
In founding this startup, he has promptly performed a very forward-thinking attitude in terms of execution and establishing. However, Mathrubootham’s story actually originates somewhere else. Born and brought up in Tamil Nadu, Girish started his academic career as an engineering student as is the pattern for a vast majority of students in India.
Early on, he felt an ability for learning things his own way and ultimately landed himself at the University of Madras, commencing his MBA in Marketing. Though he had moderately of a normal push to his professional career, the defining moment would be when he entered the Zoho Corporation as the Director of Product Management. After a two-year stint in that position, he saw himself caught on the role of Vice President for Product Management in the corporation.
Later about half a decade with Zoho, he went on to start his own firm, which was originally known as Freshdesk. This was founded as a solution to the pre-existing and arduous business softwares that were widespread in the industry. Mathrubootham desired to create a cloud-based customer service tool that concentrated solely on its customers. He went on to do exactly that. In June of 2017, the business was formally and officially re-branded to Freshworks, a name that would become a core chapter of the infamous ‘Zoho Mafia’.
The company saw such exponential growth below this business giant that it fitted as the first Indian software creator to list on Nasdaq after it raised over $1.03 billion throughout its initial public offering (IPO). It also succeeded to record a market capitalization of nearly $10.13 billion. Driven by substantial investor sentiment, the Freshworks company’s share price fired up by as much as 33 percent to $48 in the initial selling on the Nasdaq. This caused the market capitalization to nearly $13 billion.
The SaaS pioneer has acquired 13 startup businesses to date including Zarget, Flint, CanvasFlip, and Natero, among others.
“I feel like an Indian athlete who has won a gold medal at the Olympics. We are showing the world what a global product company from India can achieve,” Girish told, in an interaction with media. He further shared that the Freshworks IPO has made 500 crorepatis in India, 70 of which are under 30 age group.
Freshworks Tactics for Succeeding in the Market
Let us look at the extent of Freshworks’ tools & services: As shared already, Freshdesk was the first help desk product the company began with. It went on to start additional SaaS products like Freshservice (2014), Freshsales (2016), Freshteam (2017), and now it has increased to a full set of business answers to catch the entire customer life cycle.
Building a Red Ocean Market Playbook
In an interview, Girish talks about choosing red ocean markets and creating a playbook that operates well in such markets. In blue ocean markets, the business usually needs a dedicated sales team to teach the customers about why they need the product? On other hand, in a red ocean market, there lives a clear market that doesn’t need to be identified. When Freshdesk began, there were over 600 help desk products in the market, hence a deep red ocean market.
Smart Performance to Win Over Opponents
Freshworks proved themselves already by growing from $1 million in ARR (annual recurring revenue) to $100 million ARR in only five years. This pace of growth matches those of the biggest SaaS startups globally. And it took certain unconventional ways as well to reach this level. Freshworks generated online content and applied guerilla marketing procedures to compete against established players such as Zendesk and Salesforce.
Freshworks got itself notice beside leading companies such as Zendesk by a RipoffOrNot campaign. In December 2011, Freshdesk was termed a Rip Off by the Zendesk CEO on Twitter (because of ‘desk’ in both names). But instead of arguing back on Twitter, Freshdesk built this RipoffOrNot campaign website where it proudly presented Zendesk’s CEO’s accusation and requested users to make up their minds for themselves. This drove Freshdesk to get PR alongside Zendesk — essentially placing it in the same plane as market leader Zendesk — a brilliant way of benefiting from a competitor’s outrage. There are many more examples of such marketing tactics which Freshworks used to cash for them.
Freshworks Success in Numbers
From just six clients in 2011, the company now maintains a clientele of covering 220,000 customers in more than 120 countries. From a team force of four, Freshworks now has over 3,000+m eployees.
Freshworks started with a tiny idea for a ‘fresh’ helpdesk in 2010, Mr. Girish stated in a blog post this Thursday. With 52,500 customers, the organization saw its evrenue growth in the first six months of 2021 to $169 million, up from $110 million in the opening half of 2020. Its net loss narrowed to $9.8 million from $57 million from a year ago, as per the company’s filings. Rest is now a victory in history for them; as you must be aware about Freshworks IPO debut into NASDAQ.
“This was possible because of the dedication and commitment of our employees, customers, partners, and investors to a company that started 11 years ago,” he declared.