Exciting news alert- Fractal AI announced its entry into a USD 1 billion dollar unicorn club
The year 2021 saw many unicorn AI startups. Almost every month we had 2 to 3 startups turning into unicorns. We had a very positive response regarding all this. Let us see what the year 2022 holds in it regarding the startups and the unicorns.
Let us talk about unicorn startups. Explaining what a unicorn startup is, it is defined as the privately-owned startup/entity the value of which is more than USD 1 billion. This term was introduced in the world of economics by Aileen Lee in the year 2013.
This term was chosen because at that time there were very few (scarce) unicorn startups because the number at that time was shockingly or surprisingly 39. Aileen Lee is the founder of Cowboy Ventures.
Coming to the features of the unicorn startup, each unicorn startup has a different feature. But there are some of the features that are common in almost all unicorn startups. The following features are-
Innovative-The unicorn startups are highly innovative. They bring about a change in the industry in which they are operating.
First mover advantage– Unicorn startups always have the first-mover advantage. They are basically the firsts in the industry and bring about a solution to the problem that has long been there in the market and no one has looked into.
Highly technical- One of the most common features of a unicorn startup is that they have a high level of technology in their business line. Their business model runs on technology.
According to a report published, out of the total unicorns, 87% of them have software in their business line, 7% of them have the hardware, and the remaining 6% have products and services in their product line.
Big focus on customers-The another important feature of a unicorn startup is that they are customer-focused. Around 62% of the unicorn startup are B2C companies and are there in the market with the aim to make the life of the customer easy and eventually be an important part of their day-to-day life.
Being a unicorn earlier was like something scarce achieved. But in today’s world, it is achievable. The previous year saw many unicorn startups coming up in the Indian economy. We agree that reaching a status of a unicorn is like reaching a milestone but it is not always necessary that every startup reaches this point of success and fame. But it shouldn’t stop a startup from trying its best.
Let us now talk about a startup that has turned unicorn recently.
Announcement of a unicorn startup
The startup, Fractal Analytics has raised funds worth USD 360 million, which is equivalent to INR 2700 crore, as announced on January 05, 2022. This round of funding was led by TPG Capital Asia, the Asia-focused private equity platform of the firm.
This transaction consists of a combination of primary investment and secondary share purchase from funds, which will be advised by Apax. Apax will continue being the major shareholder post the transaction.
According to the deals of the transaction, Puneet Bhatia and Vivek Mohan of TPG will join the board of directors of the startup. Even the existing board of directors which constitute Gavin Patterson, Rohan Haldea, and Vivek Mohan will continue working for the board of the startup.
TPG will even be the minority shareholder of the startup. This transaction is expected to complete by the first quarter of the year 2022.
Post this round of funding, the total funds raised by the startup have come up to USD 685 million and consist of secondary share purchase even. Post this round of funding, the value of the startup will reach USD 1 billion, thus entering the Golden Unicorn Club. The startup is the second Indian unicorn startup of the year 2022.
The startup plans to use the funds raised in further investing in products and for more Mergers and Acquisitions. The startup has made acquisitions of five companies in the year 2021 for around USD 100 million. The names of the companies acquired are Samya.ai, Zerogons, FinalMile, 4i, and Imagna. The startup has the hopes to invest similarly in this year even.
About the unicorn startup
The startup, Fractal Analytics, was founded in the year 2000 by Srikanth Velamakanni and Pranay Agrawal in Mumbai. Later in the year 2005, the startup opened its office in the United States, and then in the year 2015, another office was opened in Bengaluru, India.
The startup is a multinational artificial intelligence company that is engaged in providing services in healthcare, insurance, retail, technology, consumer packaged goods, and the financial sector.
The vision of the startup is to give power to every human decision in the enterprise so that the human mind can be free to imagine bold and different possibilities that can transform human life across the planet.
The startup is of the mission to use science and advanced data tools and uncomplicate decision making in reshaping business, so human intelligence can be kept free from the drudgery of monotonous and boring work and committed to the pursuit of imagination and creative rewards.
The startup is engaged in providing solutions related to analytics and artificial intelligence to many Fortune 100 firms. The offerings of the startup consist of Qure.ai, which provides help to the radiologists in making better and accurate decisions and diagnoses. The other offering includes Eugenie.ai, which is helpful in finding anomalies in high-velocity data.
The other offering Samya.ai is helping the next generation enterprise revenue growth management. The last offering is Senseforth.ai which helps in automating the interactions of the customer in order to grow top-line and bottom-line.
Talking about the values of the startup, they are as follows-
Client First– Always do what is best for the client.
Learn and Grow– Nurture and grow exceptional professionals.
Think big, act fast– Challenge the status quo and execute with speed.
Extend extreme trust and be accountable- Assume the positive intent of others and hold each other accountable.
Coming to the acquisitions and the fundings of the startup, they are as follows-
In June 2017, the startup acquired 4i Inc, which is a strategy and analytics firm based in Chicago.
In September 2017, the startup came into partnership with Final Mile, so that data science and behavioral science could be combined.
In March 2018, the startup acquired Final Mile, the behavioral architecture company.
In January 2019, the startup received funding of USD 200 million. This round of funding was led by Apax Partners, which is a private equity advisory firm and is leading around the globe.
The startup has more than 3500 employees around the world and has an annual revenue of more than USD 100 million.
What has been said about the deal?
Srikanth Velamakanni, the founder of the startup made a comment saying that the clients of the startup want their business to go digital and thus offer more personalized solutions to their customers.
He further said that the startup also engages in working with the clients on different areas like improvement of efficiency, productivity, forecasting, and supply chain planning. He then said that this has become very important to the firms because of the pandemic.
Talking about whether the startup is planning to go public, he said that they wish to become a public company soon. But he then even said that he will not be able to share the time when it will go public. He then accepted that the startup has the scale, size, maturity, and governance of a public company.
The startup is working on the current needs of the economy. We wish the startup a bit of good luck and a bright and successful future ahead.
Edited and Proofread by Ashlyn
