WestBridge Capital is now Freshworks’ second-biggest institutional investor

With its recent additional investment in homegrown software development company Freshworks, investment firm Westbridge Capital now owns nearly $217 million worth of shares in the company.

This is the second largest in value after The Vanguard Group, which has a little over $223 million worth of the company’s shares, NASDAQ data shows.

This was first reported by VCCircle on Friday, which said it is one of WestBridge Capital’s “single biggest bets”.

One of the largest alternative investment firms in India, WestBridge is reported to have almost $10 billion in assets under management, according to The CapTable.

The investment filing came a day after Freshworks reported its fourth-quarter results for 2022 as well as full-year earnings, indicating that it would end the current year by turning operationally profitable. 

Emails sent to both Freshworks and WestBridge Capital have not yet received any responses. The copy will be updated if and when YourStory hears from them.

The only Indian-origin SaaS firm to be listed on the NASDAQ so far, Freshworks posted a 26% growth in revenue at $133.2 million in the October-December quarter of 2022, surpassing the $500 million annual recurring revenue (ARR) threshold for the first time.

According to the company’s filings with the US Securities and Exchange Commission (SEC), WestBridge Capital owns 10.24% of Freshworks’ Class A common stock. 

The investment firm has acquired the shares via WestBridge Crossover Fund, registered in Mauritius. 

Shares of Freshworks, which went public in September 2021, closed at $15.76 apiece on February 17, over 56% lower than its initial public offering (IPO) price of $36 per share. Much of its market capitalisation (was over $13 billion when it got listed) was wiped off mainly due to the great tech selloff of US tech stocks in 2022 as investors readjust their lens to assess business fundamentals of companies in the post-pandemic era.

In recent years, WestBridge seems to have taken some big bets on Indian tech businesses, which include some notable software-as-a-service (SaaS) and edtech investments. In November 2022, it invested $57 million in Hyderabad-based HR software startup, Keka HR, which was the largest Series A round for any SaaS company in India.

Bengaluru-based SaaS startup Leadsquared, a sales, marketing, and onboarding automation solutions provider, raised $153 million in Series C last June led by WestBridge Capital, achieving the unicorn status. SaaS accelerator Upekkha also received $9 million towards its rolling fund, to invest in early-stage SaaS startups.

(The story was updated to remove the line which refers Class A typically has more clout than Class B shares by way of control and monetary benefits.)