Brands
Discover
Events
Newsletter
More

Follow Us

twitterfacebookinstagramyoutube
ADVERTISEMENT
Advertise with us

Whatfix bets on multi-product strategy for growth

From selling a single product until 2021 to adding new solutions, including analytics for enterprises, SoftBank-backed SaaS company Whatfix aims to build a suite for “userisation” on its digital adoption platform.

Payal Ganguly

Bhuvana Kamath

Whatfix bets on multi-product strategy for growth

Monday December 04, 2023 , 6 min Read

SoftBank-backed enterprise SaaS startup Whatfix has been working on diversifying its product line-up to maintain revenue growth. Over the last year-and-half, the Bengaluru-headquartered company has focused on building a suite of products for its digital adoption platform (DAP) keeping “userisation” at the core, says CEO and Co-founder Khadim Batti. 

“Userisation means that the software adapts to the individual user, instead of the user having to learn the software. Whatfix wants to promote userisation layer for all critical software such as ERP, CRM and back-end software, while making sure that the security of critical software is not compromised,” Batti tells YourStory

The company’s latest offering, Enterprise Insights, offers analytics on top of the software stack for better decision-making. Currently, in the beta-stage, the solution helps enterprises monitor usage, time-spent and other metrics for any software, ultimately helping in making decisions around adoption and licensing. 

Around 8-10 customers currently use the solution. 

Diversification to sustain growth

Founded in 2013 by Vara Kumar Namburu and Batti, Whatfix began its journey by providing a SaaS solution that improved onboarding processes in areas like HR, CRM (customer relationship management), and ERP (enterprise resource planning) via training help guides for organisation.

It also aimed to enhance efficiency in resolving customer support issues for enterprises.

Whatfix’s web adoption tool remained the core product offering till 2021, contributing to 100% revenue at the company.

Things have now changed. 

“In the last 18 months, Whatfix has transitioned from a single-product company to a multi-product company. About 70% of the software is web-based and there are 25% software still on the desktop. Around 5-20% of software can be accessed on mobile,” Batti tells YourStory

According to Batti, the contribution of non-web or desktop mobile DAP, along with enterprise analytics and simulation products to the company’s revenue will likely double in the next 12 to 18 months, from 10% at present.   

Its acquisitions: Airim, which it bought in 2019, Nittio Learn in 2021, and LEAP in 2022, fit into its vision of building full-stack, personalised products. In 2019, Whatfix also backed Skillate, an AI-based HRtech firm, during its pre-Series A funding round of $1 million.

“We are trying to ensure large enterprises can realize ROI and the software stack. We need to have a lot of analytics and productivity tools. We are building some and also acquiring them organically so that it can fast track our road map,” says Batti, adding that the company continued to be open to future acquisitions.

In May 2023, Whatfix announced that it had reached the milestone of recording $50 million in Annual Recurring Revenue. According to documents filed with the Registrar of Companies, the company saw its revenue from operations rising by nearly 66% for FY23 to Rs 284.7 crore ($34.1 million approximately) from Rs 172.4 crore in FY22.

Whatfix was on track to grow 55% year-on-year with a focus on improving efficiency, Batti says. 

New geographies for growth

Whatfix’s primary market is the US, which contributes to 73% of its revenue followed by the UK, Germany, and Western Europe, which contribute around 20%. The company now aims to double down in India, Singapore and Australia in the coming year. Its focus on geographies outside of the US has helped Whatfix weather the macro conditions, says Batti. 

The company also managed to double its Annual Contract Value (ACV) over the last nine months, with nearly 65% contribution from new customers.

The uptick in digital adoption stands to benefit SaaS companies in general, says Biswajeet Mahapatra, Principal Analyst at research and advisory firm, Forrester. “SaaS adoption has grown globally by 40% over the past one year and they plan to grow similarly in the next coming years. Customer retention is not a major challenge although around 10 to 15% of customers are looking out for other options,” says Mahapatra. 

“While these factors help in cross-selling and new customer intake, Indian SaaS companies also need to work towards building credibility, compliance, competitive pricing and local support in new geographies,” he adds.

Indians represent a diverse bunch of audience, presenting a vast number of challenges and opportunities to local SaaS platforms, says Kalpana B, CEO of Grant Thornton dGTL. “While this presents an abundance of opportunities for SaaS platforms to innovate and serve the domestic audience, it can also limit their ability to innovate for a global audience and scale, where requirements differ greatly from their Indian counterparts.”

Additionally, Kalpana believes that intense global competition, regulatory compliance complexities (such as GDPR), and cultural nuances pose hurdles. In such an environment, adapting to diverse languages and ensuring data security becomes crucial. 

“Furthermore, the marketing network is dominated by a few major players. There lies significant emphasis on intent marketing by global players. This also requires major investments, building trust in international markets, and overcoming infrastructure challenges as a major barrier,” adds Kalpana. 

Market opportunity

Whatfix was recently in the news for a lawsuit filed by Israel-based and NASDAQ listed DAP competitor, WalkMe under California’s Unfair Competition Law. Both companies compete in the growing DAP market which is projected to grow to surpass $3 billion by 2030, growing at a CAGR (compound annual growth rate) of 23%, according to a recent report by Fortune Business Insights. 

Also Read
Whatfix says no bearing of WalkMe's lawsuit on business

The growth will primarily be driven by growing product deployment in various applications including product training, user onboarding, customer support, employee onboarding, change management and other sectors. 

Apart from the BFSI sector which makes up nearly 17% of Whatfix’s revenues, the company also serves pharma and technology enterprises. It has also signed up hotel chains, universities, and companies like ICICI Bank, Sophos, and Hays, along with government contracts in the US.  

Valued at $568 million in 2021 when it had raised its Series D round of funding led by SoftBank Vision Fund, Whatfix was also reported to be in talks with private equity players for raising a new round of funding. 

“We want to avoid optimising too much on valuations and putting unnecessary pressure on employees,” says Batti, confirming that the company has had discussions with private equity firms and hedge funds. 

“The company is not obsessed with the unicorn tag or specific valuation numbers. The company is taking a more pragmatic approach to valuation and fundraising. It is focused on growing its business sustainably and creating an upside for all stakeholders, rather than chasing short-term valuation gains,” he adds.


(The copy was updated to clarify that Whatfix backed Skillate.)


Edited by Affirunisa Kankudti