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(iSPIxB2B)
Value of Top 30 Indian B2B Software Product Companies is
$10 billion. Index is up 20% in USD terms.
Second Edition, June 30, 2015
(Online discussion at http://bit.ly/1LU0sKg )
deliver disruptive value to enterprise customers in India and around the world
grow beyond the tens of thousands of jobs to hundreds of thousands of jobs in India
drive a large amount of foreign exchange earnings for India
create billions of dollars of value for founders, employees and investors.
To drive a focused discussion, we have chosen to include companies that sell software to businesses
on a license or subscription basis or where software drives a differentiated B2B service such as a B2B
exchange or advertising network. The index includes business applications, media technology and
infrastructure technology companies.
The Results
Indias B2B software product industry has grown nicely the top 30 companies are valued at $10.25
billion (`65,500 crores) and employ over 21,000 people. The index has grown 20% in USD terms and
28% in INR terms 1from October 30, 2014 to June 30, 2015. Growth has been primarily driven by a
third of the companies in the index growing their revenue or reaching large enough scale to start
justifying global valuation metrics. Some key takeways:
There has been an acceleration since 2010 in the pace of creation of B2B companies.
There has been a notable increase in enterprise value per employee, showcasing shift from
services-heavy to product-heavy offerings.
Vertically-focused offerings in retail, travel, financial services, media co-exist equally with
horizontal offerings targeting global markets.
There is a decreasing frequency of bootstrapping relative to VC financing to get to scale.
50% of companies are in end-user applications with the remainder split evenly between media
technology and infrastructure/tools.
80% of companies have global customer bases, while the rest are India-focused.
67% of companies are domiciled in India, with the rest principally in Singapore and the US.
Bangalore and NCR account for half the companies principal city of operations in India with
Chennai and Pune as key secondary hubs.
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There have been changes in the companies included in the index. Please note that the index tracks growth in aggregate market values for only those
companies that are present in both the previous and current indices refer to the section in the Appendix entitled Index composition for detail on
the companies included and methodology used.
Acceleration
The spread of companies in the top 30 based on when they were started is interesting to track.
Clearly, companies created in the past decade are disproportionately highly represented in the index.
Companies created since 2010 are even more disproportionately represented in the index keep in
mind that many of these have not been around long enough to realize their full potential yet.
This data shows the acceleration in the pace of creation of valuable B2B software product companies,
perhaps coming through the ability to access global markets, availability of venture capital and a big
acceleration in the use of technology by businesses globally. Over time, we expect companies in the list
to be almost completely displaced by companies started since 2005. We expect the value of the top 30
Indian B2B software product companies to expand well beyond its current value of $10 billion (`64,000
crores) into the tens of billions as they participate in the $500 billion (`30,00,000 crores) global market
for enterprise technologies.
As discussed in the previous report, what is not in this index is a fairly large set of companies, many of
which started in the 1990s and 2000s and have failed to scale meaningfully, whether because of lack of
channels, lack of large customers in India or Global South-focused offerings with market size limitations.
We are clearly seeing the rise of more scalable B2B product companies. Companies started more
recently are trading at higher market values per employee than companies started further back in the
past. This is partly due to recently started companies having a far greater mix of product versus services
and therefore growing faster and to a larger global market.
43% are bootstrapped although most of the bootstrapped companies were started in the 1990s
and 2000s and most of the institutionally-funded companies got growth financing, rather than
early-stage venture capital financing.
Nearly 80% of the companies have global customer bases the ones that have remained Indiafocused are exploiting large India-specific opportunities such as the large SME base, burgeoning
ecommerce infrastructure needs, rapid growth of organized chains in retail, healthcare etc.
Please participate in the discussion around these findings at the ProductNation blog.
iSPIxB2B
iSPIxB2BUSD
100
120
iSPIxB2BINR
100
128
Top30 ValueUSD
$6.2 Billion
$10.25 Billion
Top30 ValueINR
`37,500 Crores
`65,573 Crores
Employee Base
18,250
21,200
Note: Please refer to the Index Calculation Section for detailed notes on calculations
Top30Companies
Based on the data collected, the top 30 companies in alphabetical order are as follows:
Profile
Description: Accelya Kale Solutions Limited is part of the Accelya Group,
a leading solutions provider to the Airline and Travel industry.
Chairman : Philippe Lesueur
CEO: Vipul Jain
Domicile: India
Principal India operations: Pune (HQ: Pune)
URL: www.accelyakale.com
AdNear
that leverages location and context to power data driven marketing for
advertisers.
CEO & Founder: Anil Mathews
Domicile: Singapore
Principal India operations: Bangalore (HQ: Singapore)
URL: www.adnear.com
Browser Stack
Capillary Technologies
CRMnext
Druva Software
Profile
Description: Druva offers integrated enterprise online backup, secure
file sharing and data analytics for protection and governance of endpoint
data.
CEO and Founder: Jaspreet Singh
Domicile: USA
Principal India operations: Pune (HQ: Silicon Valley)
URL: www.druva.com
Freshdesk
10
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Indix
10
Infrasoft Tech
Profile
Description: InfrasoftTech is a software products, solutions and
13
Inmobi
14
Kayako
15
Knowlarity
Communications
16
Newgen Software
Technologies
17
Nucleus Software
11
Profile
Description: Ozone Media is a Global Advertising Technology Company
focused on online advertising.
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Pubmatic
20
21
Ramco Systems
12
Rategain
Profile
Description: RateGain offers hotel channel management, hotel channel
manager and promotion management to travel and hospitality industry.
CEO and Founder: Bhanu Chopra
Domicile: India
Principal India operations: NCR (HQ: NCR)
URL: www.rategain.com
23
SunTec Business
Solutions
24
SVG Media
25
Tally
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Vizury
Profile
Description: Vizury helps marketers secure customers through
dynamic creative retargeting and display solutions
CEO and co-founder: Chetan Kulkarni
Domicile: India
Principal India operations: Bangalore (HQ: Bangalore)
URL: www.vizury.com
27
Vserv
28
Wingify
29
Wooqer
30
Zoho Corporation
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Index Calculation
The index consists of the top 30 companies in India, based on company valuations - the valuation
methodology is described later in this appendix. The index indicates the change in the sum total of
the valuation figures of the companies surviving into the top 30 companies of this edition of the index, from the previous edition. The index was set at 100 at October 30, 2014 when the first edition
was published.
The index will also be reported in USD and INR as the sum total of the valuation figures of the top
30 companies in each current edition of the index.
iSPIxB2B
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Company Selection
More than 300 Indian B2B software product companies were identified. The list was compiled from
various internal and external sources. We contacted over 100 companies and gathered data on
a substantial majority of these companies either directly from the companies, their investors or
public markets exchanges. The goal was to identify the top 30 companies in terms of valuation and
use the valuation number to compute the index as described in the previous section.
We included companies that met the following criteria:
66 the company sells software to businesses on a license or subscription basis OR
66 the company provides a B2B service driven through a differentiated software offering AND
66 the company was founded in India or had co-founders who were based in India and elsewhere simultaneously
A few very prominent companies are absent from the list as they declined to participate in the
SPIxB2B project.
DataCollected
The following key data was collected from the companies, institutional investors or public sources:
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Index Composition
Certain companies are new entrants and other companies have come off the list. The changes are
due to increased valuations in some cases or having access to data from certain companies for the
first time. Many companies are clustered around the similar valuation numbers and slight changes
in growth rates and revenue change the implied market value and therefore the ordering. Others
had been acquired or were found to be overweight on services relative to products.
The index itself changes based on the relative valuations of those companies present in both
editions of the. In other words, the index does not taken into account relative valuations of
companies that were either taken off the top 30 list or were new entrants to the top 30 list.
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Accelerite
Accelya Kale
AdNear
BrowserStack
Capillary
CRMnext
Druva
Eka
Freshdesk
IBS
IEX
Ilantus
Indix
InfrasoftTech
X
X
X
X
X
X
X
X
X
X
X
X
X
New entrant
X
InMobi
New entrant
Kayako
Knowlarity
Komli Media
Manthan
Newgen
Nucleus
Ozone
Pubmatic
Qubole
Quick Heal
Ramco
Rategain
Real Image Media
Suntec
SVG
Tally
Vizury
Vserv
Wingify
Wooqer
Zoho
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
New entrant
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New entrant
X
New entrant
X
New entrant
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
ValuationMethodology
We came across three types of companies and arrived at their market valuation correspondingly:
1) Public companies - we used the latest market valuation data from Moneycontrol.com.
2) Recently venture-backed companies - we used the post-money valuation of their latest
financing if the financing was in the past year.
3) Bootstrapped companies or venture-backed companies financing over a year ago - we
derived a valuation using revenue multiples. Revenue multiples by sector were obtained from
reputable investment banks and were adjusted based on differing growth rates.
We understand that company valuation in general, and this methodology specifically, will not result
in exact results. However, we believe that the results are directionally correct and generally in the
right ball park. We believe these results are of enough quality to support an educated discussion
as well as drive decisions from strategic partners and governments regarding the Indian software
product industry.
Confidentiality
In general, data has been provided by companies and their investors. No company-specific data
obtained for the purposes of this index have been published nor will be published. We are only
publishing aggregate data. We respect the sensitivity of this data.
Acknowledgements
We would like to thank all the companies and their investors for sharing data with us. In addition
the authors of this report would like to acknowledge the following people for their contribution and
support to the project.
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Contact the iSPIx team at ispix@ispirt.in with any questions, comments or suggestions for other
companies to consider for the next edition of the index.
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