Digital adoption platform (DAP) provider Whatfix has secured $125 million in a Series E funding round led by Warburg Pincus, with participation from existing investor SoftBank Vision Fund 2. The investment values the San Jose-based company at around $900 million, a 50% increase from its Series D valuation in 2021, according to sources aware of the matter.
Whatfix plans to use the new funding to expand its market presence in the US, EMEA, and APAC regions. The company has already opened new offices in Singapore, Germany, Australia, and India, doubling its workforce to over 960 employees. CEO and co-founder Khadim Batti said: “We have started hiring in Southeast Asia and Middle East (West Asia) or Dubai market where we are expanding.”
The investment will also support product development, particularly in generative AI. Whatfix is launching an intermediate product next quarter that will automatically generate content based on application knowledge and support data. The company is also experimenting with automated “agents” capable of performing actions within certain apps, similar to robotic process automation.
Whatfix will also use the funds for strategic acquisitions, adding to its previous purchases of Airim, Nittio Learn, and Leap.is over the last four years. Batti mentioned they’re open to acquiring firms that enhance their product line or accelerate their AI tools development.
Since its last funding round, Whatfix has introduced connectors for customer relationship management and enterprise resource planning software, as well as a monitoring dashboard for managers. These new products now account for 15% of the company’s revenue.
Whatfix reported revenue of Rs 285 crore for FY23, up 65% year-over-year. However, losses widened by 31% to Rs 328 crores due to increased expenses. Batti projects Ebitda break-even within 7-8 quarters, citing 45% growth in FY24. He emphasised the company’s disciplined approach to capital management, stating, “We’ve been very disciplined with our now-$265 million capital, and our ability to grow profitably while expanding within our customer base has helped us maintain strong financial health.”
While Batti did not directly comment on IPO plans, he noted that Warburg Pincus has a “proven track record in guiding companies to IPO and operating with public companies positions”.
The round comes at a time when the global DAP market is experiencing significant growth. Gartner predicts that 70% of organizations will use a DAP by 2025. According to Statista, worldwide spending on digital transformation reached $1.85 trillion in 2022, up more than 16% from the previous year, driven in part by the pandemic and the shift to remote work.