Data analytics company Mu Sigma has raised money from MasterCard in a deal that values it at more than $1 billion ( Rs 5,400 crore), racing to the milestone within just eight years of its founding.
Dhiraj Rajaram, the 38-year-old founder who left consulting firm Booz Allen Hamilton to start the company with $200,000 in savings, will be counted among the country’s wealthiest entrepreneurs by virtue of his holding of around 50% in the company that is based in Bangalore and US President Barack Obama’s hometown Chicago.
The strategic deal, in which Mu Sigma gets $45 million from a MasterCard arm and a group of global financial investors, including Fidelity Investments, combines money and access for ceding a stake of less than 5%. The company will partner with MasterCard Advisors, the analytics arm of the payments provider, to build products that can predict consumer behaviour and define business strategy, not just fine-tune it.
“Data is the new ‘oil’ and there is a growing need for the ability to refine it,” said Dhiraj Rajaram, the 38-year-old founder of Mu Sigma, which has now raised $195 million, including investments from General Atlantic and Sequoia Capital.
Rajaram is gaining a reputation as an outlier in a high-value, high-growth business area. By 2018, the market for data analytics is expected to be worth $48.3 billion. And there will be a demand for at least 200,000 data scientists, according to a study by consulting firm McKinsey.
While peers in the business have built and sold companies, including Marketics (acquired by WNS Global) and MarketRx (snapped up by Cognizant), Rajaram has been dogged in his insistence that data analysis, or decision sciences, will emerge as the next big outsourcing opportunity after IT services.