SaaS Unicorn Gupshup’s FY22 Profit Narrows To INR 40 Cr, Revenue Crosses INR 1,000 Cr Mark

Enterprisetech unicorn Gupshup’s total revenue crossed the INR 1,000 Cr mark in the financial year ended March 31, 2022. The San Francisco-headquartered startup’s total revenue jumped 53% to INR 1,140.7 Cr in the financial year 2021-22 (FY22) from INR 747.6 Cr in the previous fiscal.

Revenue from operations jumped 1.5X to INR 1,132 Cr from INR 739 Cr in FY21. Gupshup primarily earns revenue by providing mobile messaging services and mobile advertisement through text messages. 

The rise in awareness about customer engagement during the pandemic boosted the startup’s sales during the year under review. 

However, Gupshup’s consolidated net profit narrowed 24% year-on-year (YoY) to INR 39.9 Cr, despite the rise in operating revenue, due to the surge in expenses. The startup had reported a net profit of INR 52.5 Cr in FY21.

Gupshup’s total expenditure increased 62% to INR 1,084.2 Cr from INR 671 Cr in FY21 due to  a sharp rise in its expenses for material consumed. Gupshup’s cost of material consumed rose 44% to INR 814.1 Cr in FY22 from INR 565.2 Cr in FY21. 

Employee benefit expenses jumped 218% to INR 110.6 Cr in FY22 from INR 34.8 Cr in FY21. Employee benefit expenses generally comprise employee salaries, PF contributions, gratuity, and other employee welfare benefits. The increase in employee benefit expenditure indicates that the startup increased its employee headcount. 

According to LinkedIn,Gupshup’s employee count stood at 311 at the beginning of FY22, which rose to 781 by the end of the fiscal year. Currently, the startup has over 800 employees. 

Gupshup’s advertising and promotional expenses also jumped 186% to INR 50.9 Cr from INR 17.8 Cr in FY21. In other words, the unicorn earned INR 22 in operating revenue in FY22 on every INR 1 spent on advertising. 

Founded in 2004 by Beerud Sheth, Gupshup is a conversational messaging platform that helps companies enhance customer experience. It claims to send over 7 Bn messages every month to enable conversations with customers and counts Kotak Mahindra Bank, IndusInd Bank, HDFC Bank, Ola, Zomato, Flipkart, among others, as its customers.

The startup last raised $240 Mn in a follow-on funding round to buy back shares from employees and some of its existing investors. Fidelity Management and Research, Tiger Global, Think Investments, Malabar Investments, Harbor Spring Capital, among others, participated in that funding round in July 2021. 

Gupshup entered the unicorn club in April 2021 by raising $100 Mn in its Series F round from Tiger Global at a valuation of $1.4 Bn.

The startup was on a shopping spree last year, acquiring four companies in the first five months of 2022. Gupshup competes against the likes of Yellow.ai, Skit.ai, and Leena.ai. 

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