SUMMARY
The company is now valued at around $600 Mn after the $90 Mn funding round led by SoftBank
Whatfix will be investing heavily into bolstering its tech stack and going deeper into Western markets
It will focus on personalisation, intent-based nudges and insights through the use of artificial intelligence technologies
In 2021, businesses are not only moving towards automation and digital transformation, but entire workforces have to learn new ways of doing things and workflows have changed tremendously. What used to be left to physical meetings and documentation-heavy processes is being handled more effortlessly now, but that doesn’t mean all enterprises are growing at the same pace.
Many are grappling with the new workflows and software-driven operations that come with such a massive transformation, which is why digital adoption is a major challenge in today’s business environment. Bengaluru-headquartered Whatfix is looking to change the way enterprises and corporations onboard new employees, train them, or manage their daily operations through various disparate software.
Founded in 2013 by Khadim Batti and Vara Kumar, Whatfix enables enterprises to maximise productivity over digital tools and project management applications or software besides enabling employees to automate parts of their workflow. It claims to increase the return on investment (ROI) on enterprise software by mapping non-use or overuse of software, while also enabling training of employees in various processes.
Whatfix enables automation in menial tasks by seamlessly integrating with popular customer resource management (CRM) or enterprise resource planning (ERP) tools. As one can imagine, such digital tools have seen massive upsurge in adoption in the past year as digital transformation became a top priority for businesses. And naturally, Whatfix has managed to capitalise on this rising tide.
Whatfix has today announced a $90 Mn Series D round led by SoftBank Vision Fund 2. The bulk of this funding, cofounder Batti told Inc42, would go towards strengthening the tech platform, and building artificial intelligence innovations for personalisation that will offer Whatfix a competitive moat in this space.
The round also saw participation from Eight Roads Ventures, Sequoia Capital India, Dragoneer Investment Group, F-Prime Capital and Cisco Investments. These investors had backed the startup in its Series C round last year. Overall, Whatfix has now raised $139.8 Mn with the company’s valuation seeing a 3X bump in the past 15 months. Inc42 has learnt that the company is now valued at around $600 Mn after this round.
Essentially, Whatfix enables enterprises to maximise the outcomes from application training, learning, and support content by providing contextual, interactive, real-time, and autonomous user guidance. “Each individual (employee) uses around 15 individual pieces of software to get the job done. Companies are spending hundreds of millions of dollars on digitising the processes but the ROI is only possible if employees use all the software and utilise them effectively. That’s when it will reflect back to a desired outcome,” Batti said.
It claims to be driving digital adoption gains in key aspects, such as employee productivity by 35%, reducing training time and costs by up to 60%, reducing support tickets by 50% and increasing application data accuracy by 20%.
Whatfix is applicable on all software that an enterprise uses, but to simplify the go-to-market, it is targeting solutions for CRM and human capital management or HCM because every enterprise will typically have a stack for these. It’s an entry point and then based on the particular needs, Whatfix is able to build more and more advanced guidance for the employees and the various software used. “A third of our customers use Whatfix on two or more applications, almost 5% of customers are using it on more than 10 applications. As we keep scaling we can go with close to 200 applications within that enterprise.”
Besides working with enterprises to improve employee engagement and productivity, Whatfix also enables software developers to improve onboarding of users and guide user journeys. The startup’s cofounder added that for customer facing software, it works with product makers, but that’s a small part of the business. “Almost 90% of our focus right now is on employees. Because the problem is very huge given the pace of digital transformation and how companies have bought new software. So the applicability of Whatfix is huge within those organisations.”
The Whatfix Tech Stack
In October 2019, Whatfix acquired Airim, a tech company that provides AI-powered personalisation engines for users and customers.The acquisition was Whatfix’s formal entry into the AI-based personalisation domain.
And since then the company has been building more innovation to help customers speed up their workflow. For its next phase of product development, Whatfix will focus on personalisation, intent-based nudges and insights through the use of artificial intelligence technologies such as natural language processing (NLP), machine learning, predictive analytics and more.
Batti said the goal is to make the experience more relevant for the user by giving the right nudges to help complete tasks in two minutes, which might have taken hours otherwise. It’s as simple as reading the contents of a client’s email and nudging the employee to add it to the CRM with all the details pre-filled. Or it can be personalisation in what nudges are shown to which employees based on their experience levels or past usage.
“The employee might have procrastinated in the earlier workflow or may have delayed entering the information, but now actually it’s done within a minute with just one click. So this is a combination of automation across applications, learning the intent, and also historical information to identify what template and other things to be used for a task.”
Western Markets Embrace Digital Adoption Services
With the new round, the focus will be on growing the presence in the US market and accelerating global expansion into Europe, Australia and Asia Pacific. The company has opened new offices in Germany, UK and Australia recently, and has grown to a 500-member team now, the cofounder said and the goal is to use this scale to penetrate deeper into each market.
Batti added that 75% of Whatfix’s customers and revenue comes from the US market, while around 18% to 20% of it comes from Europe, which is dominated by the UK, Germany, Italy, France, Netherlands. The rest comes from other countries, which includes at least 3% or 4% contribution from Australia.
But what about the Indian market? India does not figure prominently among the company’s customer base despite one or two big enterprises in India adopting Whatfix. Batti says it is changing in the wake of the pandemic. “Twelve months back, I was thinking of focusing only on the US and Europe markets because, of course, that market has huge potential to grow for the next several years. But since then we have started seeing a lot of inbound inquiries from India and Southeast Asia. A couple of quarters back we started ramping up the sales team for this region, which was like two or three people a year back and is now almost close to 10 people.”
But in terms of the business potential, India has a long way to go in the digital adoption services market. “We have a relatively small footprint in India, but our average ticket price would be 35% lower compared to the other markets.”
Given the rather nascent stage of digital adoption in India, the profile of companies approaching Whatfix is also different in India than in the US and Western Europe. Batti claimed India’s tech companies, product startups, and next-generation companies are looking to adopt Whatfix, whereas the audience profile is spread out across categories in other markets. Surprisingly, the needs of the Indian user are more nuanced than those in Western countries, since the user is more tech savvy given the sector.
It caters to over 500 enterprise clients comprising more than 100 ‘Fortune 1000’ brands, including Western Union, Wipro, Experian, Sentry Financial Services, Cardinal Health Canada, BMC Software, Bausch & Lomb among others, besides ICICI, Mahindra & Mahindra in India. Given its bigger focus on the US market, Whatfix competes with other global digital adoption services and tools such as Pendo, WalkMe, Appcues, Userlane, Apty, Inline Manual among others.
