The AI industry has been growing steadily in recent times. In fact, the global AI market was said to clock a CAGR of 33.6% from 2021 to 2028 and come at $360.36 billion by 2028. This is quite impressive, considering that AI is an indispensable part of the digital era and its use is widespread across sectors. The pandemic did not dent the growth of the AI industry either, as it was used extensively in the healthcare sector over the past two years.
The growth of the industry has proved to be beneficial for startups such as Fractal, which is already a prominent player in the AI sector. Becoming a unicorn, though, was long overdue, and that has finally happened for the over-a-decade old upstart.
Fractal has entered into a definitive agreement to raise $360 million from private investment firm TPG Capital in its latest financing round, which catapults its valuation to over $1 billion. $1 billion is the threshold that companies have to cross (in terms of valuation) to be considered as unicorns.
The round includes a mix of primary investment and secondary share purchase from funds and was advised by Apax Partners. It is expected that the deal will close in the first quarter of the year.
The proceeds from the funding round will be utilized for driving investment in products and more mergers and acquisitions in the future. Fractal is already investing nearly 15% of its revenue for mergers and acquisitions, according to Fractal co-founder and Group CEO Srikanth Velamakanni. It is also keen on deepening its footprint in the Indian market.
After the financing round, TPG’s Puneet Bhatia and Vivek Mohan will be joining Fractal’s board of directors. They will be serving alongside Fractal’s current directors, including Gavin Patterson, Rohan Haldea, Shashank Singh, and Gulu Mirchandani.
Fractal, founded by Srikanth Velamakanni, Pranay Agrawal, Nirmal Palaparthi, Pradeep Suryanarayan, and Ramakrishna Redd, is known to provide AI and advanced analytics solutions (such as marketing analytics, forecasting, pricing, and promotion optimization services and consumer insights) to Fortune 500 companies. It has come a long way since its inception in 2000 and has It has raised $685 million in fundraisers to date.
The startup’s offerings include Qure.ai, Theremin.ai, Eugenie.ai, Crux Intelligence, Samya.ai, and Senseforth.ai. It has over 3,500 employees across India, Ukraine, UK, US, Australia, Singapore, and others, and claims to clock $100 million in annual revenue. It is also targeting about $190 million in revenue in FY22 and going public in the future, though no date has been given yet.
