Fractal Analytics Raised $100 Million From Khazanah, Malaysian Sovereign Wealth Fund

May 11,2016: Fractal Analytics, a data analytics company founded in 2000, has raised $100 million (Rs 667 crore) from Malaysian sovereign wealth fund Khazanah in one of the largest investments in the technology ecosystem in 2016.

According to a source directly familiar with the development, the investment will value the US and India-based company at close to $300 million (Rs 2,000 crore), as the company is looking to embark on an aggressive inorganic strategy.

Fractal Analytics said that the funding will be used to accelerate its growth, investing in areas like artificial intelligence (AI) to snag Fortune 500 clients. It counts multi-nationals like Franklin Templeton Investments, P&G, Kimberly Clark, Microsoft and Philips as its clients.

According to the latest forecast from Gartner, Global revenue in business intelligence and analytics is expected to reach $16.9 billion in 2016, an increase of 5.2% from 2015. The cofounder of Fractal Analytics, Srikanth Velamakanni, said “There is a revolution underway in advanced analytics, deep learning and visual storytelling. Analytics as we define it may get transformed and the investment from Khazanah will help us invest further in our AI & deep learning-based software stack”.

The firm has developed several AI-based analytics product, including one in the healthcare space. It has also launched AI-based personal assistant called Cuddle, which helps enterprises and executives understand what they need to know right now for making decisions.

The large financing round is also expected to be used for acquisitions, besides expansion and product. Imagna Analytics, an artificial intelligence startup and Mobius Innovations, a mobile-based contextaware big data startup are two acquisitions closed by Fractal in 2015.  Mobius was launched by Fractal’s cofounder Nirmal Palaparthi in 2012.

Currently with five acquisitions in the pipeline, Fractal Analytics is working on evaluation.   “We will look to acquire companies for the IP that they bring in clients who we don’t have right now,” said Velamakanni, adding that it only looks to onboard clients who either have revenues of over $10 billion, market capitalisation of over $20 billion or have over 30 million customers.

Inception of Fractal

Founded around the first dotcom bubble 2000, Fractal for the first 10 years found it tough to sell analytics to clients in India but has been growing at 60% compounded annual growth rate over last six years. The company now has over 13 offices, with major centers in Mumbai and San Francisco. Fractal founders include IIM-Ahmedabad post graduates Velamakanni, Palaparthi and Pranay Agrawal. Two other cofounders — RK Reddy and Pradeep Suryanarayan — left after a legal dispute erupted between the founders in 2007.

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