Gupshup Raises $60M Funding - Unicorn Status in Question

Gupshup Secures $60 Million Funding, Valuation Remains Undisclosed

Gupshup, a messaging platform originating in India and achieving unicorn status four years prior, has recently completed a new funding round of $60 million.

However, the company is currently not disclosing its updated valuation following this investment.

Previous Funding and Valuation Adjustments

In 2021, Gupshup secured $340 million across two funding rounds, with investors like Tiger Global and Fidelity. This resulted in a valuation of $1.4 billion.

Subsequently, Fidelity reduced its internal valuation of Gupshup multiple times between 2023 and 2024, with the lowest assessment reaching $486 million.

Expansion Plans with New Funding

This latest funding, a combination of equity and debt from Globespan Capital Partners and EvolutionX Debt Capital, will be used to bolster Gupshup’s expansion into key growth markets.

These markets include India, the Middle East, Latin America, and Africa.

Equity and Debt Breakdown

While the precise allocation between equity and debt wasn't revealed, Gupshup’s founder and CEO, Beerud Sheth, indicated that the equity portion constitutes “a little more than half” of the total.

From SMS to AI Agents: Gupshup’s Evolution

Founded in 2004, Gupshup initially focused on enabling business-to-customer communication via SMS, capitalizing on a time when text messaging wasn’t free.

As communication shifted to platforms like WhatsApp and RCS, Gupshup adapted by offering chatbot services.

Now, with the rise of AI, Gupshup is facilitating the deployment of AI agents for businesses.

Growing Demand for AI Agents

“There’s a lot of demand coming from enterprises,” Sheth explained. “Everybody needs to build these AI agents, which work through messaging like RCS and WhatsApp or through voice.”

Supporting this demand is a key focus for the company.

Competitive Landscape

The market for AI agents is experiencing rapid growth, attracting significant investor attention.

Major tech companies, including Amazon, Google, and Microsoft, are also actively developing and integrating these agents into their platforms, intensifying competition.

Gupshup’s Competitive Advantages

Gupshup doesn’t perceive the increased competition as a significant threat.

The company highlights its large customer base – exceeding 50,000 customers in over 100 countries – and its history of innovation through strategic acquisitions and internal research and development.

Customization is Key

“Businesses cannot use simple foundation models off the shelf and just put them in front of customers,” Sheth emphasized. “They need a lot of customization to be done, and that’s where Gupshup comes in.”

Gupshup provides this crucial customization service.

Revenue Growth and Profitability

Since its last funding round in July 2021, Gupshup has reportedly tripled its revenue and improved its profitability.

However, the company did not disclose whether this growth translated into a higher valuation in the recent funding round, stating that the round was not priced.

Unicorn Status and Future Outlook

When asked about maintaining unicorn status, Sheth stated, “As a founder, you focus on value, and the valuation will follow.”

He affirmed the company’s commitment to operating with the ambition of a large-scale enterprise.

Product Enhancement and Industry Applications

The new funding will also be allocated to enhancing Gupshup’s product suite, which serves industries like automotive, banking, e-commerce, and retail.

Products include click-to-chat ads, an AI campaign copilot, agent assist, and campaign manager.

Message Volume and IPO Aspirations

Gupshup currently processes over 120 billion messages annually for its enterprise clients.

The company’s next major milestone is an Initial Public Offering (IPO).

IPO Planning and Potential Listing Locations

“We’re talking to all our advisors, lawyers, bankers, accountants, and so on, to figure this out,” Sheth said.

While a specific timeline hasn’t been established, an IPO could occur within 18 to 24 months.

Gupshup is considering listing on Indian stock exchanges, given the dominance of WhatsApp in the Indian market and the potential for easier communication with local investors.

However, a listing in India could trigger tax implications, potentially requiring additional funding.

External Factors Influencing IPO

“The IPO “is the one thing that we don’t control entirely. The calendar depends as much on external factors as it does on the company,” Sheth concluded.