Decoding Whatfix’s Series D round and shareholding pattern

On Tuesday, B2B digital adoption solutions provider Whatfix became the third Indian startup to receive funds from SoftBank Vision Fund 2 in 2021. The Bengaluru-based company, which largely operates in global markets, has now raised $90 million in its Series D round.

While the company did not disclose much details such as its current valuation or the split of the round, Fintrackr has analysed the numbers and data made available in the company’s regulatory filings to decode the current shareholding structure of the seven-year-old firm.

Whatfix’s board has approved the allotment of 10 equity shares and 45,273 Series D preference shares at an issue price of Rs 1,43,973 per share to raise Rs 652 crore or $90 million, the filings show.

SoftBank, through its Vision Fund 2, has led the round with Rs 547.6 crore or $75 million investment. Existing backers Eight Roads Ventures, Sequoia Capital India and Dragoneer Investment Group have invested $4.8 million, $3.5 million and $3.3 million respectively.

F-Prime Capital and Cisco Investments invested the remaining amount.

According to Fintrackr’s estimates, Whatfix has raised this round at a post-money valuation of  $580-595 million. This is a 290% jump in its valuation from around $150 million during its $32 million Series C round in February 2020.

Fintrackr has also crunched Whatfix’s current shareholding structure in which its early backer Helion Venture Partners has emerged as the largest shareholders with 14.38% stake. Following the fresh allotment of shares, SoftBank has acquired 14.04% equity in Whatfix followed by Sequoia, Eight Roads and Stellaris with 14.02%, 12.62% and 12.32% stake respectively.

Khadim Batti and Vara Kumar Namburu, the co-founders of Whatfix, hold a collective stake of 17.60%. The complete shareholding structure can be seen below.

Whatfix was a part of bigger investment plans for SoftBank in India. The Japan-based storied investor had recently revealed that the total investment through Vision Fund 2 could go up to $4 billion by the end of this year. It has already invested around $2 billion in Indian startups including Meesho and Zeta in 2021.

Media reports in the recent past have suggested that Vision Fund 2 may invest $300-500 million in e-commerce marketplace Flipkart, $450-500 million in Swiggy, in talks to put  $100-150 million in OfBusiness, and all set to invest in Unacademy’s upcoming financing round.

The fiscal ended in March 2020 has been great for Whatfix, as its operating revenues shot up by 126% from Rs 27.45 crore in FY19 to Rs 62 crore in FY20. It earned non operating income of another Rs 7.05 crore through its financial assets. The company focussed heavily on marketing to push sales and its advertisement expenses jumped by 269% to Rs 50 crore in FY20. 

While there was a significant surge in revenues, Whatfix’s annual expenses almost tripled from Rs 41.96 crore in FY19 to Rs 124.33 crore in FY20. On similar lines, losses also jumped nearly 300% to Rs 55.3 crore in FY20.