US-based SaaS start-up Zenoti has raised around $50 million in the series C funding round.
This funding round was led by the prominent New York based investment fund Tiger Global.
The company provides cloud based back end services to salons and spas.
US-based SaaS start-up Zenoti has raised around $50 million in the series C funding round. This funding round was led by the prominent New York based investment fund Tiger Global. Existing backers which include venture funds Accel partners and Norwest Venture partners also participated. Zenoti which was formerly called Managemyspa is now valued at $71 million.
Zenoti was founded by Sudheer Koneru, Dheeraj Koneru, Anand Arvind and Saritha Katikaneni in 2010 and has offices primarily in Seattle and Hyderabad. The company provides cloud based back end services to salons and spas. Apart from this, Zenoti also provides services such as inventory management, booking appointments, employee payroll and financial management to its clients. It also boasts of helping its clients increase their revenues by 5-10% each week. Currently Zenoti is present in around 45 countries and it seeks to expand its presence further.
The client list of the company comprises of big names such as Lakme, Taj hotels and MGM resorts. Apart from these, they also serve a host of salon chains in the US such as Mario Tricoci and Sono Bello.
Tiger Global which led the funding round of Zenoti has recently amped up its investment policies in India. They have started a $3 billion fund which is named Tiger Global Private investment partners XI for making investments in India and China. In May 2018, the firm made a profit of $3.4 billion against an investment of $1 billion when it sold its stake in Flipkart to Walmart. Tiger global has been keenly interested in companies that provide solutions to niche markets. Zenoti fits the bill of niche operating companies that Tiger Global has been recently investing in. According to its founder, Sudheer, there are a variety of companies that provide desktop software for backend management of salons and spas but hardly any of them are cloud based. Sudheer further emphasised that their nearest competitor isn’t even as large as Zenoti is
The funding raised by Zenoti will be primarily used to fasten the pace of innovation at Zenoti. The company also aims to automate the operational process and expand marketing. It also looks to broaden its horizons by looking into artificial intelligence and predictive analysis and expand sales.
Currently Zenoti is estimated to be valued at $10 billion and employs around 300 people in its teams. More than half of the company’s revenue comes from the US market with India having only 20% of the share. Zenoti charges upto $500 per month for its services in the US, however the price of their services in India is only $120. It has achieved a growth of 100% over the past year and aims to achieve a growth rate of 130% in 2019. Apart from this, Zenoti also aspires to increase its taskforce in India by 50% in the fields of machine learning, data analytics and R & D. Thus, Zenoti is using technology to elevate the spas and salons market and growing it exponentially.
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