Goldman Sachs Planning to Pump An Additional $30-50 Mn In MoEngage Via Secondary Deal

Talks to increase Goldman Sachs’ stake in enterprise software-as-a-service (SaaS) provider MoEngage with a $35–50 million secondary transaction investment are nearing completion.

This growth coincides with a rise in late-stage software as a service (SaaS) transaction activity; firms including Whatfix, Innovaccer, Icertis, Atlan, and Rocketlane have either completed funding rounds or are in the process of concluding them.

According to someone with knowledge of the situation, “Goldman has decided to buy shares (of MoEngage) from some of the early investors.” “This funding round is entirely secondary.”

According to persons with knowledge of the developments, deal activity has increased despite a considerable readjustment in SaaS funding valuation multiples over the past year.

For this Goldman investment, “the contours are still being finalized, but there may be a discount to MoEngage’s last valuation,” the person stated.

After a $77 million fundraising round led by Goldman Sachs and B Capital in 2022, the Bengaluru-based SaaS company with a marketing focus was last valued at $700 million (around 6000 Crore).

While MoEngage did not answer an email until Thursday around press time, Goldman Sachs declined to comment.

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International Finance Corporation (IFC), an arm of the World Bank, recently disclosed that it intends to invest $20 million in the SaaS company Innovaccer, which focuses on healthcare.

The US-based venture investor Meritech Capital and Singapore’s sovereign wealth fund GIC led the $105 million additional capital raise in May for the data collaboration software startup Atlan, almost tripling the company’s valuation to $750 million following the transaction.

All of this emphasizes how many large- and mid-sized software startups are making deals. According to statistics from Venture Intelligence, SaaS investments suffered a downturn last year across company stages. Private equity and venture capital funds gave late-stage SaaS companies $1.53 billion in 2022; however, in 2023, the sum plummeted to $421 million. SaaS funding for mid-stage firms fell from $2.1 billion in 2022 to $920 million in 2023.

MoEngage was founded in 2014 by Yashwanth Kumar and Raviteja Dodda, and since then, company has raised $182 million in funding. Among its backers are Eight Roads Ventures, Matrix Partners India (formerly known as Z47), and the private equity firm Multiples.

Leading customer engagement platform ‘MoEngage’ is using a diverse approach to strategically position itself to benefit from the growing SaaS industry. Realizing the growing significance of tailored customer experiences, MoEngage is significantly boosting its investments in artificial intelligence and machine learning technology to improve its automation and analytics capabilities. This makes it possible for companies to provide highly relevant and targeted interactions over a variety of channels, increasing customer happiness and retention.

MoEngage is building more regional support and sales teams in order to broaden its global presence and strengthen its market position. Better service and a quicker uptake of their platform are made possible by this deeper comprehension of the peculiarities of local markets and client needs.

Additionally, in order to give consumers access to a more complete ecosystem that facilitates seamless interoperability and improved functionality, strategic alliances and integrations with other important SaaS providers are being pursued.

Reported infusion of $30-50 Mn In MoEngage by Goldman Sachs will further bolster position of the SaaS startup to remain ahead of the curve. With such a massive investment, we can definitely expect a lot of emerging technology integration and expansion of it’s skilled workforce.