Freshworks is one of the more interesting SaaS startups that has reached the scale of being a viable and reliable long term business. It originated in Chennai, which at the time of founding in 2009 was not a hub of technology perhaps aside from a then-nascent Zoho.
As an aside, Chennai is now on the rise from a tech perspective, looking to attract skills and dollars from the larger Indian centres such as Bangalore and Delhi. Freshworks, Zoho and others can take credit to as drivers for the rise of Chennai as an innovation and employment hub.
Freshworks was one of the quickest SaaS providers to grow from US1M to US$100M in revenue, doing so in just over five years, beating ServiceNow and Shopify to this metric. Starting as Freshdesk, it has expanded to offer ten key products all centred around customer experience. The breadth of the portfolio is, therefore, significant for a relatively small company with the related challenges and opportunities that this presents.
In September this year, Freshworks held the Refresh19 customer and partner conference. It attracted over 500 customers to Las Vegas the week after Labor Day, and also had its inaugural industry analyst day. Refresh attendees had doubled from the 2018 Refresh18 event in New York, showing the interest in Freshworks and the importance that enterprises are placing in a unified customer experience and engagement platform. The growth in attendance reflected the client investment in the firm and the increase in capabilities that it has invested in recent years.
The analyst day was attended by a small but hand-picked assortment of analysts. The Freshworks executives certainly were made aware of the collective and individual perspectives of the analysts, and to the executives’ credit, they appeared to relish the at times, pointed advice.
Freshworks started as Freshdesk providing cloud-based customer support software. Due to the growth in capability, and for precise strategic purposes, Freshdesk became Freshworks, with Freshdesk remaining as an anchor product. There are now nine other products in the Freshworks offering portfolio. Key product offerings include:
- Freshcaller – Contact Centre
- Freshservice – IT Support Management
- Freshmarketer – Marketing Automation and Support
- Freshconnect – Customer and Employee Collaboration
- Freshsales – Sales Support and Management
The two most recent offerings announced at Refresh19 were
- Freshrelease – Project Management
- Freshping – Website Availability and Management
As mentioned, revenue is US$100M and growing; success is more than marketing and talk. One of the critical success factors of Freshworks highlighted at the event is customer satisfaction. For any SaaS firm (let alone every single firm or government agency) customer satisfaction is the anchor for renewals and expansion of investment. Engaging with some of the 555 customer attendees, it was clear that there was a high level of customer satisfaction with the investment in Freshworks and with the overall experience and business outcomes generated by this investment. Freshworks wants it’s customer’s customers to be customers for life. It wants that on the Freshworks platform directly or through the required marketplace.
Freshworks has strong leadership and has not been afraid to bring talent into the organisation to enable the next phase of growth, positioning and customer narrative. Expansion globally has accelerated, with three offices in Europe, two in Australia and one in Singapore alongside India and Silicon Valley. The technology is touted as easy to install and easy to use, which enables deeper penetration. Simplicity is a crucial mantra for Freshworks; it has taken an IKEA view of the world to the development of the product set. Given this philosophy, it is not surprising that French sporting goods retailer, Decathlon, an IKEA for sporting goods is a client.
Of course, there is more that needs to be done by Freshworks. capioIT suspects that more cross-selling is required to boost the average number of products used per customer, particularly for the traditionally targeted small to mid-market customer. As it looks for more enterprise engagement, it will have to engage more with SI’s rather than the current partner base, which is more technology vendor and fellow SaaS provider-based. It also must develop a stronger position in terms of security, and how to ensure that clients understanding of the role of security is paramount.
Freshworks have had success so far in providing customer experience based SaaS platforms for clients. This success has enabled it to scale past US$100M in revenues and to become a key player in the marketplace. This success can continue on the back of the philosophy of making technology more accessible, and customer engagement easier for clients. Clients are, of course, the ultimate judge and the run to US$200M and beyond will be the measure of how successful Freshworks can be in the future.