ThoughtSpot, a software company formed to make data analytics accessible for business staffers without data science expertise, announced today it raised $248 million in a Series E funding round that set its valuation at $1.95 billion.
Sunnyvale, CA-based ThoughtSpot, founded in 2012, made it a core mission to enable its customers’ non-technical workers to mine company data themselves in order to get answers and make better business decisions in any field.
The democratization of such IT skills, often dubbed “self-service analytics,” is a feature offered in varying forms at other business intelligence firms ranging from IBM (NYSE: [[ticker:IBM]]) and Microsoft (NASDAQ: [[ticker:MSFT]]) to smaller companies such as New York-based Sisense and Tysons Corner, VA-based MicroStrategy (NASDAQ: [[ticker:MSTR]]). Tableau Software (NYSE: [[ticker:DATA]]), a company seen as a ThoughtSpot competitor, was acquired by customer relationship management giant Salesforce (NYSE: [[ticker:CRM]]) this year in an all-stock deal valued at $15.7 billion.
ThoughtSpot co-founder and executive chairman Ajeet Singh says many companies that make data analysis easier to carry out still aim to serve developers and analysts, rather than the sales managers, healthcare administrators, and other ordinary business decision-makers that ThoughtSpot wants to empower.
“We’re the only company focused on the business user as the primary user,” Singh says.
Companies these days are generating so much data that they could never employ enough data scientists to answer all the questions that department managers and other staffers would like to bring to them, Singh told Xconomy in a phone interview.
Using ThoughtSpot’s software, retail managers could quickly query their company’s databases about product buying patterns that might help them plan for pre-holiday inventories of certain items, for example. The company also has an AI-powered feature, SpotIQ, that delivers answers to questions the user didn’t think to ask, Singh says. It might alert a merchant responsible for Nike Air shoes that the stock of men’s shoes in size seven is going down really fast in Sunnyvale, CA, he says. The user could then replenish the stock to avoid losing extra sales of that footwear.
ThoughtSpot’s fundraising has been escalating at a steady rate. A $50 million Series C funding round announced in May 2016 was followed by a $145 million Series D round two years later, in May of 2018. The new funding announced Wednesday was quicker to arrive, and brings the company’s fundraising total to $554 million.
New investor Silver Lake Waterman, the late-stage growth capital fund of technology investment firm Silver Lake, participated in the funding round along with previous investors Lightspeed Venture Partners, Sapphire Ventures, and Geodesic Capital.
With its new money, ThoughtSpot plans to continue its market expansion in North America, Europe, Asia, and other regions. The company will also beef up its research and development teams, particularly in India, where it aims to locate more than half of its R&D workforce by the end of next year, CEO Sudheesh Nair said in a phone interview.
The company says its customers include Walmart (NYSE: [[ticker:WMT]]), BT (NYSE: [[ticker:BT]]), Hulu, Daimler, 7-Eleven, PetCo, and Rolls Royce. During the first half of ThoughtSpot’s fiscal year, which began Feb. 1, sales grew by 195 percent compared to the same six-month period in 2018, Nair says. If sales continue at the same rate as last quarter’s, ThoughtSpot’s revenue for the full year would come close to $100 million, he says. The company’s staff increased by more than 65 percent to nearly 500 employees over the past year.
Nair joined ThoughtSpot as CEO in July 2018 after serving as sales organization leader and later president of Nutanix, a cloud infrastructure company that Singh co-founded in 2009. In 2016, Nutanix (NASDAQ: [[ticker:NTNX]]) completed that year’s largest venture-backed initial public offering, when its last private valuation was $2 billion—about the same as ThoughtSpot’s valuation is now.
With its new funding, ThoughtSpot has no financial reason to go public, Nair says. Company leaders are focused on in-house improvements before they take that step. But advantages could flow from operating with the transparency required after an IPO, he says.
“Global 2000 customers like to work with public companies when it comes to writing big checks,” Nair says.
As for Singh, he says people are always asking him whether he’s ready to found his next startup. He not only says no, he says never.
“I have two ‘kids’ and we’re done,” Singh says. “This is my last startup as an entrepreneur.”
Instead, he keeps working “crazy hours” as he leads engineering and product development efforts at ThoughtSpot.
“There’s so much more to be done,” as companies keep generating more and more data that could make them more productive if it were mined for insights, Singh says. “The problems are growing faster than the solutions.”
Photo by Markus Spiske on Unsplash
