Gupshup is a business messaging startup that began travelling in India over 20 years ago and became a unicorn four years ago, attracting more than $60 million rounds, but maintaining a new reputation.
In 2021, Gupshup raised two funding rounds within four months, securing $340 million from notable investors such as Tiger Global, Fidelity Management, Think Investments and Malabar Investments. These rounds – the startup was the first in about a decade, cherishing Gupsup for $1.4 billion. However, Fidelity, which led the round following the Unicorn milestone, cut the startup's internal valuation at least three times between 2023 and 2024, lowering it to $486 million.
The new funding round, combining capital and debt financing from GlobeSpan Capital Partners and EvolutionX debt capital, is intended to help the San Francisco-based startup expand its presence across high-growth markets, including India, the Middle East, Latin America and Africa.
The startup told its founder and CEO Beerud Seth to TechCrunch that its equity parts are “more than half,” but will not reveal the exact debt portion.
Gupshup, derived from Indian slang, meaning “conversation,” began in 2004 as a platform that helps businesses connect with their customers through text messaging. Texting was not free at the time, and it became popular because people were looking for ways to send messages to friends and community groups. However, as communications moved from short messaging services (SMS) to WhatsApp and Rich Communication Services (RCS), the startups moved to these streets with chatbot services. Now that AI has become a catch-all term, and AI agents (software that can perform certain tasks on behalf of users) are everywhere, Gupshup now allows businesses to deploy agents.
“There's a lot of demand from companies. Everyone needs to build these AI agents. This works through messaging like RCS and WhatsApp. So there's a lot of demand and need to support them to build these agents,” Seth said.
Globally, AI agents have gained traction, and startups are attracting strong investors' interest in them. Tech giants such as Amazon, Google and Microsoft are also looking for ways to provide these agents to users through their own platforms. Results: Competition is intensifying.
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Gupshup does not consider rising competition a threat. Seth pointed to a substantial install base of over 50,000 customers in over 100 countries and a track record of product innovation driven by years of experience in business messaging, strategic acquisitions and internal R&D.
“Companies can't use simple basic models from the shelf, they just put them in front of their customers. They need to do a lot of customization. That's where Gupshup comes in. That's what we offer,” he pointed out.
Since the last round of July 2021, the startups have “trixed” their revenues and increased profitability, Sheth said. However, as this latest round was not priced, it is unclear whether it led to an increase in valuation.
“As a founder, you focus on values and the review continues,” Seth said when asked if he still considers startups to be unicorns. “We run ourselves to be a big company.”
In addition to expanding geographically, the startup aims to leverage fresh funds to enhance products used in industries such as automobiles, banking, e-commerce, fintech, media, payments, retail and travel. Its products include Click-to-Chat Ads, AI Campaign Co-pilot, Agent Assist and Campaign Manager.
Gupshup claims to power thousands of businesses with over 120 billion messages per year. Going forward, startups view IPOs as the next major milestone.
“We talk to all our advisors, lawyers, bankers, accountants and more to understand this,” Seth said.
Seth told TechCrunch that it could happen to TechCrunch after 18-24 months, but the startup doesn't have a specific timeline for its public list.
Gupshup is investigating whether it should be listed on Indian stock exchanges. This is a move that has strategic implications, as startups view India as a more lucrative market. Some of the reasons are easy to tell stories to local retail investors who are familiar with WhatsApp, and understand how Gupshup products, including AI agents, operate within the platform. However, because Gupsup is resident in the US, a flip to India could cause tax liabilities and require additional funds.
The IPO “is one thing we don't have complete control. Calendars rely on external factors, like the company,” Seth said.