Cloud-based CRM startup Capillary Technologies Pvt Ltd has raised $15.5 million in Series A round of venture funding from Sequoia Capital and Norwest Venture Partners (NVP) while existing investor Qualcomm Ventures also took part in the round. As part of the deal, Shailesh Lakhani of Sequoia Capital and Mohan Kumar of NVP have joined Capillary’s board of directors.
The company will use the funding to extend its offerings to retail-akin industries such as healthcare and hospitality, further penetrate the billion-dollar small retailer market in India and enhance its product portfolio to meet the requirements of a broad range of retailers worldwide.
Aneesh Reddy, CEO of Capillary Technologies, said, “Both Sequoia and Norwest have amazing track records in helping build significant companies – particularly in the Big Data and analytics sectors. We are looking forward to working with both firms as we invest further in our team and platform, expand aggressively into the Indian market and take our company to the next level."
“Capillary has demonstrated that it can scale up successfully and profitably by focusing on a segment that has been underserved by more expensive and complex solutions. We are happy to partner with the company in this next crucial phase of growth,†said Lakhani, managing partner of Sequoia Capital.
The company’s flagship product is inTouch, a Cloud-based CRM solution aimed at large enterprises and integrated with billing and point-of-sale outlets of retail chains. Capillary also offers a stripped-down version called TruTouch that targets smaller retailers (1-15 stores).
The Bangalore-based startup was set up in August 2008 by IIT Kharagpur alumni Reddy, Krishna Mehra (VP – products and services) and Ajay Modani (VP – operations). Incubated by IIT Kharagpur with a soft loan of Rs 15 lakh, Capillary raised its first round of angel funding from Harminder Sahni, Naresh Malhotra and Qualcomm ($100,000 as the winner of QPrize). In January 2011, it raised a second round from Sahni and Malhotra besides new investors Rajan Anandan and Venkat Tadanki, along with a few others. The company had paid back the incubation loan to IIT Kharagpur in February 2011, after it became profitable in mid-2010.
Capillary has offices in India (Delhi, Bangalore and Mumbai), Singapore, the UAE (Dubai), the UK (London) and South Africa (Johannesburg). As of May this year, it was processing around eight-and-a-half million transactions on a monthly basis. It is currently working with more than 100 major brands and is reaching out to 50 million consumers. Also, the company is catering to over 10,000 paying merchant outlets in India, the South-east Asia, Greater China, the Middle East, South Africa, the UK and the US.
Its customers include companies like Raymond, Pizza Hut, Puma, United Colors of Benetton, Peter England, Store21, Robinsons and Nike, among others. The company claims to have captured over 60 per cent of the organised retail sector (over the past 4 years) to become the largest retail CRM provider in India.
Promod Haque, managing partner of NVP, said, "Capillary is helping its customers drive dramatic same-store sales increases – in some cases close to 10 per cent – and has an enormous opportunity to expand its offerings globally in what is still a hugely untapped market."
“We have witnessed one of the largest Series A funding for a technology product company in India and that validates that we are on the right track,†said Modani.
In terms of enterprise-installed solutions, Oracle and SAP CRM are among the company’s competitors. Note that Capillary is a Techcircle Fastrack company and one of the top 10 SaaS startups in the country, listed by us. You can also read the full profile of the company here.
(Edited by Sanghamitra Mandal)
