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Tech Mahindra in the offing to buy stake in social business startup

Tech Mahindra

BANGALORE: India’s fifth largest IT services enterprise, Tech Mahindra is discussing a stake procurement in social business intelligence startup Simplify360, as a slice of strategic initiatives to be able to shore up SMAC (social, mobility, analytics and cloud services) offering to patrons.

simplify 360

The writing on the wall as of now reads that TechM from its barrio could buy a large minority stake initially with a clear roadmap to buy out Simplify360 in the next three years. Simplify360 — with a hybrid model of US and India hubs typical of product startups — has mandated PwC to assist identify a strategic investor.

Simplify360 empowers businesses with online sales lead generation, followed by consumer sentiment analysis, online reputation management, customer service, community management, social media research and for that matter brand auditing.

German enterprise software giant SAP, Japanese advertising and communications spearhead Dentsu and Adobe had also looked at the transaction, with some of them dropping out after preliminary talks. Valuation details of the 5-year-old startup could not be ascertained immediately.

It was however not certain that ongoing conversations with TechM would lead towards a definite transaction. The $2.7-billion enterprise is already a reseller of Simplify360 products, which is marketed to colossal clienteles as chunk of an integrated suite.

“Tech Mahindra is our business partner. They have a history of acquiring companies. Having said that, we have mandated PwC to help us identify a strategic investor,” alleged Bhupendra Khanal, CEO of Simplify360.

Simplify360 from its quarter had sought a strategic partner to pick up a minority stake and help it become one of the top five players in the social business. “We have not completely kept financial investors out, but it’s better if we get a strategic investor on board. We are open to offload a 20-25% stake and that’s our comfort zone,” Khanal supplemented.

Indian IT majors from their ends have been scaling up SMAC as standalone business verticals as it becomes a $6-8 billion opportunity for India’s more than $100-billion outsourcing industry. Previous year, Wipro invested $5 million in Axeda Corporation, which offers cloud-based service and software for managing connected products.

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Jawed Akhtar

A Journalist by interest and a Music Enthusiast by passion. Wedded to Mother Nature, Jawed indulges his aesthetics in travelling and reading books of varied genres. Having covered News stories for top Dailies in his formative years, that is, he is game for tryst with Technology at Techmagnifier.

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