Family offices of Bertelsmann, Dutch royals to fund growth at Flytxt

Family offices of global mass media major Bertelsmann and the Dutch royals have invested $11 million in Flytxt, a big data analytics player with a presence at Technopark here.

Speaking to BusinessLine , Vinod Vasudevan, group CEO, of the Netherlands-headquartered company, refused to reveal the valuation citing a confidentiality clause.

Family offices

This is the first instance of infusion of funds outside of the four European founding members, again family offices, who have invested ‘in more than one round.’

“With the same set of investors, you don’t bother if this is the first, second or third time. They keep investing in proportion. Employees are also participating through share options.”

The new investors are far from being venture capitalists. Flytxt has taken a position not to entertain companies as shareholders lest it gets swamped by their corporate influence.

Both new investors are also joining the board. In some sense it’s a major graduation of our business, Vasudevan said.

The Bertelsmann family will be represented by Brigitte Mohn who sits on the Bertelsmann board that is synonymous with Penguin Random House, among others.

Board reconstitute

Mohn brings in the governance culture of a large organisation, Vasudevan said. There are six others on the reconstituted board.

Of the two independent directors, one is a retired professor of tax law in Germany and the other, a data management expert.

Vasudevan himself will be an ex-officio member, and will operate from the Dubai office of the company.

Of the 350-odd employees, more than 250 are based in India, mostly at the Thiruvananthapuram development centre.

“We’ve raised the money for two purposes. One is that we’re aggressively expanding our presence in the market and scaling up sales and delivery.

Purveying new areas

“We have opened a sales office in Mexico now. We’re expanding in Dubai and the Middle East and reaching out to Singapore, Southeast Asia and Asia-Pacific.

Corresponding to that, Flytxt is entering new area of business outside of telecom. “We’re talking to partners for combining telecom and primary research information or enterprise consumer analytics with telecom consumer analytics.”

This now needs new product development. For instance, in Latin America you need to develop a product to suit Spanish and Portuguese customer profiles.

Half of the funds will go for expanding the field presence in terms of sales and post-sales. The other half will go into expanding product development and R&D capabilities. “We will need software engineers, data scientists...in this business, it is not just software.

“We’re looking at PhDs in economics, statisticians. We are already in an R&D partnership with IIT-Delhi. The R&D team will double in next two years,” Vasudevan said.

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