Mobile app developer Robosoft secures $3.7M in Series A funding from Kalaari Capital
Karnataka-based mobile app developer Robosoft Technologies Pvt Ltd has secured its first institutional round of funding from Kalaari Capital, the firm said on Monday. Robosoft, which builds apps for the iOS, Android and Windows platforms, earlier focused on the US market but is now gaining traction in Europe, the Middle East and India.
Although the quantum of funding was not officially disclosed, Rohith Bhat, founder and CEO of Robosoft, has told Techcircle.in the deal is worth Rs 22 crore ($3.7 million). As part of the deal, Sumit Jain and Kumar Shiralagi of Kalaari will join Robosoft's board as directors, he added.
The current funding is going to last for a year and a half and the company plans to raise a Series B round in the second half of 2014.
Robosoft was founded in 1996 by Bhat, a computer engineer who graduated from the NMAM Institute of Technology at New Udupi in Karnataka. As of now, it claims to have developed more than 1,000 apps with over 100 million downloads.
When Apple announced its App Store in 2007, Robosoft was one of the first firms off the block to build apps that went live in the store on Day I. The firm launched its fully owned app subsidiary called Global Delight and also came up with a fully owned gaming subsidiary 99Games Online. Part of the current funding will go into marketing some apps and games from these subsidiaries over the next 12 months.
According to Bhat, around 50 per cent of Robosoft's business comes from the US and rest is from India, the UK and the Middle East. India contributes 15 per cent of the revenues. In terms of customers for outsourced products business, the company has marked 25 per cent increase from last year. Bhat, however, did not share the number of clients it is working with.
The company will use a significant amount of the funding to expand its operations overseas and also to hire more people for sales and marketing. It currently has a team of 400 people.
"We will open offices in Dubai and London besides adding around 100 people, including 20 senior hires in sales, marketing and product development," shared Bhat. "About 40 per cent of the funds raised will be allocated to our subsidiaries," he added.
However, the focus will be on the parent firm (Robosoft) now as earlier, the company was allocating more resources to its subsidiaries to ensure that the products gain traction.
"The new investment from Kalaari will help us turbocharge our growth in new markets and across industry segments; add new sales, design and engineering talent to our team, and help us move toward a full-service model," he added.
Asked what he meant by a full-service model, Bhat said that till now, the company only provided app features suggested by clients. But with the new team in place, Robosoft will provide all kinds of app-related support, such as app designing and app strategies (which platform to use, what to offer in an app, etc.).
Commenting on the funding, Kalaari Capital MD Kumar Shiralagi said, "Robosoft's wealth of engineering talent, their successful track record of building consumer-facing products for some of the best brands in the world and their leadership position in the mobile services segment got us interested. Equally enticing were their initiatives in building global IP like WordsWorth, Camera Plus Pro, Game Your Video and Boom, and the amount of traction they already had there."
Talking about the current trend in mobile apps, Bhat said, "The trend is towards free apps or freemium models. Paid apps do not work unless they are renowned brands. For the past one year, we at Robosoft have seen that consumers are largely going for free apps."
For the venture capital firm Kalaari Capital, which is investing out of its second fund worth $150 million, this is the third deal since January this year. It has recently co-invested in Apalya Technologies and also put in money in a packaged food company.
(Edited by Sanghamitra Mandal)