Decoding a Jungle Ventures-backed SaaS firm’s profitability

“We entrepreneurs say this to each other, that overnight successes take 10 years. It’s really been that story for us,” Suresh Shankar, founder and CEO of data analytics firm Crayon Data, tells Tech in Asia. The Singapore-based startup, which was launched a decade ago, turned profitable in 2021. It posted a net income of US$1.8 million during the year from a loss of nearly the same amount in 2020.

Suresh Shankar, founder and CEO of Crayon Data / Source: Crayon Data

The company expects to be profitable this year too. Shankar attributes the results to the firm building a model over the last five years that “wins in the real world.” Instead of chasing vanity metrics like valuations, the company believes in a model of sustainability, profitability, and capital efficiency, he explains.

This philosophy reflects in the SaaS startup’s financials for the last six years. Data from VentureCap Insights shows its operating loss has gradually reduced as its revenue increased. Crayon Data now expects to see its revenue grow by 50% by the end of this year. This would bring its revenue to about US$16.8 million in 2022 from US$11.2 million a year earlier.

The company’s data analytics platform, Maya.ai, uses machine learning and artificial intelligence to give financial institutions and fintech firms detailed audience insights through analysis of their customer data. The platform helps them offer personalized solutions to their customers. Shankar compares this approach to what Spotify does – the audio streaming giant has 200 million songs, an equal number of users, and about 40 quadrillion choices, but everyone’s playlist is still unique.

The company’s earnings turning black was due to a large revenue growth in 2021 – it more than doubled during the year. In comparison, the firm’s revenue rose by just over 20% year on year in 2020.

Crayon Data is now looking to raise US$40 million to US$50 million in a new round of funding by early to mid next year. The funding will go into its expansion plans in the US and European markets in 2023 even as it expects its revenue from India and Southeast Asia to significantly grow in the near future.

The company currently operates in the Middle East, India, and Southeast Asia, with offices in Dubai, Chennai, and Singapore. It has raised a total of US$23 million to date from investors such as Seeds Capital and Jungle Ventures, as well as Tata Group chairman emeritus Ratan Tata and Infosys co-founder Kris Gopalakrishnan.

Revenue analysis

It’s not only in 2021 that the company saw a jump in revenue – over the past five years, its revenue grew by 7x.

Crayon Data has only one major source of revenue: the service fees it charges its B2B clients. The company says that 90% of this is recurring revenue that mostly comes from subscriptions of its Maya.ai platform. The rest comes from integration and deployment services for its platform to its clients.

Crayon Data’s leadership team / Photo credit: Crayon Data

Expense analysis

Bank balance gets a boost