DarwinBox Becomes India’s First Unicorn Startup Headquartered In Hyderabad

India’s startups might be getting pummeled at the stock markets, but private startups are still earning votes of confidence from investors.

HR software startup Darwinbox has become India’s 84th startup to enter the unicorn club. The company raised $72 million in a funding round led by TCV, which is also an investor in Netflix, at a valuation of over $1 billion. This makes Darwinbox India’s fourth unicorn startup of 2022, after Mamaearth, Fractal Analytics and Lead School had reached the milestone earlier this year.

“The company intends to use the funding in hiring senior-level talent to catapult it to the next stage of growth as well as in R&D to finetune its products to cater to new geographies such as US as well as in building its brand,” said Darwinbox co-founder and product head, Chaitanya Peddi. “We are looking to enter the US markets this year. It will be a super force multiplier, but could become a substantial contributor to revenue in the next three-four years,” he added.

Darwinbox was founded in 2015 by Chaitanya Peddi, who had an MBA from XLRI Jamshedpur, Jayant Paleti, who had degrees from IIT Madras and IIM Lucknow, and Rohit Chennamaneni, who had an MBA from IIM Lucknow. They together built Darwinbox, which is a cloud-based HR technology platform that caters to end-to-end HR needs of companies across the employee lifecycle. The startup offers solutions for workforce management, payroll management, talent acquisition and people analytics.

Darwinbox now provides its services to more than 650 customers including Tata, DLF, Paytm, Swiggy and Adani Wilmar. Its products have 15 lakh users in 90 countries across Asia, Middle East and North Africa. The company has manage to become the only Asian-origin player on Gartner’s Magic Quadrant for enterprise cloud HCM, which is considered the gold standard for any software. While Darwinbox has won international acclaim, it still caters to plenty of Indian users — Darwinbox is one of the few Indian software unicorns whose revenue is mainly from India and not the US.

Interestingly, Darwinbox is the first unicorn startup from Hyderabad which still has its base in the city. Startups including Zenoto and HighRadius were founded in Hyderabad, but became unicorns only after shifting base to the US, but Darwinbox continues to be run out of the southern city as it has achieved unicorn status.

India’s SaaS story has already thrown several successful names including Freshworks, Zoho, Postman and others. There are reasons why Indian SaaS companies end up being so competitive — India’s high-quality software talent pool has managed to build world-class products, and these companies have a natural currency conversion arbitrage, paying salaries in rupees while selling products to international firms in US dollars. This is a model that could create many more successful startups out of India, and with newer cities like Hyderabad also entering the fray, India’s SaaS story seems to be only growing.