Advent International-backed data science and analytics firm Tredence Inc. is looking to roll out its inorganic growth plans with its debut acquisition this year, said co-founder Shashank Dubey.
In an interview, Dubey said the company will pursue a smaller deal instead of a major transaction for its first acquisition. He did not disclose the estimated size of a potential deal and how it would be funded.
The Bengaluru and San-Jose-based firm counts its three co-founders—Dubey, Sumit Mehra and Shubh Bhowmick as the majority shareholders.
Private equity firm Advent International, which invested in a $175 million Series B funding round last week, and Tredence’s Series A investor Chicago Pacific Founders (CPF) also hold board positions as minority stakeholders.
The latest deal, which valued Tredence at over $500 million, also saw CPF’s stake drop to less than 10% from the high 20’s earlier. “They still have a stake in Tredence because they are still betting on us,” Dubey said.
“From here on, we are looking at growing across multiple dimensions, and with that in mind, we thought we need a partner who can work with us for the next 4-5 years, with a global reach and muscle power,” Dubey said, explaining the rationale behind adding Advent as a board member.
In calendar year (CY) 2022, Tredence crossed $100 million in revenue, which it aims to grow to $170 million by the end of 2023. The goal is to hit half a billion dollars in revenue by 2026, Dubey said.
The company has centered its inorganic growth strategies around three dimensions.
“One is geography, which could include acquiring new markets. Europe is a prime focus for that,” Dubey said. “The second is industry capability. We are betting heavily on starting banking and insurance, and healthcare and life sciences as industry verticals in CY 2023,” he said.
The third dimension, he said, is focused on specific skill sets, particularly on data engineering and data science. Tredence aims to open nearshore delivery centres which will include expanding its presence in Toronto, Canada, and setting up a nearshore centre in Latin America.
Tredence currently has a team of about 2,000 people, about 80% of whom are in India. By the end of 2023, the company expects to grow the workforce to 3,000 people.
“This means, we’re looking at hiring around 700 people in India alone, and another 200-300 people in other geographies,” Dubey said.
On plans for a public listing, Dubey said there is no plan for an initial public offering (IPO) anytime soon as the company would seek to retain its private status to maintain its autonomy, which he said, would be instrumental in enabling growth through experimental projects.
“We are in a stage where we want to build newer capabilities, take some bets, and craft a non-linear growth trajectory. We want to have that freedom and autonomy to do those experiments to take Tredence to the next level of revenue and profitability,” Dubey said, reiterating the data science firm’s focus on its growth milestones in an industry fraught with rising cost pressure from customers in a high interest rate regime.
