Gupshup was valued at $1.4 billion when Fidelity first invested in the company back in 2021 through a secondary transaction. The asset manager has been steadily revising the value of its holding and had marked it down to $697 million as of July 2023.
Last July, Gupshup raised $60 million in a mix of equity and debt financing but did not reveal its valuation at the time. The company had said then that the fresh capital would be used to expand its artificial intelligence (AI)-driven messaging platform and accelerate go-to-market execution across high-growth regions, including India, the Middle East, South America and Africa.
The San Francisco-headquartered company had also said it was exploring a shift in domicile to India with plans to list here.
Founded in 2004, Gupshup provides messaging APIs and conversational tools to businesses and has more recently focused on AI-powered customer engagement solutions.
Ongoing churn
Over the last few years, the company has witnessed a churn in its business, which led to it laying off 300 employees to streamline operations after a period of rapid growth.
In fiscal year 2025, Gupshup’s India unit reported a 5% drop in revenue to Rs 1,943 crore while its net profit contracted 52% to Rs 26 crore. India is Gupshup’s largest market, accounting for about 60% of its revenue, with the remaining 40% coming from other countries.
Around 60% of Gupshup’s customers are large enterprises, spanning the ecommerce, retail, payments, fintech, media, travel, automotive and banking sectors. The rest are small and mid-sized businesses.
AI impact
The latest valuation markdown comes at a time when traditional software and services companies are witnessing an impact of disruption caused by artificial intelligence-based solutions.
Valuations for conventional SaaS as well as IT services companies are being re-rated by global investors in this scenario.
Crossover funds such as Fidelity, which invest both in publicly traded and privately held companies, review the valuation of their portfolio companies periodically. The fair value of private companies is ascertained on the basis of a number of factors, including business metrics, macro indicators as well as the stock market performance of comparable peers.