Data analytics firm Tredence bets on GenAI to fuel growth over next 5 yrs

Data science and analytics firm Tredence, which recently became a unicorn and is valued at about $1.5 billion, is betting on the rapid adoption of generative artificial intelligence (Gen AI) projects to fuel its growth over the next five years, its co-founder Shashank Dubey said.

 

“If you use the multiple from our Series B fund raise, whatever the math we used while raising at that time, the same factor multiplied with my current revenue will value us at about $1.5 billion,” Dubey, who is also the chief revenue officer, told Business Standard during an interaction.

 

Backed by Advent International and Chicago Pacific Founders, Tredence raised about $205 million in two founding rounds till 2022 and will not need fresh infusion till another two years as it remains cash positive. 

 

The company, which counts Mars, PepsiCo and Unilever among its major clients, is expected to finish this year with a revenue run rate of $300 million, double of what it had in 2023. The target is to touch $500 million by 2027.

 

About $70 million will be fuelled by acquisitions while the rest from its growth verticals of retail & CPG, banking financial services and insurance (BFSI) and healthcare and life sciences.

 

Tredence, besides its regular business of helping companies optimise their cost through traditional machine learning (ML), analytics and AI, is also banking big on Gen AI which is expected to contribute about 25 per cent, or $125 million, at least to the topline in the next two years. 

 

The traditional deals are also growing because clients are looking for more cost efficiencies at a time when there is still the overhang of tariff uncertainty and the geopolitical turmoil. Such areas of cost pruning include the supply chain, life cycle and marketing or even diversifying sourcing and procurement.

 

Most of these Gen AI deals are platform deals or application and solutions ones, which involve creating the foundation or orchestrating the data from a client’s various sources to improve the efficiency or returns. The other involves building Gen AI applications and solutions on top of the platform. While the former deals are usually valued between $5-10 million for three years, the other one is about $2-5 million for about two years. 

 

“GenAI got over its hype cycle a couple of quarters ago. The lab experimentation cycle is over. For most chief information officers (CIO), the mandate is to show value at scale. Hence, their perspectives are shifting from experiment to building for scale and value realisation, the reason why we are upbeat. We are seeing only project ramp ups” said Dubey.

 

But to get the right returns from such initiatives, the critical component remains data, which for most enterprises, still remains siloed. That makes it harder to build a platform or put a Gen AI layer because that requires data convergence.