BL Interview Data Analytics is moving from the fringes to mainstream: LatentView CEO

bl interview data analytics is moving from the fringes to mainstream latentview ceo thumb 1

In November last year, Chennai-based LatentView Analytics made a stellar stock market debut listing at a premium of 169 per cent. With the first anniversary of its public issue weeks away, businesslike caught up with LatentView Analytics CEO Rajan Sethuraman to understand what changed since going public, prospects for data analytics, the company’s growth and expansion plans and more. Edited excerpts:

You had a blockbuster IPO around the same time last year. How has the journey been since then?

The IPO itself was a significant milestone for us. We have been a quiet company and have been doing good work for the last 15 years for some of the marquee clients on the Fortune 500 list. Data analytics is still an emerging area. You don’t see massive $100 million deals in this space yet. A lot of organisations are still building it, like transaction processing systems, ERP and custom development. In these, they generate a lot of data, but making sense of it, and using it for optimisation and decision purposes is still a holy grail. That’s where data analytics and new technologies like artificial intelligence come in.

Is the awareness of data analytics solutions gaining momentum?

Data Analytics sits on top of the IT services stack, and companies are increasingly starting to look at it to help with their decision-making. As more investment is being made in the application from a transaction process system, they all generate tonnes of data. Unless one does something with the data and uses it for decision-making, one is not capitalising on the investment being made.

The transition is starting to happen. Data Analytics is still largely driven on the fringes by business sponsors and stakeholders. People who are responsible for making those decisions as opposed to being done by central CIOs and CTOs. That is where the big budgets are. In the last 18 months, we are witnessing data analytics moving from the fringes to the mainstream. There are still a lot of runways there when Data Analytics will really take off in a big way and become multi-million and multi-year spanning deals. We are in that evolving stage now.

Can you name a few clients who are working on such a transition?

We work with Adobe, leading in pivoting the entire organisation into a data-driven model. For every decision, there should be sound data with an analytical basis for that decision-making. Anybody who buys an Adobe product, subscribes to it, and uses it off the Cloud. The company can look at how the customer is using the product. They can tie consumer behaviour with the demographic data they already have and come up with a rich understanding of who needs what and what they should come up with in terms of products, services, marketing and packaging. We do a lot of work around the front end, like customer analytics and marketing analytics, to understand customers, customer segmentation, loyalty, cross-sell and upsell.

You also work for Uber, which should be generating tonnes of data. What do you do for them?

We started engaging with them around the pandemic when the mobility business took a big hit. They pivoted very quickly to Uber Eats, which became a mainstay during the pandemic, and that business became very important. We have been helping them on Uber Eats with what people are buying, and analytics help in coming up with the rightproposition and products. The data that’s generated can run into terabytes.

What’s your average deal size? Are they getting bigger?

Three years ago, our average deal size was in $150,000-$200,000 per the statement of work. This year, it is $600,000 to $700,000 as the initiatives are becoming more mainstream and large .

I am expecting that the size will get bigger. We recently closed a $2 million plus deal, and there is one that is potentially $3 million. Trend moving towards bigger deals.

Nearly 85 per cent of your business comes from repeat customers. Do you expect this to change?

We don’t expect this to change and for existing clients to spend more. Data Analytics budgets are expanding. We also believe that we can run aggressively on new business. The 15 per cent is becoming bigger with every passing year.

How mature is the Indian market in adapting to data analytics solutions?

This year, we have kicked off an initiative where we created a small core team for India, and we recently won our first engagement here. We had conversations with ten organisations, and there is a healthy pipeline of opportunities. We see a spectrum in India that is not very different from what we see in other markets like the US and Europe.

Most organisations have set up some IT stack or applications. So, there is no dearth of data, but the question is how advanced you want to become in bringing data-oriented decision-making.

There is too much buzz around Data Analytics. Do you see more players coming into this space?

Data analytics is a very hot area, and while we are the first company to be in the listed space in data analytics, there are several others like Mu Sigma, Fractal Analytics and Tiger Analytics. There has been good growth in new companies coming in and finding their niches and growing. This space is also witnessing huge demand, even from traditional players. Large IT services organisations like Infosys and TCS are also trying to build their analytics practices.

LatentView Analytics continues to be focused on the US market. What’s the progress of your European expansion?

There is very good progress in Europe. We have hired a new business head for the Europe region, and he is already building his team. We are adding people to the front-end sales and business development. We are also adding delivery and capability. There is good potential in the European market despite slowdown fears. We have already closed 2-3 engagements, and there are half-a-dozen more in the pipeline. So, we are expecting good traction in the coming quarters.

What’s your target for the European market?

We want Europe to contribute 15-20 per cent of our revenues in a 3-4 year time frame.

Are you also looking at inorganic growth opportunities?

Absolutely. In fact, inorganic growth is our objective stated in IPO filings. We have earmarked ₹450 crore of fundraising for inorganic growth, and coupled with cash balances and reserves, we have a sizeable kitty to pursue inorganic opportunities. We have already evaluated over 30 candidates but have not made any acquisitions so far.

There are 2-3 interesting opportunities on the table, and one of them is at an advanced stage.

What are your criteria for acquisition? Is it to enter into a new geography or scale up?

There are some areas of focus that we have identified. From an industry standpoint, it is BFSI and retail. Any opportunities in these two sectors will be interesting for us. From a geographical perspective, it will be Europe. From this type of work, we are focusing on data engineering and supply chain analytics.

Source: The Hindu Businessline