Cyara raises almost $500 million in a “great testament” to Aussie tech

Cyara co-founder and chief executive Alok Kulkarni. Source: supplied.

Melbourne-founded Software-as-a-Service (Saas) company Cyara has closed a mammoth US$350 million ($495.2 million) funding round, equaling the largest raise in Aussie startup history and allowing it to ramp up global expansion plans.

The funding comes from US investment giant K1. And according to Cyara co-founder and chief executive Alok Kulkarni, it is part of a broader narrative putting local tech companies on the global map.

Founded back in 2006 by Kulkarni and co-founders Luan Tran and Bonny Malik, Cyara is an automated customer experience assurance platform that tests and assesses customer interactions, whether that’s through their website, live chat, emails or call centres.

Large companies typically handle millions of interactions every day, co-founder and chief executive Kulkarni tells SmartCompany.

If they don’t get it right, there can be serious consequences, with up to 32% of people never returning to the business.

The startup counts the likes of ebay, Oracle and Vodafone among its customers, and saw revenues of more than US$35 million ($50 million) in the 2021 financial year. The majority of that came from the US.

During the COVID-19 pandemic, revenues have been tracking up by about 25%, year-on-year.

“The pandemic really demonstrated the need for every business to have a digital engagement and transaction capability,” Kulkarni says.

That means their customer engagement processes have had to adapt, too.

“Customer experience is the lifeblood of any business,” he says.

This year, Kulkarni expects to see revenue growth ramp up to 30% or 40%.

The co-founders are looking to onboard 100 additional team members, including in the Australia-based product and engineering teams.

There are also opportunities to expand the startup’s footprint in the US and to expand into the Asian and European markets.

A testament to Australian tech

But for Kulkarni, the sheer size of the round and the backing of such a big-name VC is a testament to the strength of the team, the vision behind the business and the trust that early employees and customers put in the business.

“Also it’s a great testament to Australia and the talent we have,” the founder says.

The raise is indeed the latest in a string of Aussie mega-deals over the past few months.

In November last year, K1 also led a US$350 million investment into Brisbane based SaaS company SimPRO. In December, Rokt bagged $458 million in Series E funding.

According to data from Cut Through Venture, startup funding in Australia and New Zealand hit more than $10 billion in 2021. That’s more than double the total invested in 2020.

The 10 largest deals of the year were all more than $100 million, including Canva’s $273 million raise; Go1’s unicorn-making $272 million; and Octopus Deploy’s $223 million round, which came after 10 years of bootstrapping.

Much of this funding also came from global VC firms, marking something of a sea-change in the local ecosystem.

In order to close an earlier round in 2014, Cyara’s founders had to move their HQ to the US, Kulkarni recalls.

That was just eight years ago, but the local VC scene was relatively nascent and US investors “would not even consider you” unless you were domiciled Stateside, he says.

Obviously that’s no longer the case.

“It’s a really exciting time to be in the market,” he adds.

“Companies in Australia can be global companies with the whole world on your doorstep.”

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