MUMBAI: ManageMySpa, a software solution startup founded by Silicon Valley returned serial entrepreneur Sudheer Koneru, has raised $6 million (about Rs 38.4 crore) in series A funding from Accel Partners. The Seattle and Hyderabad-based company, founded in 2010 as Soham Online Solutions, makes web-based software for service industries including spas and salons.
The deal is among the largest series A cheques by Accel, which usually invests $1-2 million at that stage.
"We believe that ManageMySpa is at a pivotal point in its growth trajectory and has all the competencies to become the leader in its space. We're excited about the momentum the company has experienced so far and the growth of the wellness industry globally," said Accel Partners' Shekhar Kirani, who has also led the venture capital firm's investment in other software as a service (SaaS) companies such as FreshDesk and Hotelogix.
ManageMySpa helps salons with processes including billing, appointment book, inventory, employee management, marketing, customer loyalty and reporting. It competes with global players such as Mindbodyonline, Spabooker and Millennium.
The company's solution is now used by over 2,000 spas and salons in India and over 5,000 overseas. In India it has clients such as Kaya Skin, Enrich Salons, O2 Spas and Blush Clinics. It has now set sights on the United States market as well, with capital expected to be invested in sales and marketing besides expanding its mobile product offering.
"In the last 12 months we have started targeting the US market, which will account for over 50% our sales soon. Indian brands, which were our first customers, have turned out be a great reference point," said Koneru, an IIT Madras graduate who worked at Microsoft for eight years before launching a startup in 2000.
Koneru sold his previous venture Intelliprep to Microsoft co-founder Paul Allen's Click2learn in 2001 that later merged with SumTotal Systems in 2004. After stepping down from SumTotal, which had revenues of $100 million, he invested in Hyderabad healthcare chain Latitudes Pro which was acquired by Apollo Healthcare in 2013.
Running the health and spa chain gave Koneru the idea to start cloud-based software solution for spas and salons.
Experts see the trend of SaaS companies targeting specific retail sectors such as hotels, healthcare and neighbourhood stores increasing. "These companies are vertically integrated and focused, with products being competitively priced as customers are very demanding. So if a company can crack the India market and make it valuable for customers here, they can rule the world," said Sharad Sharma, angel investor and co-founder of software products think tank iSpirit.