Multi-billion dollar baby: Data analytics firm Mu Sigma set to raise another $500 mn?

What’s common between Flipkart and data analytics start-up Mu Sigma?It’s all about the valuation game and the analytics start-up is now looking for fresh funds.

Mu Sigma is reportedly looking to raise fresh funds in a bid to place itself in the multi-billion dollar valuation club.

Founded in 2004 by Dhiraj Rajaram, aformer Booz Allen Hamilton consultant,the Bangalore-based start-up could raise up to $500 million and may be valued at $6-7 billion (Rs 36,000-42,000 crore), the Economic Times quoted a person as saying.

The deal, when complete, will illustrate a rapid maturing of India’s entrepreneurial ecosystem where only last month Bangalore-based online retailer Flipkart received $1 billion from investors who valued the company at $7 billion.

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[caption id=“attachment_83801” align=“alignleft” width=“300”]  Image: Reuters[/caption]

According to the report, Mu Sigma, which is headquartered in the US, is talking to both financial and strategic investors for the latest round of fund-raising and has received interest from at least five potential investors.

It should be noted that Mu Sigma’s competitor Palantir – a US-based data analytics company which also started its operations in 2004 - raised over $100 million in December last year, and is said to be valued at $9 billion.

In 2008, Mu Sigma raised its first institutional investment round of $30 million from FTVentures (now FTV Capital). In April 2011, it raised an additional $25 million from Sequoia Capital . In December 2011, the company recieved $108 million round of financing from Sequoia and private equity investor General Atlantic.

In February 2013, Mu Sigma received an investment of $45 million from MasterCard, which took the company over the $1 billion milestone.

“Analytics is becoming far more than a siloed, singular tool and is now becoming more strategic, embedded in a variety of applications and infrastructure,” believes market research firm Gartner.

“Investment in analytics continues to be the highest priority tech investment for organisations, thanks to the visible business impact of analytics.”

In India alone, the data analytics services market is expected to grow to $1.15 billion by 2015, according to a study by financial services firm Avendus Capital.

With over 3000 decision scientists and experience across 10 industry verticals, Mu Sigma is set to be a significant player in the data analytics market, which is growing at an exponential rate.