A growth glitch for Freshworks

Stalling global economy has impacted the ambitious Nasdaq-listed start-ups' share price

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In September 2021, Freshworks became the third Chennai-based tech company to get listed on Nasdaq after Cognizant and Sify. It also became the first Indian software as a service (SaaS) company to do so. What initially caught everyone's attention was the code name of the initial public offering, Project SuperStar.

This was named after idol Rajinikanth, whom the founder Girish Mathrubootham called maanaseega guru, which roughly translates to mean mentor or role model that lives in your mind, in his IPO filing.

"Superstar is a man who is loved and worshipped by millions of fans globally. He is immensely successful yet humble and down to earth. Thank you, Thalaivaa!" he wrote. The story after the IPO, however, was not as exciting as a Rajinikanth movie.

The Nasdaq listing offered 28.5 million shares at $36 a share. On listing day, Freshwork's stock closed at $47.55. Since then the stock price has fallen by as much as 70 per cent to $14.32. On the operational front too, the company was facing a crisis - December last year, it had to lay off around 90 people, 2 per cent of its total workforce "to fuel business growth". Out of this, 60 of the affected employees were based in India. The company explained that it had downsized some roles in product, marketing and sales.

According to industry experts, though the company had reported a strong quarter in Q3, it was not immune to this slower economy. While new businesses reportedly picked up, expansion slowed down.