On Friday, California-based building trades software developer ServiceTitan announced that it has received a $500 million funding round, bringing the company to an implied valuation of $8.3 billion. The capital round was led by private equity giant Tiger Global Management–whose earlier pre-IPO investments have included Facebook, JD.com, ByteDance, Spotify, LinkedIn and Stripe–along with public and late-stage private company investor Sequoia Capital Global Equities, with participation from H.I.G. Growth Partners.
Existing investors also re-upped for the Series D round, including Arena Holdings, Battery Ventures, Bessemer Venture Partners, Dragoneer Investment Group, Durable Capital Partners LP, ICONIQ Growth, Index Ventures, and funds and accounts advised by T. Rowe Price Associates, Inc.
This milestone represents the highest valuation and the largest investment for any private vertical software company in the world. According to ServiceTitan, new capital will be used to fuel its rapid growth and investment customer experience, product development, and expansion of its global workforce.
ServiceTitan’s business model is built around a software-as-a-service (SaaS) model for the building trades, an industry that it says has been “traditionally underserved by technology.” The suite includes CRM, intelligent dispatch, custom reporting, marketing automation, a mobile solution for field techs, and accounting, payments and financing integrations.
ServiceTitan also announced on Friday that it has surpassed $250 million in annual recurring revenue, having grown more than 50 percent over the past twelve months. The company serves more than 7,500 contracting businesses that collectively employ more than 100,000 technicians and perform more than $20 billion worth of annual transactions across various home and commercial service verticals, including (among others) plumbing, air conditioning, and electrical services.
“We depend on the men and women of the trades to maintain our life support systems: running water, heat, air conditioning, and power,” said ServiceTitan co-founder and CEO Ara Mahdessian. “Today, as both homeownership rates and time spent at home reach record highs, these essential service providers are facing rising demand from an increasingly tech-savvy homeowner. By providing contractors with the tools they need to deliver a great customer experience and grow their businesses with ease, ServiceTitan is enabling the hardworking men and women of the trades to reach the level of success they deserve.”
To help trade businesses navigate the pandemic, ServiceTitan partnered closely with its customers to develop a variety of features that enable technicians to provide homeowners with a truly contactless experience. In addition, ServiceTitan interviewed hundreds of customers to launch a playbook on how to adapt operations to succeed through COVID-19, along with an online community for contractors to share best practices with one another.
“ServiceTitan is powering a massive industry that has been underserved by technology for years,” said Chase Coleman, Partner and Founder, Tiger Global Management. “We admire the culture that Ara and (co-founder and President) Vahe (Kuzoyan) have developed, and we are incredibly excited to partner with them as they build the operating system for residential and commercial field services businesses.”
“ServiceTitan’s impressive growth demonstrates just how essential this technology is for the more than 5 million Americans who work in the trades,” said Jeff Wang, Managing Partner at Sequoia Capital Global Equities.
“We’re in the early innings of a fundamental shift. Software is transforming the trades industry to meet consumer demand for greater technology adoption and a mobile-first user experience,” said Tony Tamer, Co-Founder and Co-CEO of H.I.G. Capital. “ServiceTitan is building mission-critical software that not only addresses key challenges faced by residential and commercial contractors, but also drives new growth opportunities across the broader home services ecosystem.”
Mahdessian and co-founder and President Vahe Kuzoyan launched ServiceTitan in 2012 as a solution for their fathers, who both worked in the trades.
