24/7 Customer plans IPO, more hiring

Bangalore-based BPO player 24/7 Customer is looking at entering the capital market with an IPO in 2009, according to company officials. S Nagarajan, founder & chief people officer, 24/7 Customer told ET, “It could happen after a year but only if the markets are stable and there is no uncertainty.” He explained that apart from capital infusion for expansion, going public would bring more robustness in processes, predictability in growth and more credibility from clients. According to sources, 24/7 Customer had revenues of about $100 million in FY07 and is growing at a CAGR of 45-50%.

Investors in the company include Sequoia Capital and Ram Shriram apart from the founders P V Kannan and S Nagarajan. Sequoia and Ram Shriram invested about $22 million in late 2003 and are said to be keen on exiting. It is unclear whether the company will look for an India listing or US. Its peers like WNS, Genpact and EXL Services have gone public in the US market while Firstsource is listed in India. 24/7 Customer is also looking to grow its headcount in the India centres — Bangalore, Gurgoan and Chennai — as well as the hub in Phillipines. Mr Nagarajan said that the Manila centre currently has 1,000 people and this will double by end 2008.

He said that the fears of a US economic recession has not had any impact on the firm’s business or deal pipeline. “BPO basically involves core business areas that can’t be stopped. A mild recession might actually speed up deals because companies will be under pressure to reduce costs,” he said. Being diversified in terms of geographies, with only about 50% of business coming from the US, has also helped, he added.