ServiceTitan, a SoCal-based firm which offers a SaaS product for tradespeople, raises $500M Series F led by Tiger Global and Sequoia at a $8.3B valuation (Alex Konrad/Forbes)

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It’s no new live audio app, crypto company or remote-work tool. But as Americans have stayed home in recent months, a software startup called ServiceTitan has helped the trade professionals who maintain those homes stay safely in business behind the scenes. And with a new valuation of $8.3 billion following a recent funding round, ServiceTitan looks poised to garner some buzz of its own.

ServiceTitan has raised $500 million in a round led by Tiger Global and Sequoia Capital Global Equities, the company tells Forbes, with existing investors Battery Ventures, Bessemer Venture Partners, Dragoneer Investment Group, Durable Capital, Iconiq, Index Ventures and T. Rowe Price all participating. The Series F funding round’s $8.3 billion valuation quintuples Glendale, California-based ServiceTitan’s previous valuation of $1.65 billion set in November 2018.

“Home and commercial services doesn’t rank super high on the glamour scale, but it does on the criticality scale,” says CEO Ara Mahdessian, who cofounded the business with Vahe Kuzoyan in 2012. “I think our customers are the real heroes of this story, especially during Covid-19. Think how much more important health and safety in the home has become.”

During the pandemic, ServiceTitan observed some of its customers enjoy an immediate boom in their business, while others struggled. Playing to the collaborative nature of contractors, Mahdessian says, the company was able to collect best practices and put together a playbook for safe and contactless home services, while donating 100,000 masks. The company also quietly added money to its war chest during the uncertain period, Los Angeles Business Journal unearthed in a filing last May, in a smaller Series E funding precursor to this new raise.

Overall, ServiceTitan kept growing. The company says it’s passed $250 million in annual recurring revenue, up 50% year-over-year, with 7,500 customers, triple its number when it reached billion-dollar-startup status in late 2018. The Glendale, California-based company has also made several acquisitions, most recently of ServicePro, an Ohio pest control business that brought it into that area of home maintenance and bumped its head count to more than 1,600. Last September, ServiceTitan reached No. 11 on the Cloud 100, Forbes’ definitive ranking of the world’s best private cloud computing companies.

Mahdessian and Kuzoyan tell a founding story fit for a docudrama: Both Armenian immigrants to southern California, they bonded on a ski trip for Armenian college students, the story goes, by talking about their fathers, who worked in trades. The duo soon teamed up on small consulting projects, before launching ServiceTitan in 2013 and spreading it through the Los Angeles area’s Armenian community.

Against that plucky narrative, however, Mahdassian says there’s a misconception that tradespeople are blue-collar, hardscrabble individuals as a group. “I think the size and criticality of this industry is often lost, even on us,” he says. The average ServiceTitan customer makes between $3 million and $5 million in annual revenue, the company claims, with more than 10 service trucks. And of the more than five million workers in the U.S. who qualify as tradespeople, thousands are millionaires, Mahdassian claims, while tens of thousands make annual salaries of more than $100,000.

With the funding, Mahdessian and Kuzoyan say they plan to hire more staff to develop their product lines across trade types and the features by which they serve them. The company’s invested recently in smart dispatching and route optimization tools for customers with multiple technicians, as well as parts procurement and marketing tools such as automation, email and reputation management. ServiceTitan doesn’t offer its own two-sided marketplace to customers today; the closest it has is a partnership with Google, by which the search engine filters up local service businesses, their ratings and how to book.

The company already claims to have now raised the largest investment for a private vertical software business anywhere. “We want to build the operating system for the trades, that takes care of all tradespeople and takes care of all their needs,” Mahdessian says.

Another area ServiceTitan may look to invest more coming out of the pandemic: Its commercial business, which was just getting going when the pandemic stopped it in its tracks. That side of the business saw a “pretty dramatic decline,” ServiceTitan’s CEO says, but he adds that it represented less than 5% of sales. And, with companies renovating while their employees are out of office, it may be an area poised to bounce back more than people might think, he adds.

In the meantime, both ServiceTitan’s founders have used the shelter-in-place period to see their own product in action. They, like everyone else, have had their share of air-conditioning crises or improvements to make. “I like to get secret product feedback, because a lot of the local providers are ServiceTitan customers,” says Kuzoyan, ServiceTitan’s president. “So I love getting somebody in and being like, ‘what app are you using? Do you like it?’ And I get that raw, ‘I like this, I don’t like this.’ It’s good.”

This content was originally published HERE

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