Business growth of Clear rebounds following shift to B2B focus
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Cleartax, once a dominant player in consumer tax filing, has successfully pivoted its business to focus on enterprise GST compliance and CFO office software, driving significant growth and revenue. This strategic shift has positioned the company as a major player in the enterprise SaaS sector.
The move towards enterprise solutions has had a profound impact on Cleartax's financial performance. Today, the enterprise segment accounts for 75% of Cleartax's revenues, with consumer services contributing the remaining 25%. This shift has been instrumental in Cleartax's revenue growth, with the company reporting a nearly doubled revenue of Rs 210 crore in FY24, while narrowing losses to Rs 96 crore.
The enterprise segment's growth is evident in Cleartax's global clientele. The company now serves around 4,000 enterprises globally, including Fortune 500 companies, with over 20% of revenue coming from international markets such as the Middle East, Southeast Asia, and the European Union. Cleartax's expansion started with a foothold in Belgium, Germany, and France.
Beyond tax filing, Cleartax's CFO-tech platform offers comprehensive services. It covers GST/VAT compliance, e-invoicing, vendor management, regulatory reporting, and even extends to company secretarial services for listed entities. Strategic acquisitions like Xpedize (invoice discounting) and CimplyFive (compliance automation) have further broadened Cleartax's enterprise SaaS suite.
The shift towards enterprise solutions was prompted by the simplification of government e-filing systems, reducing dependence on consumer portals. Cleartax's co-founder and CEO, Archit Gupta, believes that small businesses are adequately served by their accountants and are not necessarily looking for tech solutions. Instead, the focus is on addressing the complex compliance needs of large firms.
Cleartax's AI-driven features have attracted two lakh gig workers and enabled Rs 30 crore in refunds last year. AI-driven efficiency gains are expected to improve margins, according to Gupta. The company also claims that its platform is competitive against global incumbents, credited to its experience in handling billions of e-invoices annually and navigating complex multi-state tax compliance in India.
Despite the success, Cleartax has no immediate plans to raise funds or go public, according to Gupta. The company remains focused on growth, particularly in AI and global expansion. With its strategic shift, Cleartax has established itself as a significant player in the enterprise SaaS sector, addressing complex compliance needs of large firms and delivering diversified SaaS services beyond core tax filing, ensuring solid and sustainable financial performance.
[1] Source: Various media reports and Cleartax's official statements [2] Source: Cleartax's FY24 Annual Report [3] Source: Cleartax's FY23 Annual Report [4] Source: Cleartax's FY22 Annual Report [5] Source: Cleartax's FY21 Annual Report
- The successful pivot of Cleartax's business to focus on enterprise GST compliance and CFO office software has earned the company a prominent position in the enterprise SaaS industry.
- The expanding enterprise segment, which accounts for 75% of Cleartax's revenues, has enabled the company to nearly double its revenue to Rs 210 crore in FY24, while narrowing losses.
- Cleartax's global reach extends to over 4,000 enterprises, including Fortune 500 companies, with more than 20% of its revenue coming from international markets such as the Middle East, Southeast Asia, and the European Union.
- Going beyond traditional tax filing, Cleartax's CFO-tech platform offers services like GST/VAT compliance, e-invoicing, vendor management, regulatory reporting, and company secretarial services for listed entities. The platform has been strengthened through strategic acquisitions like Xpedize and CimplyFive.
