Datamaran Secures $33M Growth Financing from Morgan Stanley Expansion Capital; More Than Doubles ARR Since Series B

Rhea-AI Summary

Datamaran, a leader in the ESG software market, has secured $33 million in Series-C financing from Morgan Stanley Expansion Capital. This investment validates Datamaran's global leadership and will be used to accelerate growth in the U.S. and Europe, as well as advance initiatives in generative AI. The company has more than doubled its subscription revenue in the past 18 months, driven by increasing demand for its ESG governance and risk solutions.

Datamaran's platform allows nearly 200 clients, including major corporations and organizations, to monitor over 400 external risk factors and comply with more than 4,000 ESG regulations and standards globally. The company's database of 9,000 companies enables customers to benchmark themselves, set targets, and drive efficiency and profitability. This financing round positions Datamaran to further penetrate the U.S. market and potentially add more Fortune 500 companies to its client roster.

Positive

• Secured $33 million in Series-C financing from Morgan Stanley Expansion Capital
• More than doubled subscription revenue in the past 18 months
• Platform serves nearly 200 clients, including major corporations like Dell, Cisco, and Pepsico
• Monitors over 400 external risk factors and helps comply with 4,000+ ESG regulations globally
• Database of 9,000 companies for benchmarking and target-setting
• Plans to accelerate growth in U.S. and Europe markets
• Advancing initiatives in generative AI

Negative

• None.

Financial Analyst

Datamaran's $33 million Series C funding from Morgan Stanley Expansion Capital is a significant milestone, indicating strong investor confidence in the ESG software market. The company's impressive growth, more than doubling its subscription revenue in 18 months, showcases the increasing demand for ESG governance and risk solutions. This capital injection will likely accelerate Datamaran's market penetration, particularly in the U.S. and Europe.

The company's client base of nearly 200, including major corporations like Dell and Cisco, demonstrates its strong market position. With over 4,000 ESG regulations globally, Datamaran's platform addresses a critical need in the corporate world. The investment in generative AI initiatives could further differentiate Datamaran in the competitive ESG software landscape, potentially leading to increased market share and revenue growth.

Tech Expert

Datamaran's focus on leveraging AI for ESG governance is a strategic move in an increasingly data-driven corporate landscape. Their platform's ability to monitor over 400 external risk factors showcases advanced data processing capabilities. The investment in generative AI could lead to more sophisticated predictive analytics and risk assessment tools, giving Datamaran a competitive edge.

The company's extensive database of 9,000 companies for benchmarking is a valuable asset, enabling clients to make data-driven decisions. As ESG regulations become more complex, Datamaran's tech-driven approach to compliance and risk management could become increasingly essential for large corporations, potentially driving further growth and market expansion.

Market Research Analyst

The ESG software market is experiencing rapid growth, driven by increasing regulatory pressures and stakeholder demands. Datamaran's success in securing this funding round and doubling its ARR indicates strong market validation for its offerings. The company's focus on serving C-Suite executives aligns well with the trend of ESG becoming a board-level concern.

With regulations like the EU's Corporate Sustainability Reporting Directive mandating C-suite ownership of ESG issues, Datamaran is well-positioned to capitalize on this shift. The company's ability to transform ESG compliance from a cost center into a value driver could be a key differentiator in a crowded market. However, as the ESG software space attracts more players, Datamaran will need to continue innovating to maintain its market leadership.

LONDON & NEW YORK--(BUSINESS WIRE)-- Datamaran announced today the completion of $33 million in Series-C financing from investment funds managed by Morgan Stanley Expansion Capital, validating its global leadership in the ESG software market.

The proceeds will be used to accelerate growth in the U.S and Europe and further advance initiatives in generative AI.

In the 18 months since its last funding round, Datamaran has more than doubled its subscription revenue, fueled by rapidly increasing demand for its ESG governance and risk solutions from C-Suite executives. The company’s software platform allows clients to monitor over 400 external risk factors and transform ESG compliance from a cost center into a value driver.

“As a 10-year-old company, we are the trailblazers in strategic ESG, and this investment will enable us to stay at the forefront of innovation in AI-powered software to serve our clients’ growing needs,’’ said Marjella Lecourt-Alma, CEO and Co-founder of Datamaran. “With the number of ESG reporting requirements increasing exponentially, there is a clear incentive for companies to double down on ESG governance and know their material risks and opportunities.’’

Datamaran’s platform allows its nearly 200 clients, including Dell, Cisco, AB InBev, Deloitte, and Pepsico, as well as organizations such as the European Financial Advisory Reporting Group (EFRAG), to prepare for and comply with the more than 4,000 ESG regulations and standards globally. In addition, its database of 9,000 companies lets customers easily benchmark themselves, set targets, and achieve the best outcomes to drive efficiency and profitability.

Commenting on the financing, Lincoln Isetta, Managing Director of Morgan Stanley Expansion Capital, said: “Datamaran has exhibited impressive growth and capital efficiency since we first met them over two years ago. They are a market leader in providing technology that enables companies to embed ESG into their business practices, which is becoming more important as customers, stakeholders and regulators demand ever greater accountability from global enterprises. We are excited to partner with Marjella and her team to support Datamaran’s next stage of growth, penetrating further into the U.S. market and seeking to add more Fortune 500 companies to an already impressive client roster.”

International regulations such as the European Union’s Corporate Sustainability Reporting Directive are increasingly requiring proof of C-suite ownership and board oversight of ESG issues. Datamaran's clients benefit immediately from the adoption of its platform as a governance tool that enables accountability, while ensuring agility as the ESG landscape undergoes rapid change.

Datamaran’s previous financing round was led by Fortive (NYSE:FTV) with participation from American Electric Power (NASDAQ:AEP).

About Datamaran

Datamaran is the leading software analytics platform that identifies and monitors external risks, including ESG. In addition to being trusted by blue-chip companies and top-tier partners, it has been recognized as best practice by the European regulator EFRAG for bringing a data-driven business process for materiality analysis and risk monitoring in-house - at any time. Datamaran's patented technology offers real-time analytics on strategic, regulatory, and reputational risks, specific to your business and value chain. Learn more at Datamaran.com

About Morgan Stanley Expansion Capital

Morgan Stanley Expansion Capital is the growth-focused private investment platform within Morgan Stanley Investment Management. Morgan Stanley Expansion Capital targets late-stage growth equity and credit investments within consumer, technology, healthcare, and other high-growth sectors. For over three decades, Morgan Stanley Expansion Capital has successfully pursued growth investment opportunities and has completed investments in over 200 companies, leveraging the global brand and network of Morgan Stanley.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240917234304/en/

Katherine Snyder, katherine@stuloeser.com | Grace Smoker, grace@stuloeser.com

Source: Morgan Stanley Expansion Capital

FAQ

How much funding did Datamaran secure in its Series-C round from Morgan Stanley (MS)?

Datamaran secured $33 million in Series-C financing from investment funds managed by Morgan Stanley Expansion Capital.

What is Datamaran's plan for the $33 million funding received from Morgan Stanley (MS)?

Datamaran plans to use the funding to accelerate growth in the U.S. and Europe markets, and further advance initiatives in generative AI.

How has Datamaran's subscription revenue changed since its last funding round?

Datamaran has more than doubled its subscription revenue in the 18 months since its last funding round.

Which major companies are among Datamaran's clients?

Datamaran's clients include major corporations such as Dell, Cisco, AB InBev, Deloitte, and Pepsico.