OutSystems, a leading development service for low-code apps, has confirmed raising $150 million in fresh funding in a round led by Tiger Global and Abdiel Capital. The company earlier raised $360 million in 2018 and is based in the USA. The company was established in 2001 and it is older than several other tech players in the space although it is still privately owned. It may have gained more traction from the rapid transformation of companies of all sizes in the digital space.
OutSystems gave away 1.6% of the company in the deal while selling $150 million of shares at a valuation of $9.5 billion. Investors clearly have confidence in the company’s future prospects, going by its valuation. The company may be on the pathway toward an IPO in the future as per reports although it has not confirmed any such plans till now. The round is a lot similar to capital raising in the pre-IPO days and OutSystems has already mentioned how it has a more efficient model in terms of new funding, indicating cash consumption at a moderate level.
The CEO at OutSystems, Paulo Rosado, stated that prior to this funding announcement, the company was already deploying investments to achieve future growth across GTM (go-to-market) and research and development abilities. The CE has stated that the focus of the company will be the development of scale in a more efficient manner. The company focuses on low-code development activities, differentiating it from a bunch of other start-ups in the tech space along with other private entities emphasizing no-code ventures. Low-code solutions fuse a little coding with interfaces for visual programming.
Rosado has previously stated that low-code offers better suitability for building several types of apps along with offering more adaptability and flexibility along with taking care of corporate or entity workflows better. He stated that low code comes with a can-do approach as opposed to no-code which is a narrower suite of tools and approaches. He added that low-code means executing tasks with the help of code and this will be fused into the part which is the no-code one. Hence, this equates to no-code abilities with easy adaptability with regard to using code.
No-code enthusiasts may state that the development part which requires code may be redundant eventually with the growing abilities of their specialized tools for bypassing code. However, the methodical framework adopted by OutSystems is already working in the market, going by its recent funding round. The CEO has confirmed that the pricing system for the company is based upon the utilization of the platform as opposed to conventional SaaS-based pricing mechanisms.
He also added that their competition is in the non-consumption space. The company once raised $55 million in 2016 in a previous funding round. It has clearly come a long way since then. Over the last few quarters, the low-code segment has seen high demand as reported by various start-ups. OutSystems is one of the biggies in the space with fresh momentum and capital to enable rapid expansion.
