Investment in Conversational AI Startup Gupshup Marked Down by Fidelity Investments

Investment in Gupshup, a US-based conversational AI startup, has seen a significant decrease, as Fidelity Investments recently adjusted the value of its holdings. According to recent monthly disclosures from Fidelity, the valuation for its stake in Gupshup has been reduced to $3.35 million, a significant drop from the initial investment of $16.2 million made in 2021. This investment was part of a funding round that valued Gupshup at $1.4 billion.

Current Valuation of Gupshup

With the updated fair value, Gupshup’s estimated valuation now ranges between $280 and $300 million, marking a decline of nearly 80% from its previous valuation exceeding one billion dollars. This change reflects the ongoing volatility in the tech industry.

History of Fidelity’s Investment Adjustments

This isn’t the first instance of Fidelity adjusting its valuation for Gupshup. Over the past couple of years, the asset management firm has consistently revised the figures for the startup. Earlier disclosures suggested a valuation of approximately $876 million for Gupshup in 2023, followed by around $500 million in 2024. A markdown in December 2024 noted a valuation drop to nearly $486 million.

Background on Gupshup

Fidelity made its original investment in Gupshup through its Blue Chip Growth Fund in mid-2021, coinciding with a peak period for funding when many SaaS and internet companies were receiving high valuations. Established in 2004 by Beerud Sheth, Gupshup provides conversational messaging and AI-driven engagement solutions for businesses across various platforms, including SMS, WhatsApp, and other chat services. The company supports thousands of enterprises globally and has enhanced its capabilities with several acquisitions in recent years.

Financial Performance of Gupshup

The business operations of Gupshup in India alone generated revenue amounting to Rs 1,943 crore in FY25, while profits during the same period were reported at Rs 26 crore. However, to gain a complete understanding of Gupshup’s financial health, it is essential to also consider its global operations.

Recent Financial Developments

In the past year, Gupshup successfully raised $60 million from Globespan Capital Partners and EvolutionX Debt Capital. The company has also set a projected timeline of 18 to 24 months to pursue an IPO, with intentions of reversing its operations back to India.