Capillary Tech buys assets of customer loyalty services firm Kognitiv

Bengaluru-based Capillary Technologies, which provides customer engagement and loyalty software services, said that it acquired certain assets of Kognitiv, a Canadian company that helps clients manage their customer loyalty programmes.

The terms of the deal were undisclosed.

Kognitiv had last month filed for protection from creditors under the bankruptcy law in the US, after having accumulated liabilities of more than $10 million.

For Warburg Pincus-backed Capillary, which is planning to go public later this year, this is its third acquisition in North America.

The company derives more than 60% of its revenue from the US market. The deal will give Capillary access to more than 30 enterprise clients including leading hotel companies in Australia and New Zealand, the UK, Middle East and the US, the company said in a news release.

According to sources, Capillary is acquiring a part of Kognitiv’s assets without taking its debt obligations.

Aneesh Reddy, cofounder and CEO of Capillary Technologies, said: “Kognitiv's expertise in omnichannel loyalty solutions and their presence in North America complements our global expansion strategy.”

For the year ended March 2025, the company reported a 24% year-on-year increase in operating revenue to Rs 598 crore. Capillary turned profitable during fiscal 2025, posting a net profit of Rs 13 crore, against a net loss of Rs 59 crore in FY24, as per its annual report.

In November last year, ET reported that Capillary revived its plans for a public issue, through which it could raise as much as Rs 2,000 crore. The company had first filed its draft prospectus with the Securities and Exchange Board of India in December 2021 but then deferred the plan.

In June 2023, Capillary raised $45 million through a mix of equity and debt from investors including Avataar Ventures and its limited partners, in addition to Pantheon, 57Stars and Unigestion. The round was extended in early 2024 to include secondary transactions, during which Warburg Pincus and American Express partially exited. The round finally closed at $140 million.

Capillary Technologies was founded in 2008 by IIT-Kharagpur alumni Aneesh Reddy, Ajay Modani and Krishna Mehra. Modani and Mehra have since moved on from the business, leaving Reddy at the helm. In August 2023, the company elevated senior executives Sridhar Bollam and Ananth Choubey to the cofounder status.

The company powers backend loyalty programmes for major corporations and conglomerates such as the Tata Group, Aditya Birla Group, Domino’s, Shell, and IndiGo.