INDIA’S FINTECH STARTUP CRED BY KUNAL SHAH ENTERS UNICORN CLUB - MENA startups, innovation, and tech news

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INDIA’S FINTECH STARTUP CRED BY KUNAL SHAH ENTERS UNICORN CLUB
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INDIA’S FINTECH STARTUP CRED BY KUNAL SHAH ENTERS UNICORN CLUB

The Bengaluru-based fintech startup CRED enters UNICORN Club.By choosing the conscious path of focusing on growth over monetisation led Cred to enter Unicorn club with a $2.2 billion valuation. Fintech start-up Cred is a credit card management platform which on April 6 2020 leapt to unicorn status.The aim of the company is to deploy the fresh capital towards scaling the products that Cred launched last year.

The startup in early January 2021 announced an $80 million fundraising round, which had valued it at $806 million. Announcing the fundraise, Shah mentioned that the company will also offer its employees an ESOP buyback opportunity, with a cumulative value of $5 million.Today Cred controls 22% of all credit card payments in the country and their focus is to grow this market share said Kunal Shah, founder of Cred.

Kunal Shah – Founder of Cred

The new round was co-led by new investor Falcon Edge and Coatue Management LLP (new investor), founder and CEO Kunal Shah said in a company newsletter.Existing investors DST Global, RTP Global, Tiger Global, Greenoaks Capital, Dragoneer Investment Group, and Sofina also participated in this round.

According to Credit Suisse Group AG report, there are about 100 unicorns in India with a combined market value of $240 billion, in sectors from e-commerce and fintech to education, logistics and fooddelivery. Cred has managed to enter one among the 100 unicorns. The Bengaluru-based fintech giant has already raised $80 million in December from the partners of DST Global, with participation from Sequoia Capital, Ribbit Capital and Tiger Global.

Shah quoted about the current growth of Cred

“For monetization products such as lending and commerce, we have seen good traction. And the cohort Cred has chosen is slightly easier to monetize. In the long run, we are focused on the revenue scale and profit collection that we can show,”

Cred was launched in 2018 by Kunal Shah, also the co-founder of Freecharge. Cred also helps users pay credit card bills whilst earning rewards. The company also has a Cred Pay product for easy checkouts on its in-app e-commerce platform which has over 1,800 brands – the company claims.

Cred has witnessed losses totalling INR 360.31 crore in FY20 compared to INR 60.87 crore in FY19, along with an interest of INR 17.56 crore coming from interest on deposits. On talking about the success Shah added, while valuation is a milestone that many celebrate, they view it as a responsibility and an opportunity to create member value. As the credit card category continues to grow rapidly in India, their opportunity is to imagine new use-cases, empower Cred members to use credit responsibly and reward them for good financial behaviour.

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