6 highlights
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If this goes through, this will make Kunal Shah-led CRED probably the only company in the ecosystem to have raised three back-to-back funding rounds with valuation more than quadrupling in less than a year. And this would make the credit card bill payments company the second-most valuable fintech in India after digital payments firm Paytm.
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“More than competing in the market, founders are competing for the funding. Everybody is competing for the same funds,” says the co-founder and CEO of a fintech startup, asking not to be named.
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When you are running on a treadmill, you need to always keep increasing the pace and the growth hunting will work till a certain stage, and after that you will get asked hard questions like how the business model makes sense? What does profitability look like? Is it long-term sustainable? Because capital can take you to a certain stage, people will have to wait and check whether the performance is meeting or not.
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Of the company’s total user base of 5.9 million credit card holders then, about 60% or roughly 3.5 million were monthly active users. About 5% of these active users took loans through the platform.
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BharatPe—which started with a merchant-first mindset—has already moved to create a consumer payments app called PostPe (taking on the likes of PhonePe, Google Pay and Paytm), as well as a beta P2P investments and lending app called 12% Club (a name reminiscent of the “CRED Club”)
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“Three years ago, people were questioning the very thesis of CRED’s existence. But now everybody is migrating to that customer segment. So, this segment will get competitive, and it will get dirty,” says the fintech investor quoted earlier.