CRED, the fintech start-up, founded by serial entrepreneur Kunal Shah, announced on Tuesday that it had raised $215 million in a Series D funding round, valued at $2.2 billion post-money, making it India’s newest unicorn.
The latest round of investment, led by new investor Falcon Edge Capital and existing investor Coatue Management LLP, comes after the company raised $81 million in its Series C round in January, valuing it at $806 million. Current investors DST Global, RTP Global, Tiger Global, Greenoaks Capital, Dragoneer Investment Group, and Sofina entered this round along with new investor Insight Partners.
With this round, the company has raised nearly $300 million in funding in just 2021. Kunal Shah, the founder of CRED, confirmed the news, saying that existing investors had subscribed to nearly 70 percent of the current round. He also confirmed that the funds would be used to expand the company’s current product range, which was introduced last year.
In an internal memo to employees on Tuesday, Shah announced the fundraise, and also announced that the company would begin a $5 million ESOP buyback for employees. ” CRED Founder Kunal Shah wrote in an internal report.
“In the same way, that the funding allows CRED to invest in its future, Shah hopes the buyback will enable some of you to do so as well,” he wrote in an internal memo.
CRED, which is two and a half years old, was founded on the idea of allowing consumers to pay their credit card bills quickly, while also receiving extra rewards. Since then, it has extended its offerings to include lending via its CRED Cash credit line, as well as online commerce and brand discovery, via its Discover and WIN app. On its website, it has also introduced new used cases, such as rent payments through ‘CRED RentPay.’
New features, such as CRED Pay, have been added to the company’s in-app commerce platform, to assist with quick checkouts. CRED’s current lines of operation, according to Shah, have been steadily increasing and provide substantial revenue opportunities for the company. The Bengaluru-based start-up’s cumulative losses rose to 360.31 crore in the fiscal year ended March 2020, up from 60.87 crore the previous year.
While many people look forward to valuation, we see it as a duty and an opportunity to bring value to our members. Over the last 2.5 years, we’ve expanded quickly, now accounting for 35 percent of premium credit card holders and handling 22 percent of all credit card payments in India on a monthly basis,” stated Shah.
“Our opportunity is to envision new use-cases, inspire CRED members to use credit wisely, and reward them for good financial behaviour, as the credit card segment continues to expand rapidly in India,” CRED Founder Shah wrote in an internal memo.
