Fintech unicorn Cred is seeking to raise $100–200 million in a fresh funding round, which would put the Kunal Shah-led company's post-money valuation at $4 billion, a significant drop from its $6.4 billion valuation set in 2022.
In order to attract further funds, the Bengaluru-based business is in discussions with its current investors, who include Tiger Global, Ribbit Capital, Peak XV Partners, Singapore sovereign fund GIC, and QED Innovation Labs.
It is significant to remember that in 2022, CRED raised $140 million in its Series F fundraising round, which was headed by GIC. The company was valued at $6.4 billion in the round.
The new funding will guarantee that CRED has the funds to carry out the next stage of its expansion while generating more revenue and lowering cash burn. The financial behemoth is aiming for profitability and is probably going to do an IPO within the next two years.
In fiscal year 2023-24 (FY24), CRED's operational revenue increased by a staggering 71% to Rs. 2,397 Crore from Rs. 1,400 Crore in the previous fiscal year. CRED's net loss increased 22% to Rs. 1,644 Crore during the year from Rs. 1,347 Crore in FY23, despite rise in the top line.
CRED, Shah's idea, began as a platform for credit card bill payments in 2017. But in recent years, as it expands its fintech goals, it has adopted a mega app strategy.
These days, CRED offers services including UPI payments, utility billing, car management, and travel experiences. In order to compete with companies like Zerodha, Groww, and PhonePe, it also purchased the investech platform Kuvera last year.
When the company introduced CRED Cash+, a loan against mutual fund product for its clients, in February, it put itself up against firms like Bajaj Finserv, BharatPe, Jio Financial Services, and smallcase.
