Serial entrepreneur Kunal Shah-founded Cred is continuing its fundraising spree and has closed a round of roughly $251 million as a part of its Series E round, co-led by Tiger Global Management and Falcon Edge Capital, two individuals aware of the discussion told Mint.
The company closed the round over the weekend at a valuation of $4.01 billion, both the individuals confirmed on condition of anonymity. With this, Bengaluru-based Cred has almost doubled its valuation since April when it raised $215 million at a $2.2 billion valuation to enter into India’s coveted unicorn club.
New investors joining Cred’s cap table as a part of the Series E fundraise include London-based Marshall Wace and Steadfast Venture Capital, with existing investors including DST Global, Insight Partners, Coatue, Sofina participating as a part of the round, said the individuals cited above.
When we reached out for comment, Cred confirmed the close of the fresh fund raise.
The fresh round of funding is expected to be utilised by the company to grow its existing range of products as it looks to expand financial service offerings for customers.
Investor interest, meanwhile, continues in the company that has been approached by several investors for potential investment, which could value the startup between $5-6 billion, a third person said on condition of anonymity.
Cred, however, says it has no plans to raise another round of funding. “Cred is fortunate to have consistent inbound interest owing to the value created for investors and team. However, the information that Cred is looking to raise another round is wrong,” said the company in a written response to Mint’s queries.
Cred was launched in 2018 to help users pay credit card bills easily and earn rewards. It has since expanded to lending through Cred ‘Cash’, and also enabled online commerce and brand discovery through its ‘Store’ and ‘Commerce’ platforms.
Currently, Cred ‘Cash’ provides members an instant line of credit, with interest rates ranging from 12% to 15%, and partners with non-banking finance companies (NBFCs) to fund these loans. The platform counts IDFC First Bank among others as its NBFC partners.
The company is also in talks to partner with Japanese financial services provider Credit Siason for its Cred ‘Cash’ offering ,the third individual said. Further, sources added that the company has facilitated a loan book of Rs 3000 crore for its partners. Cred declined to comment on the partnership and the loan book.
Earlier in August, Cred also launched peer-to-peer (P2P) lending for members on its platform, through the newly launched Cred ‘Mint’ feature. The feature allows Cred members to lend to other members on the platform at 9% interest, as a way to maximise their financial growth.
Its other lines of business includes its payment product, Cred Max, which allows credit card holders to pay for rent and school fees used-cases for a small transaction fee.
In an earlier interaction with Mint in August, Cred founder Kunal Shah said that Cred 'Commerce’ had 2,000 brands, and that its ‘Max’ product was used by 600,000 customers. The focus was on establishing the right fit for these products, Shah added.
Indian startups are witnessing heightened interest from global and domestic investors this year. In the first three quarters of 2021, ending 30 September, equity investments in Indian startups have crossed $24 billion, the highest clocked by the ecosystem ever.
Further, fintech continues to be the hottest bet for investors this year, attracting the highest investments. In the first three quarters of 2021, investments in Indian fintech grew by almost three-fold compared to the same period last year, as firms in the sector raised $4.6 billion, according to estimates by consulting major, PwC.