Meta has invested $900 million i.e. about Rs 8,550 crore in CRED. Under the deal, CRED founder Kunal Shah will become the new head of WhatsApp.
Who is Kunal Shah: Meta Platforms has invested $900 million (about Rs 8,550 crore) as part of the ‘Series H’ funding round of startup CRED. With this deal, CRED founder Kunal Shah has been appointed as the new head of WhatsApp. He will replace Will Cathcart, who led the messaging platform for the last 7 years.
Meta bought 20% stake in CRED
Under the agreement, Meta will purchase a minority stake of approximately 20 percent in CRED. After this investment, the post-money valuation of the company is estimated to be around Rs 43,239 crore i.e. approximately $4.5 billion. This funding is a mix of purchase of primary and secondary shares, through which the company will both get fresh capital and also provide a partial exit opportunity to some existing investors.
Kunal Shah will take charge of WhatsApp
Under this deal, Kunal Shah will step down as Chief Executive Officer (CEO) of CRED and become part of Meta’s global leadership team. He will take over the responsibility as the new head of WhatsApp. At the same time, current WhatsApp head Will Cathcart will now work in a new position related to Artificial Intelligence (AI) in the company. Meta says Kunal Shah will play a key role in taking WhatsApp to the next phase of growth. Their main focus will be on increasing revenue through advertising and subscription based products as well as incorporating AI agents into the platform.
Miten Sampat becomes interim CEO of CRED
Following Kunal Shah’s departure from the day-to-day operations of the company, Mitten Sampath has been appointed as the interim CEO of CRED with immediate effect. Miten Sampat has been handling the responsibility of strategy and finance related work in the company since the year 2020. CRED said its board and senior leadership team are working to create a sustainable management structure for the company.
CRED is preparing for IPO
According to the company, it is further strengthening its organizational structure keeping in mind the possibility of stock market listing in future. In this direction, work is being done on new leadership and management system.
CRED story
CRED was started in the year 2018. In the initial phase, the company’s focus was on giving rewards to those customers who paid their credit card bills on time. Over time the company expanded its business and has now become a comprehensive financial services platform. Its portfolio includes many products related to payments, lending, insurance, wealth management and lifestyle.
CRED’s business continues to grow
According to the company, it currently has 1.7 crore monthly active members. CRED claims to process more than 40 percent of total credit card bill payments in India. Additionally, the Assets Under Management (AUM) of the lending business operated for partner financial institutions has reached Rs 24,000 crore. The company has also informed about the annual revenue of about Rs 3,200 crore and said that now its business has become profitable.