Cred records Losses of Rs. 360 Crore on operating revenues of just Rs. 52 Lakh in FY20



Kunal Shah’s startup Cred has registered losses of Rs. 360 crore in FY20. Its operating revenue for the year was just Rs. 52 lakh, and the rest of of its revenue, Rs. 17.5 crore, was made from interest on its fixed deposits and current investments. Cred’s expenses, on the other hand, were Rs. 378 crore.

The bulk of Cred’s spending was on rent, fuel, conveyance, legal and advertising expenses, which was Rs. 244 crore. Employee expenses were another Rs. 73 crore. Crucially, these numbers are only till March 2020, and likely don’t include Cred’s marketing blitz on the IPL, and its ads which featured celebrities including Madhuri Dixit, Bappi Lahri, Anil Kapoor and Govinda.

Cred now has 5.9 million relatively affluent users on its platform, and can presumably find ways in the coming years to monetize them. Cred is already promoting high-end products on its app, and it could use its app as a distribution channel for these companies. Cred also has financial data of many of its users, which could enable it to offer financial products and loans.


And Kunal Shah is someone who’s been there, done that. Shah had sold FreeCharge to Snapdeal at a valuation of $400 million in 2015. Two years later, Snapdeal had in turn sold the company to Axis Bank for $60 million. Given how Freecharge has fallen off the radar as far as online payments are concerned, it’s likely now valued at even lower than $60 million. Cred, for its part, already commands a valuation of $800 million. Startup success in India doesn’t necessarily require one to create a thriving, sustainable business — the more important factor might be knowing when to exit.