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Kunal Shah - Founder & CEO, CRED
Kunal Shah is an angel investor, founder of CRED and previously founded FreeCharge. CRED is a is a members-only credit card bill payment rewards platform that incentives and rewards members for clearing their bills on time.
He has served as a part-time partner at Y Combinator and an advisor at Sequoia Capital.
He holds a BA in Philosophy from Wilson College, Mumbai. He went on to pursue an MBA from Narsee Monjee Institute of Management Studies in Mumbai but dropped out.
Journey From A Working Student To CRED Founder
CRED founder Kunal started working at 15 to help his family tide over a financial crisis. He continued working while pursuing his bachelor’s degree and had gigs as a freelance designer and programmer. He later built a small SaaS company called PaisaBack, a cash-back and promotional discount campaign platform for retailers, which eventually turned into FreeCharge in 2010.
FreeCharge was acquired by Snapdeal in 2015 and Kunal continued overseeing operations before exiting in 2016. In 2017, the firm was acquired by Axis Bank.
In 2018 he set up CRED, an app where users can make credit card payments and earn rewards. At present, CRED has over 5 million users and processes about 20% of all credit card payments in India. It is now the second-fastest Indian startup to emerge as a unicorn, valued at $1 billion or more.
He has also acquired the role of a Business Advisor for companies such as Bennett Coleman and Co. Ltd. (Times Group) and AngelList.
Kunal is helping the entrepreneurial community by investing in multiple projects such as Go-Jek, Zilingo, Unacademy, Shuttl, Chillr, Innov8, Lifcare, TinyOwl, Spinny, Jugnoo, Mobile Premier League (MPL), Azani, Tapzo, Runnr, Flyrobe, Razorpay, Voonik, TVF, PocketAces, Rupeek, Dil Mil and more.
Net Worth
While Kunal Shah’s net worth is not known in exact terms, it is over the $500 million mark.
Anecdotes from an Entrepreneurial Journey
In this edition of the #InsightsPodcast series, we are joined by Kunal Shah, Founder and CEO of CRED, and Founder and former CEO of Freecharge.
Freecharge was part of the first wave of ecommerce startups in the country, along with the likes of Flipkart and Paytm. It was acquired for $450 million by Snapdeal in 2015, making it the biggest startup M&A in the Indian startup ecosystem at the time.
In the podcast, Kunal starts off with talking about his early days, and how he started working at the early age of 15 to help his family tide over a financial crisis. He juggled a full-time job while pursuing a bachelor’s degree in philosophy (which he chose based on class timings given his work commitments) and some freelance work in the evening, making him financially independent at a very young age.
He talks about his journey from a being a freelance designer and programmer to building a small SaaS company that pivoted many times to eventually become Freecharge. After the acquisition of Freecharge, Kunal had a couple of stints in investing, before deciding to start up again in 2018 with Cred.
In true entrepreneurial spirit, Kunal jokes about how he has done almost everything under the sun — from selling music CDs and mehendi, to running a SaaS business and even a BPO company. He also had a laptop import business for a while before finding his calling with ecommerce.
On how he achieved the product market fit for FreeCharge, Kunal says it started with the simple idea of offering a mobile top-up (which was the largest selling product at the time) free of charge to draw enough customers on the platform to potentially build a business. This was very much on the lines of the ‘loss leader strategy’ adopted by grocery stores to attract footfall. Kunal says he saw big opportunity in the mobile recharge space, which had a use case for 99 percent of the population who were on the verge of getting comfortable with online transactions, thanks to IRCTC.
That, along with reduced interest among merchants who were selling mobile recharges offline due to diminishing margins, made it a no brainer for these transactions to move online. As Kunal puts it rather nicely, “I saw recharge as the gateway to a transacting India.”
He calls himself a mediocre founder who found a great product market fit, and adds, “Terrible product market fits, even with the greatest founders, can never create value. Fighting headwinds never creates value, you only burn fuel.”
In the podcast, Kunal also talks about how it is challenging to get investors and team members on board when dealing with original ideas that do not have any global models to serve as comparables. Interestingly, it is these original ideas that have disproportionate wealth creation opportunities.
Kunal also gives the listeners a glimpse of the philosopher in him as he explains how platforms with a high frequency of transactions almost always win because the trust and habit built over many transactions enables such categories to expand faster in a mistrust democracy like India.
He also speaks of his famous Delta 4 theory, which encapsulates the need for new products to create significant delta in value creation for the customer through superior product/ service experience, making the switch from old behaviour to new behaviour irreversible, instead of giving massive discounts to infuse the delta in value creation for customers which is not sustainable without systematic change in consumer behaviour .
Answering a few questions from the audience, Kunal shares some words of wisdom for fellow entrepreneurs to succeed in a rapidly changing world.
From Vision to Victory: Kunal Shah's Pioneering Path in Fintech Revolution
Kunal Shah is a standout figure in India's start-up world, particularly in the fintech sector. As a co-founder of Freecharge, he's played a pivotal role in transforming digital payments in India, making transactions smoother and more accessible. His innovative vision has not only driven Freecharge to remarkable success but has also made a significant impact on the global fintech stage. Later, Shah launched CRED, a popular rewards platform that has captured the attention of many in India. Known for its user-friendly interface and fantastic rewards, CRED has quickly become a household name in the country's startup realm. Shah's journey, from a philosophy graduate to a billionaire entrepreneur, is a powerful example of how innovative ideas and dedication can lead to remarkable success. His story serves as a guiding light for aspiring entrepreneurs in India, showcasing the endless possibilities that come with curiosity and ambition.
Kunal Shah - Personal Life
Kunal Shah, born on May 20, 1983, in Mumbai, Maharashtra, hailed from a family where his father worked as a businessman, and he often assisted him. When Shah was just 14, his family faced financial difficulties due to his father's struggling business. To help out, he began working at the age of 15. He completed his Bachelor of Arts in Philosophy from Wilson College in Mumbai. Although he started an MBA at Narsee Monjee Institute of Management Studies in Mumbai, he decided to leave the program. Shah's spouse, Bhavna Shah, works as a freelance graphic designer.
Kunal Shah - Early Life
Shah's journey into entrepreneurship showcases his unwavering determination and love for innovation. Growing up in Mumbai, India, he showed an early interest in technology and business. After finishing his studies, Shah set out on his entrepreneurial path. His journey began with PaisaBack, his first startup launched in 2009. Initially focusing on promotional discounts, laid the groundwork for his future endeavors. Following this success, Shah, along with Sandeep Tandon, co-founded Freecharge in 2010. Their goal was to revolutionize the payment landscape by offering a simple way for users to recharge their phones and pay bills online. Then, in 2018, he established CRED, a platform for managing credit cards that rewards users for responsible card usage.
Kunal Shah - Career
Under Shah's guidance, Freecharge rapidly gained popularity, attracting millions of users and catching the eye of investors. In 2015, the company made headlines by being acquired by Snapdeal, a major Indian eCommerce platform, in a groundbreaking deal worth over $400 million. This acquisition was a significant milestone for Shah and Freecharge, confirming the success of their innovative business model and positioning them as leaders in India's growing fintech sector.
A key factor contributing to Freecharge's rapid growth was Shah's keen understanding of consumer behavior and market trends. He identified the increasing demand for digital payment solutions in India, driven by the widespread use of smartphones and internet access. Building on this insight, Shah and his team created a user-friendly platform that simplified the recharge process and rewarded users with cashback and discounts, a novel concept at the time.
In 2018, Shah ventured into a new endeavor by launching CRED, a platform that incentivizes users to pay their credit card bills on time. With CRED, Shah aimed to tackle the rising issue of credit card debt while offering exclusive benefits to users. Once again, Shah showcased his ability to identify untapped market opportunities and develop innovative solutions. The platform's premium membership program offers exclusive rewards and benefits to its members.
CRED quickly became one of India's most popular financial apps, with over 10 million downloads and processing about 20% of the country's credit card payments. Its unique approach to credit card management, combined with its focus on building a community of high-creditworthy individuals, resonated strongly with users nationwide. Today, CRED has millions of members and is one of India's most valuable fintech startups, with Shah leading its growth and expansion. With $200 million in funding, CRED achieved a $2 billion valuation in 2021.
Kunal Shah - Journey so Far
Kunal Shah's journey, from co-founding Freecharge to launching CRED, showcases his exceptional leadership skills and entrepreneurial talent. His continuous drive for innovation, combined with his deep grasp of consumer behavior, has propelled him to the forefront of India's fintech revolution. As he continues to explore new avenues and push the boundaries of what's possible, Shah serves as a guiding inspiration for aspiring entrepreneurs and plays a vital role in shaping the future of digital payments.
Shah's impact extends beyond his startups. He's a prolific angel investor, backing over 200 companies, including successful ventures like Razorpay, Unacademy, and Innov8.
Apart from his entrepreneurial ventures, Shah is renowned for his insightful perspectives on technology, business, and human behavior. As an active speaker and thought leader, he frequently shares his expertise and insights on various platforms, providing valuable guidance to aspiring entrepreneurs and industry enthusiasts alike. Shah's astute understanding of emerging trends and his knack for anticipating market shifts have earned him widespread recognition and admiration within the startup community.
Kunal Shah - FreeCharge
In 2010, Shah leaped and established FreeCharge, a digital payments firm offering discounts and cashback to users for their transactions. Initially focusing on mobile recharges, he swiftly broadened its scope to encompass other services like bill payments. Through his innovative approach and unwavering determination, Shah transformed FreeCharge into a widely recognized name in India's digital payments sector. The company experienced rapid growth, attracting investor interest and culminating in one of the largest acquisitions in India's startup landscape. In 2015, Snapdeal acquired FreeCharge for an impressive $400 million, solidifying Shah's reputation as a prominent entrepreneur in the country.
Kunal Shah - CRED
Noticing the confusion many Indians faced with credit cards, Kunal Shah identified an opportunity to simplify credit card management and improve financial control. In 2018, he established CRED, a platform rewarding users for responsible credit card usage. Because of Shah’s vision, CRED has become one of India's most popular financial apps. Its user base has grown swiftly, and the platform now offers services such as credit score tracking, bill reminders, and convenient payments for multiple credit cards. CRED's premium membership program also provides exclusive rewards and benefits. Additionally, CRED allows users to make house rent payments and offers short-term credit lines. By April 2021, the company had attracted over 5.9 million users and processed around 20% of all credit card bill payments in India. CRED introduced six products, including Cred RentPay, Cred Cash, and Cred Pay. Moreover, in August 2021, CRED launched Cred Mint, a Peer-to-peer lending feature aiming to monetize its 7.5 million users. CRED served as the official sponsor of the Indian Premier League (IPL) from 2020 to 2022.
Kunal Shah - Philanthropy
Shah strongly believes in innovation's ability to bring about positive transformations and uplift communities. Through his charitable efforts and mentorship initiatives, he actively encourages and guides aspiring entrepreneurs, enabling them to pursue their ambitions and make significant contributions. His steadfast dedication to fostering innovation and entrepreneurship reflects his broader goal of creating a better and more equitable future for everyone.
Kunal Shah - Controversies
Cred has faced criticism for being overvalued and lacking a clear strategy for making money.
Shah sparked a debate on social media by asserting that success comes from personal effort rather than being inherited.
CRED’s CEO Shah, faced backlash after revealing his salary. During an 'Ask Me Anything' session on Instagram, he disclosed his monthly salary. Responding to a user who was surprised by his modest salary, Shah explained that he earns ₹15,000 per month because he believes he shouldn't receive a higher salary until the company becomes profitable. He also mentioned that he could manage with this salary because he sold his previous company, FreeCharge, for a significant amount.
Kunal Shah - Awards and Recognitions
Kunal Shah has received many awards and honors for his remarkable journey, highlighting his creative ideas, entrepreneurial talent, and leadership abilities. Some of his notable achievements include:
· Forbes India Leadership Awards (2015)
· Entrepreneur of the Year (2016)
· Top 10 Most Innovative CEOs (2017)
· Young Business Leader (2018)
· India's Most Admired Entrepreneur (2019)
· Impactful Tech Leader (2020)
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