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BNPL company ZestMoney has appointed a new leadership team consisting of Abhishek Sharma (SVP & Head - Growth), Mandar Satpute (Chief Banking Officer), Mohit Chhajer (VP of Finance & FinOps) and also finalising a new investment round from existing shareholders.
The newly-appointed management team is made up of long-term, senior-level leaders who have helped the company scale since its inception. This announcement follows the decision of company’s co-founders Lizzie Chapman, Priya Sharma, and Ashish Anantharaman to step down from day-to-day operations. They will ensure a smooth management transition over the next 3 to 4 months and continue to support the business thereafter as key shareholders.
ZestMoney was in talks with PhonePe for an acquisition deal, but it was later called off after months of business due diligence. According to a source close to the matter, “PhonePe did not going ahead with the deal because the business due diligence of ZestMoney did not meet the required standards.” ZestMoney has also laid off 20 per cent of its workforce after the acquisition deal with fintech major PhonePe was called off. The lending company has a 150-member team currently.
PhonePe was in talks to acquire ZestMoney for $200-300 million, which was lower than ZestMoney’s last valuation of $450 million. ZestMoney has raised $134 million in funding since its inception in 2015.
Fund-raising plan
The company is now finalising a new funding round from existing shareholders, including Quona Capital, Zip, Omidyar Network India, Flourish VC and Scarlet Digital, that is expected to close in the next few weeks. ZestMoney did not comment on its valuation in the fresh funding round.
In a statement to employees, Chapman said, “As founders we are proud of what we have built and achieved so far. But we believe that this is the right time to bring in new management to take the company to the next level. We are confident that the new team will drive the company in the right direction and achieve even greater success. As founders, we will provide full support to the incoming management team and do everything we can to assist them for the next four months to ensure a smooth transition.”
The new management team stated, “We thank the founders for their immense contribution to the company over the last eight years and look forward to building on their success to make ZestMoney a major player in the Indian financial landscape for years to come.”
Since 2015, ZestMoney has provided credit options to millions of Indians who would otherwise be excluded from traditional banking services. While India’s recently introduced Digital Lending Guidelines (DLG) have presented challenges for some providers in the space, ZestMoney said it has continued offering its DLG-compliant lending product through more than 10 platform lenders.
“ZestMoney has continued to scale effectively since the DLGs were announced in India, and we have been impressed with the company’s progress. ZestMoney’s credit quality remains high and the company is close to breakeven. We are happy to support this next chapter for ZestMoney, which promises to be an exciting one on their path to profitability,” said Ganesh Rengaswamy, Managing Partner at Quona Capital.
“The opportunity for ZestMoney remains massive. Less than 4 per cent of Indians have credit cards or access to formal credit. India’s exploding population only points to more opportunity ahead, and we are excited about ZestMoney’s long-term potential,” said Peter Gray, Global COO at ZIP.
ZestMoney was started in 2015 with an automated digital customer onboarding system that integrates mobile tech, digital banking and AI, enabling people to apply for and receive digital credit in mere seconds. Its EMI Network is integrated with Amazon, Flipkart, Myntra, MakeMyTrip and Nykaa, Samsung, Apple, Vivo, Croma, and Reliance Digital. ZestMoney today has more than 10,000 online partners and 85,000 retail touchpoints across India. ZestMoney has more than 17 million registered users.
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