Exclusive: CRED-Owned Happay Trims 35% Workforce

SUMMARY

Around 160 employees across departments including sales, marketing, tech, product, and operations, were let go

In December 2021, CRED announced acquiring Happay in a cash and stock deal worth $180 Mn

In FY22, CRED’s revenue rose to INR 422 Cr, whereas its loss climbed to INR 1,279 Cr

Fintech unicorn CRED-owned Happay has reduced its workforce by approximately 35%, sources privy to the development informed Inc42.

On Friday (May 12, 2023), teams were informed about the restructuring by their respective managers.

According to Happay’s LinkedIn profile, the startup has more than 450 employees. This indicates that at least 160 employees across various departments, including sales, marketing, tech, product, and operations, were let go as part of the significant restructuring exercise.

As part of the severance package, the startup is offering employees three months’ salary along with additional benefits, such as an extension of insurance coverage and job placement assistance.

Another source has stated that the restructuring exercise was part of the annual appraisal cycle and was linked to employee performance.

Inc42 has reached out to CRED for comments. The story shall be updated as and when we receive more details from the company.

Founded in 2012 by Anshul Rai and Varun Rathi, Happay is a business expense, payments and travel management platform.

In December 2021, Kunal Shah’s CRED announced the acquisition of Happay in a cash and stock deal worth $180 Mn.

“With professional expenses forming a significant portion of credit card spending, bringing professional expense management into the CRED ecosystem is a natural extension of our proposition,” CRED founder Kunal Shah had then said in a statement.

As part of the acquisition, it was announced that Happay would continue to operate as a separate entity, and all of its employees would also receive rewards under CRED’s ESOP schemes.

CRED, founded in 2018 by Kunal Shah, offers premium credit card users rewards and benefits for paying their bills. The fintech giant has also forayed into the ancillary services business built around its primary ecosystem of credit card-centric services.

Last year, CRED had also acquired lending-as-a-platform CreditVidya in a mix of cash and stock deal, to expand its credit products’ portfolio.

Over the last couple of months it has introduced several new features and services to expand its offering, these include:

Unified Payments Interface (UPI)-based peer-to-peer (P2P) payments system
CRED escapes — a curated travel platform that offers stays, experiences and ‘other privileges’ for CRED customers
Buy-now-pay-later (BNPL) product — CRED Flash
Tap-to-pay offering for retail payments using credit cards
‘Scan & Pay’ to enable its customers to make payments directly through their bank accounts.

In FY22, CRED saw its total revenue increase to INR 422 Cr, a 4.4X jump from INR 95 Cr in FY21, while its losses ballooned to INR 1,279 Cr, a 2.4X increase from INR 524 Cr. The fintech unicorn’s marketing expenses increased by 3X to INR 975 Cr from INR 324 Cr in FY21.

The startup, which is valued at $6.4 Bn, has raised over $800 Mn in funding since its inception. Last year, amidst the funding winter, CRED bagged $140 Mn as part of Series F round from Singapore’s GIC. CRED counts Sequoia Capital, Tiger Global, Alpha Wave, and Dragoneer Investments, among others, as its backers.