tech
Meta buys into Cred and names a new WhatsApp boss
Meta is paying $900mn for a fifth of Cred, an Indian fintech. The bigger prize is its founder, Kunal Shah, who will now run WhatsApp.
TL;DR
- Meta is investing $900 million in Indian fintech Cred, securing a 20% stake.
- Cred founder Kunal Shah will take over as the new head of WhatsApp, replacing Will Cathcart.
- This move mirrors Meta's previous strategy of acquiring companies and their founders to lead key initiatives.
- The primary goal is to monetize WhatsApp, which has over 3 billion users but earns little revenue.
- Meta aims to explore new revenue streams such as advertising, subscriptions, and AI agents for WhatsApp.
- India is a crucial market for WhatsApp, and this deal aims to strengthen Meta's position there, particularly with affluent users.
- Cred, founded in 2018, rewards users for timely bill payments and has expanded into payments, lending, insurance, commerce, and wealth.
- Cred has a valuation of $4.5 billion, a partial recovery from its 2022 peak of $6.4 billion.
- Meta receives a minority stake in Cred without board seats or access to customer data; Shah becomes a shareholder.
- Miten Sampat will be the interim CEO of Cred, with an IPO in mind.