KredX, a Bengaluru-based Fintech start-up is all geared up to disburse INR 1000 Cr. in loans to businesses during the current fiscal year.
Introduction to KredX
KredX offers invoice discounting services to SMEs. They have a product known as ‘Revenue Based Financing (RBF)’ which enables capital access to enterprises based on their upcoming incomes. In the simplest of words, KredX acts as a bridge between SMEs and investors. RBF is essentially a means by which instant capital is handed out to small businesses in their growth stage. By stating proof of immediate revenue like invoices and subscriptions, small businesses promise investors their upcoming earnings in exchange of much-needed capital.
Growth strategy: What did they do right?
Over the years, KredX has disbursed loans to several brands. Their RBF product has worked well with customers with strong presence on the most prominent e-commerce platforms including Amazon, Myntra, and Flipkart. The technology companies that KredX worked with to tweak their cash flow routing were able to gain access to growth capital in less than a fortnight.
They extended a helping hand to more than 25000 businesses and have enabled the disbursal of loans worth INR 7000 Cr. It also helped in their growth that in 2019, KredX received Series B funding of $26 M backed by Tiger Global Management, Sequoia Capital and Prime Venture Partners.
KredX’s RBF product has been incredibly successful on Software as a Service (SaaS) companies due to the recurring revenue model. By becoming the provider of additional funds to the booming SaaS market, Kred’s growth took on an exponential trajectory. They have extended financial assistance to numerous SaaS companies belonging to different industries.
KredX’s approach of fulfilling a real need in business by leveraging immediate future incomes has been immensely beneficial to SMEs. And by fulfilling their needs, the amount and number of investments they have facilitated is staggering.
The combination of RBF and SaaS has worked very well for KredX and targeting this sector has been their main growth strategy.
They extended a helping hand to more than 25000 businesses and have enabled the disbursal of loans worth INR 7000 Cr.
What’s in it for me?
SaaS is booming in India currently and the Indian SaaS market is set to be worth $14B by 2025. There are a lot of marketing opportunities specially for fintech start-ups that are providing financing services to SaaS.
SaaS companies are increasingly on the lookout for funding since they need to access flexible working capital on time. They also need funding for maximising their capacities, reach and for manpower investments.
As a fintech start-up, KredX offered investors a high return alternate avenue for investment which investors could hardly resist. MSMEs are the crux of the Indian economy and through technology innovation in fintech, start-ups can ease their burden by offering financial access.