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In life, anyone can step into the world of entrepreneurship. There is no age for the sprint of entrepreneurship. Even the Kreditbee founder also started his entrepreneurial journey when he was 35.
If you come with the experience then you can avoid trivial mistakes or if you come early you can seek more experience while building your startup.
This blog will learn about the Kreditbee startup story of how Madhusudan from Karnataka built a company worth $700 million within less than 5 years of its launch.
Kreditbee founder’s family background
Madhusudan Ekambaram comes from a humble middle or upper-middle-class background. His father was a doctor. Like the tradition of every middle-class family, his family put a lot of emphasis on his education.
Madhusudan was one of the 4 siblings. He was one of the youngest among the all. Then he had a series of great educational history, where he completed his Engineering in NIT Suratkal in 2004.
Then his professional life started in the field of Telecom and Ecommerce in various companies. So, over the next 12 years, Madhusudan worked in product development roles from being the junior to heading a unit Global unit of e-commerce for Huawei.
During his role at Huawei, he just noticed a problem with credits for his vendors. So, this very small problem led him to build Kreditbee in 2018.
Kreditbee Startup Story
Madhusudan Ekambaram experienced all the difficulties in raising loans for his vendors in India. So, he then started to research the loan schemes in India.
Then he noticed that it was very difficult for small business owners to get loans without having worthy assets. Even on the other end, the bank was also charging high interest on the credit given to the small business owners.
His research went to other countries as well. According to his research, countries like China and Japan are far ahead in the lending space. Yes, there are many startups that are catering to the small business owners for the credit. So, there was already a huge market in the lending space.
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Kreditbee founder Madhusudan Ekambaram Journey
So, he identified there is a gap in the lending space in India. Whereas traditional banks cater to high-level and mid-level customers. But there are hardly very few lending businesses that cater to the customers for the lower pyramid.
Even Madhusudan Ekambarama also got to know about the rise in spending from the GenZ and millennials. Yes, there was an unprecedented rise in e-commerce in India.
So, youngsters were ready to spend to live an extravagant lifestyle. Even there were no entities that were catering to the college student’s financial needs.
However, Madhusudan was not from a fintech or entrepreneurial background. So, it was a challenging decision for him to enter into the world of entrepreneurship.
At the age of 35 who wants to take a risk and start a startup? But Mahudan did it. As he was the Product head of Huawaei in India unit, so he met many Chinese and Hong Kong investors during his professional life.
So, he took an investment of $2 million from the Hong Kong investor Wan Hong.
Finally, Mahusudan started Kreditbee in 2018.
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Credit Product Testing
As Madhusudan was confident about his product still he needed to test it to get more clarity about the lending space.
So, he got the idea to test his credit game on college students. Then he went near the ground of Dayanand Sagar College where students were busy playing cricket.
There he called the students and explained about the credit. Where a student can borrow a loan of up to 10,000 without having any kind of risks.
So, Madhusudna initially gave credit worth 3 lakhs to various students. But Madhusudan wanted to know how many students were ready for this kind of loan.
Out of his surprise, most of the college students accept small loan amounts.
At this moment he understood that his product would work on the Indian market.
Kreditbee Success Story
So, Madhusudan, Karthikeyan, and Wan Hong invested in Wan Hong and started Kreditbee in 2018.
In just the first month of the operation, Kreditbee had given out a loan worth 2.5 crores. Then in the fifth month loan disbursement amount reaches up to 100 crores.
Here customers need to give an interest amount to the principal they had borrowed. As salaried persons need small credits to reach their commitments. Then there was no such entity to give credit to such a small sum.
But now, Kreditbee was giving out loans via mobile app without any kind of paperwork.
So, Kreditbee did not need any kind of marketing instead they were getting new customers organically. Almost 90% of customers were organic.
Kreditbee Revenues
By the end of 2019, Kreditbee had almost made 19 cores PAT(Profit after Tax).
Even in 2020, this company disbursed a loan worth 7,700 crores. Kreditbee founder Mahusudan claims that they hold the majority of the market in the lending space.
Before Covid, there were almost 1600 lending apps on the playstore. During COVID, it was tough for Kredibee as well. There was no cash flow and even government-developed lenders should not force their customers for the interest amount for over 6 months.
So, a lot of lending apps were not functional and later the entity entirely stopped functioning. Even Kreditbee had the time when it could have money to give salaries to their employees.
But somehow they survived the COVID-19 pandemic economic uncertainty. After Covid there were hardly 80 lending apps were functioning.
In 2022- 23, their revenue was 717 crores and made 65 crores of profits. Even in 2023, their loan disbursement reached 14,000 crores.
As of now, Kreditbee has gotten over 50,000 online applications for the credit. But hardly 5% of the applications i.e.,5000 to 6000 applications were getting loan and verification process.
Fundings
Kreditbee a fintech player till now raised over $404 million at a valuation of $700 million.
On January 2023 it took the funding worth $120 million from Japanese bank, Mitsubishi UFJ Financial Group along with existing investors Premji Invest, Motilal Oswal Alternates, NewQuest Capital Partners, and Mirae Asset Venture Investments.
Now Kreditbee founder Madhusudan Ekambaram has a vision to expand their credit line to farmers as well.
So this is the Kreditbee founder story.