Goldman Sachs-Backed Fintech Empowers with Fresh Leadership and Resumes Operations
Wednesday, 17 May 2023, Bengaluru, India
After a chaotic turn of events at the offices of ZestMoney, the Indian fintech company saw its founding members quit the company for good. Following a stressed day, the Buy Now Pay Later (BNPL) startup is all set to revive itself under a new name – ZeMo 2.0 or ZestMoney 2.0.
The startup was recently reduced to only a hundred fifty working members, and all of these members were present in a Townhall meeting where it was decided that the employees will receive variable pay by the end of the month, and hikes for these employees have also been assured. A source told that the company under a new name, has the potential to become profitable again within six months.
The recent reports about the resignation of all the founders of the company raised tons of questions, but the cash-strapped company’s ex-CEO revealed that a new leadership team would take over soon. Lizzie Chapman wrote about it in a LinkedIn post.
“As we go on to the next chapters of our own journeys, we are confidently passing the baton to Mohit Chhajer, Mandar Satpute, and Abhishek Sharma to lead the company into the future. They have all been with us on the journey for a long time, having helped build and scale the company to be the largest digital lending franchise in the country. We have 100 percent belief in ZestMoney’s potential and the 175 incredible ‘Zesties’ who are more than ready to take on the huge opportunity that lies ahead for the company,” Chapman wrote in one of his many LinkedIn posts.
The new leadership team at ZeMo 2.0 comprises Abhishek Sharma, Mandar Satupte, and Mohit Chhajer. All three are a part of FinOps. Abhishek is the head of growth, Mandar the Chief Banking Officer, and Mohit the Vice President.
To survive the chaos, ZestMoney had gotten rid of 100 employees to survive in the game. The situation wasn’t slightly in control. To make a difference, PhonePe took some of ZestMoney’s employees, but the situation didn’t cool down.
Some reports say PhonePe purchased the company’s tech Intellectual Property copy with the founders, board, and investors’ consent. The employees were also hired by PhonePe with everyone’s consent at ZestMoney. PhonePe’s CEO Sameer Nigam took to Twitter to show his concerns for the fintech under deep waters and only wished good for it.
ZestMoney was deliberately waiting for the Buy Now Pay Later platform’s acquisition deal to go through, but in the meantime, PhonePe, the purchasing party, declined. In an interview with Moneycontrol, Sameer revealed that PhonePe decided to not indulge in the acquisition due to unsatisfactory due diligence. With PhonePe gone from the picture, ZestMoney needed cash more than ever. Two months later, all three founders resigned on May 15.
PhonePe didn’t value the deal to be good and backed off from it. The due diligence was supposed to be long, but it was not up to PhonePe’s satisfaction, and it resulted in PhonePe backing off from the deal. This result was devastating for ZestMoney as it was in dire need of money to sustain itself.
PhonePe had already played a major role in ZestMoney’s revival a year before when Sameer first met with the lender’s authority. PhonePe reportedly loaned $18 million to ZestMoney, which was about to go bankrupt.
As per reports, things were about to get back to normal in April, but that didn’t happen. In the past, the Reserve Bank of India (RBI)’s crackdown on digital lending last year didn’t show positive signs for the BNPL sector. Since then ZestMoney was looking for a buyer.
Source – Money control