There are currently only about 100 people working for ZestMoney, which originally had a 500-person workforce. About 170 ZestMoney employees have moved to PhonePe since the failed deal in March.
A digital lending firm called ZestMoney is battling uncertainty as a result of the resignation of all three of its founders. This occurs two months after PhonePe, a Walmart company, failed to complete a scheduled acquisition.
Former ZestMoney CEO Lizzie Chapman, along with Priya Sharma (CFO & COO), and Ashish Anantharaman (CTO), made the announcement of their resignations to the staff on Monday in a touching letter.
In the email, Chapman said, “We have done a lot of soul-searching over the past several weeks, and it’s been painful for us to reach this conclusion.
There are currently only about 100 people working for ZestMoney, which originally had a 500-person workforce. About 170 ZestMoney employees have moved to PhonePe since the failed deal in March.
The Bangalore-based business, established in 2015, was a pioneer in the “Buy Now, Pay Later” market, offering clients quick digital loans made possible by Nahar Credit, an NBFC ZestMoney purchased in 2019.
In November 2022, negotiations between PhonePe and ZestMoney began. According to early reports, PhonePe was planning to buy ZestMoney for between $200 and $300 million. Many fintech companies were interested in the idea of PhonePe entering the NBFC market if such a deal had been made.
However, due to worries about ZestMoney’s credit quality, the transaction was unexpectedly terminated in March.
According to reports, a number of NBFCs are exposed to ZestMoney’s loan portfolio. In spite of this, the fintech business has been successful in raising almost $140 million from prestigious investors, including PayU, Zip, Ribbit Capital, Quona Capital, Xiaomi, Omidyar Network, and Goldman Sachs, among others. In the fiscal year 2022, ZestMoney saw an increase in income to 145 crores from 89 crores; nevertheless, losses also increased, rising to 398.8 crores from 125.8 crores.
In her parting email, Chapman emphasized the founders’ dedication to the business and their faith in its future while pledging to give the incoming management team her undivided attention in order to ensure a smooth transition over the following four months. Almost eight years ago, “we started ZestMoney with a dream of making life affordable for millions of Indians,” she said. “Our incredible team and the distinctive culture we’ve established at ZestMoney” make us incredibly proud.
Chapman, Sharma, and Anantharaman will continue to maintain major shares of the company despite stepping away from their senior positions.
