ZestMoney gets new leadership as founders step down

After all the three co-founders of troubled fintech startup ZestMoney stepped down, the Goldman Sachs-backed platform has set in place a new leadership team to take charge, along with plans of raising fresh funds.

Abhishek Sharma, Head of Growth; Mandar Satpute, Chief Banking Officer; and Mohit Chhajer, Vice President of Finance and Financial Operations (FinOps)--all internal appointments--will assume responsibility for leading ZestMoney.

“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,” former Co-founder Lizzie Chapman wrote in a LinkedIn post.

“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% 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," she wrote.

On May 15, the Co-founders—Lizzie Chapman, Priya Sharma, and Ashish Anantharaman—announced their resignations to 175 employees, during a company townhall. 

“Over the last few weeks, we have done a lot of thinking and whilst it has been very hard for us to arrive at this conclusion, we have decided that we will step away from our Operating roles as CEO (Lizzie), CFO & COO (Priya) and CTO (Ashish),” the management informed the team. 

The trio will continue to be significant shareholders in the company. 

The development comes two months after the much-talked-about acquisition deal of the BNPL platform with PhonePe fell through. The Walmart-backed fintech decacorn was in talks to acquire ZestMoney for $200-$300 million since November 2022. However, in March, it walked away from the deal citing issues with due diligence. 

In fact, PhonePe had given a loan of about $18 million last year to the firm, which acted as a ‘lifeline’ for the company. 

Fresh capital, path to profitability roadmap

Besides setting up new leadership team, ZestMoney is looking to finalise a new investment round from its existing shareholders, including Quona Capital, Zip, Omidyar Network India, Flourish VC and Scarlet Digital, that is expected to close in the next few weeks. This new capital will support the future growth of the business and finance the path to profitability, the company said in a statement.

Started in 2015, ZestMoney claims to have over 10,000 online partners and 85,000 retail touchpoints across India to provide digital credit, in partnership with financial institutions.

"ZestMoney has continued to scale effectively since the DLGs were announced in India, and we have been impressed with the company’s progress,” said Ganesh Rengaswamy, managing partner at Quona Capital.

“The company's credit quality remains high and it is close to breakeven. We are happy to support this next chapter for ZestMoney, which promises to be an exciting one on their path to profitability," he said.

Peter Gray, Global COO at ZIP, added,"The opportunity for ZestMoney remains massive. Less than 4% of Indians have credit cards or access to formal credit. India’s exploding population only points to more opportunity ahead, and we are excited about ZestMoney’s long term potential.”

Meanwhile, on reports of PhonePe taking over ZestMoney's assets and onboarding its employees, its Co-founder and CEO Sameer Nigam clarified the company did not take over the latter's assets. “We bought a copy of their LSP tech IP & separately hired ~130 ZM employees. The Tech IP *copy* was purchase with the company's founders, board and investors' consent. The employees were hired with ZM's consent since they had to downsize,” Nigam wrote in reply to a Twitter post.

PhonePe has also absorbed some of ZestMoney’s employees.

(The copy was updated to correct spelling and include company's statement.)