Bangalore, India / Beijing, China, October 16 — India-based ecommerce and credit service KrazyBee receives Series A funding of $8m led by Chinese phone manufacturer Xiaomi and Shunwei Capital. In 2016 KrazyBee went through two Seed Rounds, from which one was worth $2m by Chinese companies Yeahmobi and Fenqile as well as another round worth $3m from Plum Ventures, also based in China.
This type of investments might be related to the connections of KrazyBee cofounder Wan Hong, who previously worked for Huawei since 2005 and was on-site in India since 2010. As per his LinkedIn description, he is there to bridge Chinese business models into the Indian market.
What is KrazyBee so krazy about?
KrazyBee was founded in 2016 and their declared mission is to help young people, especially college and university students, to buy things they want, but don’t have the money for, by lending them the money with a credit. The users will be checked for credibility and then they have access to the KrazyBee online store which consists of consumer electronics such as smartphones, headphones. Cameras, tablets, laptops, and televisions.
The lending system also works with third parties like Amazon, Flipkart, Snapdeal, Paytm, Healthkart and others. On the KrazyBee page for terms and conditions they also reference a Finnovation Tech Solutions Private Limited as service providing legal entity.
Why could that be interesting for Xiaomi?
There are not many facts available for the long-term reasons for the investment. We are missing press releases on both sides of the deal. It could be that Xiaomi wants to integrate the KrazyBee system for financial transactions as an app into their own smartphones and OS. It could also be that they merely seek to invest in a disruptive startup and penetrate the markets for mere ROI reasons.
From the available information, we could not say that this could be an attack on AliPay other FinTech companies in China or India. At the very least, they can bump up their brand exposure on the KrazyBee shop with the newly gained influence.
“KrazyBee’s mission is to make credit for young professionals and college students in India accessible and affordable. We are actively working towards a risk algorithm that helps us achieve a system-generated decision on every profile, and we are optimising that further in terms of efficiency and accuracy,” said Madhusudan E, founder, and CEO, KrazyBee, which has three lakh registered users and 50,000 active borrowers.
“The Indian demography has a large population of urban young adults that spend a lot online and offline. For such an enormous ecosystem, the need for urgent personal finance for purchase requirements is highly underserved. An appropriate focus towards tech-based credit evaluation and compliant sourcing of funds can help capture and penetrate this market big time,” said Shirley Mao, investment director, Xiaomi Technologies of KrazyBee, which operates in 800 colleges in India.
YouTube: KrazyBee – India’s largest student credit platform