Fintech startup CredFlow announced on Wednesday its acquisition of Y Combinator-backed business management startup TechBiz in an all-cash deal. While the financial details were not disclosed by CredFlow, sources revealed that the acquisition cost was under INR 10 crore.
CredFlow, a cash flow management platform focused on small and medium enterprises (SMEs), stated that the acquisition of TechBiz would support its expansion in the SME space. The company aims to launch its offering for Busy Accounting Software users in India and globally as a result of this acquisition.
Kunal Aggarwal, the founder and CEO of CredFlow, expressed his enthusiasm about the deal, stating that TechBiz’s expertise and technology would enhance their ability to serve a broader base of SME customers. Aggarwal also emphasized CredFlow’s goal of becoming the default financial operating system for SMEs and expanding its user base.
TechBiz, founded by Pratyush Sharma and Vikramaditya Patil, provides SMEs with timely payment reminders. It was the first startup to offer this service to users of IndiaMART-backed Busy Accounting Software and was featured in Inc42’s ’30 Startups To Watch’ list in 2021.
CredFlow, established in May 2020, offers a cash flow management SaaS platform that assists SMEs in managing their finances. Its services include providing a dashboard of pending amounts by customers, sending timely payment reminders, validating invoices, and negotiating discounts for early payment.
The acquisition was primarily driven by the similar target audience of the platforms, according to insider sources. By acquiring TechBiz, CredFlow gains immediate access to its user base. In addition, CredFlow already supports accounting software Tally and can now expand its market share to Busy Accounting Software users.
The negotiations for the deal began four to five months ago, and as part of the acquisition, Sharma and Patil will join CredFlow’s team to facilitate a smooth transition.
It remains unclear whether Y Combinator, which invested in TechBiz through SAFE Notes, received a return on its investment. The terms of the SAFE Notes typically involve some form of early exit payback, although it is unknown if this was exercised or available in this specific deal.
