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First Principles
Kunal Shah of CRED on “exciting but painful” workplaces, gated digital communities, and employee shareholders
Mar 29, 2023
02:01:17
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Quick takeaways
- Kunal Shah is focused on catering to the top segment of India's consumer pyramid as they have enough disposable income to drive most discretionary spends.
- Cred aims to create a community of trusted individuals and build a frictionless world for them, reshaping how commerce, networking, and payments are conducted.
- Cultural change in India is crucial to encourage risk-taking behavior, appreciate individual achievements, and support women in the workforce.
- The podcast emphasizes the significance of credit scores in various aspects of life and the potential benefits of incorporating them in different areas to promote good behavior and reduce risks.
Deep dives
Kunal Shah's Motivation
Kunal Shah is driven by the transformation and growth of individuals. He finds fulfillment in supporting people in achieving their full potential and witnessing their journey from the front row. Kunal believes that creating more talent, risk-taking behavior, and entrepreneurs is essential for India's prosperity.
Kunal Shah's Drive as an Entrepreneur
As an entrepreneur, Kunal is motivated by doing things that others think won't work out. He finds joy in proving skeptics wrong and going against the grain. At Cred, what drives him is the journey of the people within the company. He has witnessed transformations in leaders and believes in their growth and development, even though it can be a challenging and painful process.
Understanding Cred's Purpose
Cred aims to be a community of selected individuals based on their trustworthiness and creditworthiness. The platform strives to create a frictionless world for its trusted members, where they can benefit from exclusive offers and experiences. The goal is to build a city-like environment where trustworthy individuals come together and reshape how commerce, networking, and payments are conducted.
Kunal Shah's Perspective on Society and Work
Kunal emphasizes the importance of cultural change in India, particularly in terms of encouraging risk-taking behavior, appreciating individual achievements, and supporting women in the workforce. He believes that as a society, India needs to foster an environment where people take pride in their work and focus on excellence rather than seeking external validation. Kunal also recognizes the need for companies like Cred to document decisions and create a repository of organizational knowledge to drive scalability and avoid repetition of mistakes.
Importance of Credit Scores and Trustworthiness
The podcast episode discusses the importance of credit scores and trustworthiness in various aspects of life, including financial transactions, renting apartments, and even employment. It emphasizes the need for credit scores to be used more widely, as they can help in making informed decisions about individuals' reliability and trustworthiness. The episode mentions examples from countries like China and Japan, where credit scores are utilized in dating apps and landlord-tenant relationships. The speaker highlights the potential incentives and benefits of incorporating credit scores in different areas of life, promoting good behavior and reducing risks.
Culture and Values in Evaluating Team Members
The podcast delves into the significance of culture and values in evaluating team members. It emphasizes the importance of building a culture that is not only based on performance but also on shared values within the organization. The speaker discusses how Cred appraises its employees based on the organization's values rather than just focusing on performance metrics. This approach ensures that team members not only excel in their work but also exhibit values like trust, problem-solving, and accountability. The podcast highlights the need for values to be integrated into daily conversations and decision-making processes to create a strong and consistent culture.
The Role of Motivation and Ownership Mindset
The podcast explores the role of motivation and ownership mindset in driving success and innovation. It emphasizes the importance of hiring talented and motivated individuals who have an ownership mindset. The speaker discusses how an owner mentality brings about a sense of accountability, self-motivation, and a willingness to go beyond expectations. The podcast mentions the significance of self-awareness and feedback in fostering personal and professional growth. It also highlights the importance of creating a culture of trust, care, and shared ownership to enhance team dynamics and drive collective success.
Welcome to episode 16. If you like our deep interviews with some of India’s best known founders across a range of domains, please rate us on your favourite podcast platform. All it takes is just a few seconds.
Kunal Shah, the co-founder and CEO of CRED is unapologetic about building products for the top segment of India’s massive consumer pyramid. One would imagine that having raised over $600 million in venture funding puts the pressure on a founder to show a potential market size that’s massive and untapped.
And yet, Shah did quite the opposite. He is single minded in his focus on catering to the top 30-odd million consumers in the world’s most populous country. Why? Because they are the ones with enough disposable income to drive the majority of most discretionary spends, he says. CRED currently has over 11 million users, which fit the definition of “California users” put forth by my colleague Praveen Gopal Krishnan way back in 2021.
And over the last two years, this has become painfully apparent to most Indian startups and founders.
How did CRED and Kunal Shah arrive at this reality ahead of others? I asked him that.
Shah has a habit of saying “Good question” before launching into fairly sprawling and vivid answers. Answers that involve analogies, generalizations and psychology.
Having been thrust into working to support his family while he was still a teenager, Shah ended up being coached through the school of hard knocks and an accidental exposure to philosophy (it was the only course available in the morning, before he left for work).
The result was a curious mix of abilities, knowledge, ambitions and perspective. Chip on the shoulder mixed with the urge to pay it forward. The ability to put himself in another person’s shoes while also being brutally blunt with feedback. Left brain execution and right brain exploration.
This has allowed Shah to create a fairly shape-shifting business model with CRED (worth over $6 billion after its last fund raise). When I asked him to define CRED, he described it in terms of its users, not features. He sees CRED as a community, to which features and monetization methods can be tacked on and off over time.
In another wide-ranging and reflective founder conversation, we go behind Shah’s thoughts about building businesses, hiring “high-slope” professionals, why one of the biggest crises staring India in the face is the disappearance of working women and why many meetings inside CRED as called “shareholder meetings”.
And if you have any questions, thoughts, suggestions, or tips, please email them to podcasts@the-ken.com. We might not be able to reply to all of them but we do read every single one of them.
This is episode 16 of First Principles.
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