Buy Now Pay Later (BNPL) startup ZestMoney, valued at $450 million at its peak, has been acquired by non-banking finance company DMI Finance.
Shutdown and Layoffs
The acquisition was made through a fire sale deal after ZestMoney officially shut down its operations on December 8. The firm also announced the layoff of 150 employees last month due to failing profits and slow growth.
DMI Finance’s Preferred Lender Status
DMI Finance, the NBFC arm of DMI, will become a preferred lender on the Zest platform, gaining exclusive rights to use all Zest brands. The acquisition allows DMI to expand its engagement with customers by adding ZestMoney’s checkout financing platform to its product suite.
Strategic Benefits for DMI
DMI brings its customer base, balance-sheet strength, and risk-management experience to drive growth across Zest’s online and offline merchant network.
ZestMoney’s Funding History
ZestMoney had raised over $130 million during its eight years and was backed by firms like Goldman Sachs, PayU, Quona, Zip, Omidyar Network, and Ribbit Capital.
PhonePe Deal Collapse Impact
The collapse of a potential acquisition deal with PhonePe in November 2022 contributed to ZestMoney’s struggles, leading to layoffs and the eventual shutdown.