Around $400 million. That’s how much Snapdeal paid to acquire FreeCharge in April 2015. A significant part of the transaction was in stock. Still, Snapdeal paid out $80 million in cash. Plus, when the acquisition happened, FreeCharge had about $80 million in the bank. At the time, this acquisition was celebrated. It was the largest deal in the consumer internet space in India. Bigger than Flipkart’s acquisition of Myntra ($300 million stock and cash). Cheerleaders heralded the coming of a bigger, stronger Snapdeal plus FreeCharge e-commerce combination; one, which would in some parts take on Flipkart. In other parts, wallet players like Paytm and MobiKwik.

Two years is a blip in the universe. Absolutely insignificant. Another matter altogether that in India, in the consumer internet space, it seems like an eternity. One where fortunes are made and destroyed. And as far as stark reminders go, of our fragile ecosystem, the story of FreeCharge checks all boxes. It is the story of how a seemingly good company, for no fault of its own is getting the can. And how the mighty have fallen. In August 2016, FreeCharge was close to a valuation of $1 billion. Today, buyers aren’t willing to shell out anything more than $70 million. Rider: the deal is still in the process of getting sewn.

Think about this. FreeCharge isn’t a desperate company, fumbling to find a business model. As things stand today, it is the second largest wallet player in India. Behind Paytm. It employs close to about 400-500 people. In any business, the coming together of the No.1 and No.2 players has some semblance of an underlying strategy. Either consolidation to create a larger enterprise or enter a new business or just plain and simple, kill the closest competitor. It is curious then that none of this holds true for FreeCharge. Its fate is tied to the names of its investors on the cap table. That’s all it takes to get the can; because some investors are juggling their portfolio. Read: SoftBank.

The other thing to ponder about is the pointlessness about valuations. So much is made out of them. So much is just on paper.

The Ken emailed a detailed questionnaire to FreeCharge. There was no reply.

Human existence and enterprise revolve around money. Need, access or the lack of it. Multiple current and former employees The Ken spoke with said that throughout last year, it was increasingly becoming clear that FreeCharge didn’t have enough money to fight a good fight. A senior former employee of FreeCharge, who was privy to almost all decisions, said that one must not beat around the bush. “If you cut to the chase, you have to ask yourself a very simple question,” he said.


“Remember last year, when there were so many news articles about PayPal and other players investing in FreeCharge?”