Expense management for enterprise customers
Angel Prime-backed Happay, a business expense management solutions company, aims to take its product deeper into the B2B segment and handle all their expense management needs. It also plans to onboard around 10,000 businesses in the next two years.
When IIT Kharagpur alumni, Anshul Rai and Varun Rathi, first conceptualised Happay and setup the company in 2012, it was a customer product that was targeted at students and young professionals to solve their peer-to-peer payment issues. However, they understood that it was a very consumer driven product and the cost of acquisition and retention of the customer was high. In the meantime, the duo also noticed that there was a gap in the B2B space as companies approached them for a solution which can be used to optimise their internal operations. This set them thinking and after some research they found that businesses are not getting anything apart from the current account to manage their expenses. Rathi says, “There was no solution for corporates to manage their expenses and hence, they were forced to mould their processes based on what was on offer instead of the other way around.” This made the duo enter this space in early 2015 and build a completely horizontal product which integrates well with the current processes of the user organisation.
Today, Happay is an expense management solution consisting of Happay Prepaid Visa Cards that can be managed and controlled via desktop and mobile. Its solution streamlines the expense workflow of an organisation from end-to-end (expense reporting to reconciliation) and gives them real-time visibility and control over business spends. These cards are given to all the employees who spend on the company’s behalf for any kind of business expense. It now has almost 2,000 customers across 40 verticals which include manufacturing, restaurants, retail stores, IT services, pharmaceutical companies and so on. The company is onboarding around 100 to 150 companies every month. The annual volume of business is around Rs. 450 crore and the company aims to reach Rs. 800 crore by March 2017. The team size has grown 10 times in the last 20 months.
The company raised US $500,000 in 2015 from Prime Venture Partners (renamed from AngelPrime), a seed-stage fund based in Bengaluru and is using these funds to develop products, improve marketing and expand its technical and sales team.
Taking it to the market
As far as its marketing goes, Happay has a large on ground presence, but 20 per cent to 30 per cent of its traffic comes through the online advertisements or content which it creates, specifically targeted at businesses. “A lot of second generation businessmen are signing up online for a demo even from remote areas and these are businesses we have on-boarded without meeting them,” says Rathi. The Happay team takes on face-to-face meetings with companies who either fall into the large and medium segment or the SME segment.
Beware of fraudsters
A very specific challenge that companies from this sector face is that of fraudulent users. “It is specific to our segment as it is lucrative and it is hard to identify the right ones from the wrong ones. That is where we have to draw the line and not entertain such businesses,” says Rathi.
In the last 20 months, Happay has launched many modules in the business expense management space. It has grown from a simple expense management solution provider, meant for small companies, to an enterprise product with eight to 10 modules which can cater to all the business expenses of an organisation; like employee reimbursement, tax benefits, food and medical reimbursements and so on. It has also launched a digital marketing expenses product targeted at marketing teams of companies. “This is a good alternate to personal credit cards, which they typically use,” says he. It has a product module for vendor payment and a specific module for people travelling outside India. All these are part of the same solution.
Recently, as a direct outcome of demonetisation, the company has launched a product specific to the transportation sector. All businesses which run heavily on cash realised the value of going cashless and are coming forward to take that step. “Our product allows them to issue cards to the driver, do bulk payment and save a lot of time for them,” says Rathi. While currently, there is a demand from the transportation business, any sector depending heavily on cash can use this product.
Going forward, the company aims to get deeper into the B2B segment and handle all their expense management needs. “The market is also becoming more receptive to this concept of a combined solution to manage all their expenses,” states Rathi. The company plans to introduce the current account plusconcept soon. Explaining further, Rathi says, “You have been dealing with a simple current account, but all the businesses need plus of that which helps them cater to every expense going into the system and manage the workflow, not just the payments.” With all these strategies in place, Happay aims to on-board about 10,000 businesses in the next two years and take long strides in the fintech sector.
Founders: Varun Rathi and Anshul Rai
Concept: Happay is an expense management solution consisting of Happay Prepaid Visa Cards that can be managed and controlled via desktop and mobile. Employees use Happay Prepaid Cards for business expenses like travel, fuel, accommodation, utility payments, petty cash expenses etc.
Investors: US $500,000 from Prime Venture Partners
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