Zaggle_A platform to address pain points for enterprises

Investment Thesis

Company addressing pain point in Spend Management, Rewards & other white spaces–

Given the company is successfully identifying the white space in enterprise tools and building platform to fill those gaps is a major win for the company.**

Company has been innovating and adding products to make enterprise clients life easier is the biggest strength of the company

Negligible CAC
• Zaggle goes through B2B2C route to reduce the CAC with an innovative business model which gives it an edge vs competitor
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With discounted monthly SaaS fees, Company is more focused on earning money by getting commission on spends through branded cards

Flexible Product / Deployment
• Zaggle can deploy its platform in any enterprise grade HRMS/ERP tool starting from Tally to SAP. This makes it easier to onboard customer and reduced the onboarding time to minimal
•
There is no limitation for the corporate to use Zaggle co-branded corporate cards, Client can keep using only the platform

Win-win proposition for all stakeholders
• Banks –

• Banks get an entry into a large pool of corporate salary relationships.
• Also, they can deploy their co-branded cards at 0 CAC
• There is no tech cost for banks as all the API/ integration is done by Zaggle

Corporate –

• get the card, which is a system of transactions,
• to tightly couple with Zaggle system, which is a system of engagement
• with their system of records which is their ERP

Zaggle –

• Earns commission on propel points and card spends
• Earns SaaS fees platform deployment

Unique business model

• Given it is a Fintech, Zaggle earns at the point of payment by building the processes (which are given to client at minimal cost)

• Lower SaaS fees entice corporates of all sizes to opt for Zaggle platform

Growth Levers

There are 4 levers of growth for Zaggle

1. More number of corporates,
2. Users within that corporate,
3. Greater number of solutions i.e. cross sell and upsell opportunities,
4. The amount of spending which the users do on the cards

Deeper penetration in existing customer groups; currently, only there is only a ~20% overlap in Propel and Save customers

Wide addressable market
• Opportunity size for spends management software pegged at Rs 139bn by FY27**
• Credit card & Prepaid card issued and spent are increasing at rapid pace**
• ARR Payments amounting to ~Rs 8,000 cr. is being done using Zoyer platform**
• Increase in formal workforce is another growth trigger for Zaggle**

High customer retention rates
• Zaggle has strong customer retention capabilities with the churn rate for customers terminating contracts being consistently low (annualized sub-2%)
• With its integrated offerings, the company has been successful in reducing the negative impact of low-switching costs associated with a SaaS business

Experienced promoters with deep domain knowledge
• The senior management team is ably supported by a professionally qualified workforce with extensive knowledge, understanding and experience in the fintech, banking, technology, infrastructure, and healthcare industries. (Refer- Board of Directors & Management Team section)