In a strategic move to bolster its corporate travel services, MakeMyTrip, India’s leading online travel company, announced on November 18, 2024, the acquisition of Happay, a prominent corporate expense management platform, from fintech firm CRED. This acquisition aims to integrate expense management solutions into MakeMyTrip’s offerings, providing a seamless experience for corporate clients.
Background
- About MakeMyTrip:
Founded in 2000, MakeMyTrip has established itself as a dominant player in India’s travel and hospitality industry. The company offers a comprehensive range of services, including flight bookings, hotel reservations, and holiday packages. In recent years, MakeMyTrip has expanded its focus on corporate travel services, aiming to provide tailored solutions for business travellers.
- About Happay:
Established in 2012 by Anshul Rai and Varun Rathi, Happay is a Bengaluru-based company specializing in corporate expense management. The platform serves over 6,000 businesses, managing work-related expenses for more than one million users globally, with approximately $1 billion in annual spends. Happay’s clientele includes prominent organizations such as the Tata Group, PwC, Maruti, and OYO.
- About CRED:
Launched in 2018 by Kunal Shah, CRED is a fintech company that began as a platform for credit card bill payments, rewarding users for timely payments. In December 2021, CRED acquired Happay in a cash and stock deal valued at $180 million, marking its entry into the corporate expense management sector.
The Deal
On November 18, 2024, MakeMyTrip announced the acquisition of Happay’s expense management platform from CRED through a business transfer agreement. While the financial details of the deal were not disclosed, the acquisition aligns with MakeMyTrip’s strategy to offer comprehensive corporate travel and expense management solutions. The transaction involves the transfer of the Happay brand, its expense management division, and its dedicated team to MakeMyTrip.
Rajesh Magow, Group CEO and Co-Founder of MakeMyTrip, stated, “By concentrating on innovation and a smooth user experience, we have continuously outpaced industry growth in the corporate travel sector over the past few years.” He further added that the acquisition of Happay’s expense management technology and brand is the next logical step in their plan to dominate this market.
The deal is expected to close within the next ninety days, during which the Happay team will continue to support existing clients while collaborating closely with MakeMyTrip’s corporate travel services team.
Strategic Implications
- Benefits for MakeMyTrip:
The acquisition of Happay enables MakeMyTrip to offer an integrated travel and expense management solution, enhancing its value proposition for corporate clients. By incorporating Happay’s advanced expense management capabilities, MakeMyTrip can streamline the end-to-end travel process, from booking to expense reporting, thereby improving efficiency and user experience for business travellers.
- Advantages for Happay:
Joining forces with MakeMyTrip provides Happay with access to a broader customer base and the opportunity to scale its operations. Leveraging MakeMyTrip’s extensive market presence and technological infrastructure, Happay can enhance its service offerings and reach a wider audience, solidifying its position in the expense management sector.
- Impact on CRED:
For CRED, divesting Happay allows the company to refocus on its core consumer-centric financial services. This strategic move enables CRED to allocate resources more effectively towards its primary offerings, such as credit card bill payments and personal financial management tools, thereby strengthening its market position in the fintech industry.
Industry Context
The corporate travel and expense management industry has been undergoing significant transformation, driven by technological advancements and evolving business needs. Companies are increasingly seeking integrated solutions that offer seamless travel booking and expense tracking to enhance operational efficiency and cost control.
In this competitive landscape, MakeMyTrip’s acquisition of Happay positions it advantageously against other players offering similar integrated services. By combining travel booking and expense management into a unified platform, MakeMyTrip can cater to the growing demand for comprehensive corporate travel solutions, potentially capturing a larger share of the market.
Future Prospects
The integration of Happay’s expense management platform with MakeMyTrip’s corporate travel services is expected to yield significant synergies. Clients can anticipate a more cohesive experience, with streamlined processes for booking, expense reporting, and reimbursement, leading to increased satisfaction and loyalty.
However, challenges such as system integration, data migration, and aligning organizational cultures may arise during the integration process. Addressing these challenges promptly will be crucial to realizing the full potential of the acquisition.
In the long term, this strategic move is poised to influence corporate clients’ travel and expense processes positively. By offering a unified platform, MakeMyTrip can simplify travel management for businesses, reduce administrative burdens, and provide valuable insights through data analytics, thereby enhancing decision-making and cost management.
