Why Intuit is buying Credit Karma for $7 billion - Business Insider

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Intuit is nearing a $7 billion deal to acquire Credit Karma — here's what the TurboTax owner has to gain from the buzzy startup known for its free credit scores

Credit Karma declined our request to confirm the deal. Intuit did not respond to our request for comment.Since founding the company in 2007, Lin has stressed the importance of keeping Credit Karma's products free for consumers, and that remains the case across all its products, including tax filing, which was launched in 2016.

Analyzing both credit data and income data from tax filings, Credit Karma can recommend financial products like personal loans and credit cards to its users. It earns a commission from banks and lenders if a user gets approved for a recommended product.

"Our initial investor conversations have been skeptical though on the basis of potential antitrust scrutiny on the tax side, general lack of business model synergy understanding and fears about cannibalization and execution risk," Zukin said. "We appreciate Intuit's pursuit of growing its consumer finance platform and view the proposed addition of Credit Karma a logical strategic expansion," Oppenheimer analyst Scott Schneeberger said in a statement.

 

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