topic Re: Intuit Nears Deal to Buy Credit Karma in Credit in the News

Intuit Nears Deal to Buy Credit Karma

DaveInAZ — Sun, 23 Feb 2020 19:27:09 GMT

The Wall St. Journal is reporting that Intuit is close to announcing the purchase of Credit Karma for $7 Billion in cash & stock, announcement expected as early as Monday. I'm linking to the Bloomberg article as the WSJ is usually behind a paywall.

Intuit Inc. is close to buying Credit Karma Inc. for about $7 billion in cash and stock deal, the Wall Street Journal reported, citing people familiar with the matter it didn’t identify. The purchase, which could be announced by Monday, will push the maker of TurboTax deeper into the consumer finance space, the newspaper said. The acquisition would also be Intuit’s largest in its 37-year history.

The article mentions that tax return companies "face headwinds" for the revenue because more people use free filing services and fewer people need assistance for filing their taxes. Along these lines there's a class action lawsuit against Intuit's TurboTax for "hiding" or making it difficult to find it's free filing service. When I looked into that I read that the only reason companies like TurboTax offer free filing was the IRS was planning to develop it's own free online filing service, so they agreed to offer free basic filing to prevent that. I've used free TurboTax online for several years as I have a very basic return as semi retired with only Social Security and part-time employment income and standard decution. But even then in doing my taxes it's at least half a dozen times I have to click "No, I don't want to upgrade to your $40 premium service".

Credit Karma is currently privately held by it's founders and private equity firms. Nice payday for them!

Re: Intuit Nears Deal to Buy Credit Karma

Anonymous — Sun, 23 Feb 2020 19:46:43 GMT

Thanks for sharing!

Re: Intuit Nears Deal to Buy Credit Karma

Remedios — Sun, 23 Feb 2020 20:18:48 GMT

Oh great "We think you're prequalified for $1,000,000.00 refund"

Re: Intuit Nears Deal to Buy Credit Karma

Anonymous — Sun, 23 Feb 2020 20:28:37 GMT

Interesting. Thanks for sharing

Re: Intuit Nears Deal to Buy Credit Karma

Anonymous — Sun, 23 Feb 2020 20:30:57 GMT

Great... I stopped using Mint after my BK because I didn't want Intuit to have access to my financial life outside of TurboTax and now they'll be able to see my credit history too.

I guess I might as well start using Mint since they're going to have all the info I don't want them to have anyway.

@DaveInAZ there are two TurboTax free services. The "free" one that tries to upsell you that they have had as long as they have had online software which is basically only good for 1040-EZ and the truly free one that allows full access to their software for those who make less than $36K AGI. If you search "IRS free file" it will take you to the IRS website that lists all those programs, some of them with higher AGI limits (IRS cap is $69K AGI) than TurboTax too. I used the IRS free file version this year and it was cake without the usual attempts to get me to buy.

Re: Intuit Nears Deal to Buy Credit Karma

DaveInAZ — Mon, 24 Feb 2020 14:46:43 GMT

@Anonymous wrote:
Great... I stopped using Mint after my BK because I didn't want Intuit to have access to my financial life outside of TurboTax and now they'll be able to see my credit history too.

I guess I might as well start using Mint since they're going to have all the info I don't want them to have anyway.

@DaveInAZ there are two TurboTax free services. The "free" one that tries to upsell you that they have had as long as they have had online software which is basically only good for 1040-EZ and the truly free one that allows full access to their software for those who make less than $36K AGI. If you search "IRS free file" it will take you to the IRS website that lists all those programs, some of them with higher AGI limits (IRS cap is $69K AGI) than TurboTax too. I used the IRS free file version this year and it was cake without the usual attempts to get me to buy.

Ah, thanks a bunch for that! The other thing is the "free" TurboTax that tries to upsell you is that it limits you to $1500 in interest, over that amount requires another IRS form to list all interest payees separately and TurboTax absolutely requires you to pay for the premium service for that. When you regularly do bank account SUBs it's not hard to hit $1500 in 1099-INTs.

And I've avoided Credit Karma's free tax service because I don't want them to have all my income/tax info in addition to all the credit info they have on me. And that's why CK offers the free tax service, to "better match" you with credit offers by also having your income info. CK already uses some wage reporting service that some employer use (I forget the name) to snag your income info, I checked and my local county government employer doesn't use it. If this deal goes through I'm thinking I'll keep CK but start using a non-Intuit tax service.

Re: Intuit Nears Deal to Buy Credit Karma

Anonymous — Mon, 24 Feb 2020 15:18:53 GMT

@DaveInAZ wrote:
@Anonymous wrote:
Great... I stopped using Mint after my BK because I didn't want Intuit to have access to my financial life outside of TurboTax and now they'll be able to see my credit history too.

I guess I might as well start using Mint since they're going to have all the info I don't want them to have anyway.

@DaveInAZ there are two TurboTax free services. The "free" one that tries to upsell you that they have had as long as they have had online software which is basically only good for 1040-EZ and the truly free one that allows full access to their software for those who make less than $36K AGI. If you search "IRS free file" it will take you to the IRS website that lists all those programs, some of them with higher AGI limits (IRS cap is $69K AGI) than TurboTax too. I used the IRS free file version this year and it was cake without the usual attempts to get me to buy.
Ah, thanks a bunch for that! The other thing is the "free" TurboTax that tries to upsell you is that it limits you to $1500 in interest, over that amount requires another IRS form to list all interest payees separately and TurboTax absolutely requires you to pay for the premium service for that. When you regularly do bank account SUBs it's not hard to hit $1500 in 1099-INTs.

And I've avoided Credit Karma's free tax service because I don't want them to have all my income/tax info in addition to all the credit info they have on me. And that's why CK offers the free tax service, to "better match" you with credit offers by also having your income info. CK already uses some wage reporting service that some employer use (I forget the name) to snag your income info, I checked and my local county government employer doesn't use it. If this deal goes through I'm thinking I'll keep CK but start using a non-Intuit tax service.

Since you can't actually opt out of being soft pulled, I'll probably do the same. It's a shame because I like TurboTax. I haven't used anything else as far back as I can remember.

Re: Intuit Nears Deal to Buy Credit Karma

SouthJamaica — Mon, 24 Feb 2020 21:39:34 GMT

What I'm trying to figure out is what about Credit Karma makes it worth $7B?

Re: Intuit Nears Deal to Buy Credit Karma

Remedios — Mon, 24 Feb 2020 22:29:01 GMT

@SouthJamaica wrote:
What I'm trying to figure out is what about Credit Karma makes it worth $7B?

Peddling cards and other products to those who dont know any better is a very lucrative business.

Re: Intuit Nears Deal to Buy Credit Karma

NimbusIII — Mon, 24 Feb 2020 23:00:23 GMT

No longer near! Done deal!

https://www.google.com/url?sa=t&source=web&rct=j&url=https://news.crunchbase.com/news/as-intuit-eyes-credit-karma-for-7b-a-quick-look-back-at-its-funding-history/&ved=0ahUKEwiH8rXWpOvnAhUPJDQIHeUNDjMQxfQBCCgwAA&usg=AOvVaw0MSbqApD5t1Ym9mpyi7-yE

Re: Intuit Nears Deal to Buy Credit Karma

Anonymous — Tue, 25 Feb 2020 17:01:23 GMT

Wow, I think I'm speachless. It's interesting that a company that offers free services could be worth so much, I'd probably sell too if I was the founder! After all it tends to happen all the time with these startups.

I just wonder what kind of changes will take place.

Re: Intuit Nears Deal to Buy Credit Karma

Revelate — Wed, 26 Feb 2020 15:28:03 GMT

@Anonymous wrote:
Wow, I think I'm speachless. It's interesting that a company that offers free services could be worth so much, I'd probably sell too if I was the founder! After all it tends to happen all the time with these startups.

I just wonder what kind of changes will take place.

Google would be the obvious example of free services (supported by advertising) and their valuation dwarfs this one.

Credit Karma is astonishingly successful when I think about it; there were years where in the UFS board something like 98% of the people who found it had gotten their scores from CK... and I've even been a strong proponent that for everything other than scores CK is best in class.

Saw a quick bit on Bloomberg about the combination: did strike me as cash grab and I expect to see a hard line set between CK and TurboTax offerings.

We'll see but I have a hard time seeing where this will be good for consumers.

Re: Intuit Nears Deal to Buy Credit Karma

Anonymous — Wed, 26 Feb 2020 17:47:29 GMT

@Revelate wrote:
@Anonymous wrote:
Wow, I think I'm speachless. It's interesting that a company that offers free services could be worth so much, I'd probably sell too if I was the founder! After all it tends to happen all the time with these startups.

I just wonder what kind of changes will take place.
Google would be the obvious example of free services (supported by advertising) and their valuation dwarfs this one.

Well, Google is definitely a bit more useful than CK.

Intuit buys Credit Karma 7.1 Billion

FireMedic1 — Sun, 26 Apr 2020 20:27:27 GMT

So the beta updates a sign? More intfo when you Google. Dont want to post political stuff.

"Credit Karma/Intuit: In February 2020, Intuit announced that it would acquire Credit Karma, with a closing reported as likely to occur in the second half of 2020. A mature and successful fintech, Credit Karma was founded in 2007, employs approximately 1,300 employees and reported approximately $1 billion in unaudited revenue for 2019 (up 20% year-over-year). Total consideration for the transaction equals approximately $7.1 billion (subject to adjustment) with approximately 50% Intuit stock and 50% cash. Demonstrating the importance of human capital to fintech businesses, total consideration included approximately $1 billion of equity awards, with an additional $300 million of retention equity to be granted to Credit Karma employees upon closing. Through this acquisition, Intuit will acquire Credit Karma’s sizable customer base and suite of products. For example, Intuit will benefit by purchasing Credit Karma’s tax preparation services business and consolidating it with its own TurboTax.4 The acquisition of Credit Karma’s products also allows Intuit to significantly increase the number and depth of interconnected products it offers with a view to address all of its customers’ financial needs in one platform"

https://investors.intuit.com/news/news-details/2020/Intuit-to-Acquire-Credit-Karma/default.aspx

So it got moved. Went back 2 pages looking. Guess I gotta do more. Sorry...........

Re: Intuit buys Credit Karma 7.1 Billion

Anonymous — Wed, 29 Apr 2020 00:55:57 GMT

They collected all our info and sold it.

First year that i used CreditKrsma tax return. (It was very confusing, for just 1040 and 1099. However, i decided to give it it a try, rather than pay HRblock or Turbotax, or local advisor who charge 120 to copypasta W2 form.)

By the looks of it, it will be the end of credit karma tax service.

Intuit will kill it, or make very unusable.

Re: Intuit Nears Deal to Buy Credit Karma

sarge12 — Wed, 29 Apr 2020 01:04:55 GMT

@DaveInAZ wrote:
The Wall St. Journal is reporting that Intuit is close to announcing the purchase of Credit Karma for $7 Billion in cash & stock, announcement expected as early as Monday. I'm linking to the Bloomberg article as the WSJ is usually behind a paywall.

Intuit Inc. is close to buying Credit Karma Inc. for about $7 billion in cash and stock deal, the Wall Street Journal reported, citing people familiar with the matter it didn’t identify. The purchase, which could be announced by Monday, will push the maker of TurboTax deeper into the consumer finance space, the newspaper said. The acquisition would also be Intuit’s largest in its 37-year history.

The article mentions that tax return companies "face headwinds" for the revenue because more people use free filing services and fewer people need assistance for filing their taxes. Along these lines there's a class action lawsuit against Intuit's TurboTax for "hiding" or making it difficult to find it's free filing service. When I looked into that I read that the only reason companies like TurboTax offer free filing was the IRS was planning to develop it's own free online filing service, so they agreed to offer free basic filing to prevent that. I've used free TurboTax online for several years as I have a very basic return as semi retired with only Social Security and part-time employment income and standard decution. But even then in doing my taxes it's at least half a dozen times I have to click "No, I don't want to upgrade to your $40 premium service".

Credit Karma is currently privately held by it's founders and private equity firms. Nice payday for them!

7 billion dollars for Creditkarma? Are you sure? I would have been shocked to learn they gave 7 million for Creditkarma, would have thought fair market value to be closer to 7 thousand dollars, and I might have been a player at 7 dollars if I have it to spare. Guess I was wrong about CreditKarma being worthless...nah, it is worthless to me.

Re: Intuit Nears Deal to Buy Credit Karma

MrZero — Mon, 04 May 2020 08:27:51 GMT

@sarge12 wrote:
@DaveInAZ wrote:
The Wall St. Journal is reporting that Intuit is close to announcing the purchase of Credit Karma for $7 Billion in cash & stock, announcement expected as early as Monday. I'm linking to the Bloomberg article as the WSJ is usually behind a paywall.

Intuit Inc. is close to buying Credit Karma Inc. for about $7 billion in cash and stock deal, the Wall Street Journal reported, citing people familiar with the matter it didn’t identify. The purchase, which could be announced by Monday, will push the maker of TurboTax deeper into the consumer finance space, the newspaper said. The acquisition would also be Intuit’s largest in its 37-year history.

The article mentions that tax return companies "face headwinds" for the revenue because more people use free filing services and fewer people need assistance for filing their taxes. Along these lines there's a class action lawsuit against Intuit's TurboTax for "hiding" or making it difficult to find it's free filing service. When I looked into that I read that the only reason companies like TurboTax offer free filing was the IRS was planning to develop it's own free online filing service, so they agreed to offer free basic filing to prevent that. I've used free TurboTax online for several years as I have a very basic return as semi retired with only Social Security and part-time employment income and standard decution. But even then in doing my taxes it's at least half a dozen times I have to click "No, I don't want to upgrade to your $40 premium service".

Credit Karma is currently privately held by it's founders and private equity firms. Nice payday for them!
7 billion dollars for Creditkarma? Are you sure? I would have been shocked to learn they gave 7 million for Creditkarma, would have thought fair market value to be closer to 7 thousand dollars, and I might have been a player at 7 dollars if I have it to spare. Guess I was wrong about CreditKarma being worthless...nah, it is worthless to me.

You might not, but the data they've accumulated over the years and other stuff, including whatever underlying techonologies CK owns is worth probably worth it for the same reason Facebook is worth so much (okay there's other reasons there these days) despite our individual personal data on its own being worth only a few dollars each. Intuit also probably didn't like CK's free state tax filing either and they've eliminated a competitor that was taking business away from them.