Strategy question

Why did IntuIt acquire credit Karma?

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What this question tests

Understanding of strategic acquisition rationale, connecting a real deal to underlying business logic.

How to approach it

  1. State the core rationale, Intuit acquired Credit Karma primarily to gain its large user base and distribution reach for cross-selling TurboTax and other financial products.
  2. Explain the complementary asset, Credit Karma's free credit monitoring product attracts a broad, habitual user base that TurboTax's seasonal usage does not naturally build.
  3. Explain the data advantage, Credit Karma's financial profile data on users could inform more personalized product recommendations across Intuit's suite.
  4. Explain the strategic shift, moving Intuit from a seasonal tax-time relationship to a year-round financial platform relationship with users.
  5. Note the regulatory scrutiny the deal faced, since combining large financial data sets raised antitrust concerns before approval.
  6. Close with the implied business outcome, cross-sell revenue growth and increased user engagement frequency across Intuit's platform.

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