Ridicule To Revolution: Three founders reflect on the big shift in perception about Indian startups
Zetwerk’s co-founder and CEO Amrit Acharya also recounted being ridiculed for his startup’s “un-sexy” idea of offering contract manufacturing in India. There is now an appreciation for startups that are solving uniquely Indian problems, according to Acharya.
The comments come amid continuing criticism of startups—particularly unicorns—over their financial unsustainability, lack of profitability and long journeys to public markets.
Wipro’s executive chairman Rishad Premji in an earlier panel called the unicorn craze “overhyped” and emphasized the need for sustainable growth and long-term value creation, rather than being fixated on valuations.
Responding to the criticism, Peak XV Partners’ Rajan Anandan, who was moderating the startup panel, said, “My friend Rishad Premji doesn’t like unicorns. But, that’s okay…”
Anandan highlighted the surge in the number of billion-dollar privately-valued companies—from zero pre-2011 to over 100 unicorns in 2024—and put the spotlight on startups growing at an unprecedented pace, some even advancing from inception to IPO within seven years.
The six-year-old Zetwerk posted nearly ₹12,000 crore revenue in FY23 with a third of it coming from the US. The Peak XV-backed unicorn is likely to go for an IPO in 2025 or 2026, Acharya confirmed during the panel discussion.
“Pre-2019, only five venture-funded Indian startups had gone public. Today, that number is over 30 with a combined market capitalisation of over $100 billion. So, clearly everything has changed,” said Anandan, underlining the surge of Zomato to over $25 billion in market cap.
Commenting on the big shift from the “growth at all costs” model within the startup ecosystem, Unicommerce Managing Director and CEO Kapil Makhija said, “It is an era of sustainable growth, where founders are conscious of building unit economics and path to profitability.”
Highlighting Unicommerce’s successful IPO earlier this year as India’s second most-subscribed public market issue in 2024, Makhija said, “What investors liked in our story was we were growing consistently with stable financials. We were profitable for many years and that was appreciated.”
2024 is set to become the best year for new-age tech IPOs since 2021, when Zomato, Paytm, Nykaa, PB Fintech and Delhivery, among other, raced to Dalal Street as the flagbearers.
So far this year, we have seen the likes of Ola Electric, FirstCry, Digital, Ixigo, Unicommerce, Awfis and Swiggy starting their public market journeys. More are likely to follow with MobiKwik, BlackBuck, Ecom Express and others set to get the fireworks going with plans to list in late 2024 or early 2025.
Swiggy’s IPO displayed the possibility of startup value and wealth creation, with the food and grocery delivery giant’s public issue unlocking ₹9,000 crore in ESOPs for as many as 5,000 of its employees.
“While we see all these startups listing, one unique thing is: for the first time, we are seeing wealth sharing happening at this scale. We last saw it with Infosys,” said Shah.
“For the first time, we are moving away from paying salaries and saying be happy. That’s going to create a new wave. I am seeing a lot of people from startups joining these big companies, but I am seeing a wave of top executives moving to this side because they have tasted the blood of ESOPs.”
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