The year so far has been no less than a nightmare for gaming players in India. This is because the online gaming industry faced numerous challenges due to the increased regulatory scrutiny and a tightened tax noose on the real money gaming (RMG) segment.

While the Ministry of Electronics and Information Technology (MeitY) provided some clarity by notifying online gaming rules in the first half of the year, the sector was shaken when the GST council mandated a 28% GST.

The move even prompted gaming-focussed VC firm Lumikai to revise its gaming revenue projection for FY28 to $7.5 Bn from $8.6 Bn.

Amid regulatory challenges and taxation impacts faced by RMG firms, funding in the gaming space declined significantly from $576 Mn in 2022 to $209 Mn in 2023 until November, Inc42 data showed.

However, not everything is gloom and doom, even as the overall sentiment for RMG appears subdued.

Well, from predictions point of view, the year 2024 is anticipated to witness springtime for mid-core and casual gaming studios. Investors will be seen tilting towards these segments amid expectations of them becoming the primary growth drivers for gaming revenue in India next year.

Even though there are hopes of a stable 2024 on the horizon, investors are expected to remain cautious while approaching the sector. This caution will likely hurt gaming segments that are sulking due to the government’s tightened GST noose.

With precisely ten days remaining in 2023, let’s understand how experts see this industry going through a shift and the key predictions that will define the Indian online gaming sector in 2024.

Here Are The 8 Online Gaming Predictions For 2024

No Relief On Cards For RMG Players

As of now, industry experts fear that gaming startups may continue to bear the extra GST cost for the next 1-2 years to retain customers, affecting their topline by about 70-80%. Further, smaller startups with limited funds may face challenges in absorbing the extra costs and could be forced to shut down. Although many smaller RMG startups are considering consolidation, larger startups are presently not showing any interest in acquiring companies within the same segment.

“The tax structure will undoubtedly impact the profitability of RMG companies. Larger VC-funded startups are using their cash reserves to absorb these additional costs. No investments were made in RMG companies during the second half of the year, and I anticipate that new investments are not likely to come in either. It’s just a matter of time that larger startups begin to feel the impact as well,” Sudhir Kamath, chief operating officer of Nazara Technologies, said.

To survive in the current stressful situation, the RMG startups are looking at optimising costs, which will likely have an impact on their innovation in the upcoming year, Kamath added.

Meanwhile, according to a senior executive at an Indian gaming unicorn, larger startups are trying to push diversification such as introducing free-to-play games. However, none of these companies have been able to make significant developments yet.

For instance, Dream Game Studios, owned by Dream11 parent Dream Sports, launched its first mobile game in India and Pakistan in October. Moreover, these companies are also looking to decrease reliance on the Indian market and looking at international expansion. Recently, MPL said its revenue from international operations accounted for 38% of its operating revenue in FY23, up from 11% in FY22.

Casual & Mid-Core Gaming To Change The Game

At a time when investors are shying away from investing in the RMG segment, there is a growing interest in casual and mid-core gaming in India.

Casual games are a category of video games intended for a wide and diverse audience. They are designed to be easily accessible, user-friendly, and enjoyable for players of all skill levels. Some examples of casual games are Candy Crush, Clash of Clans, and puzzle games.

Meanwhile, mid-core games, somewhere between casual and hardcore genres, demand a higher level of player engagement with more complex mechanics and elements, requiring a dedicated time commitment. Free Fire and BGMI are two of the many examples.

While, on the one hand, the return of BGMI (Battlegrounds Mobile India) has reignited advertising interest in the gaming space, in-app purchases for casual games are experiencing growth on the other.

Players are increasingly willing to make in-app purchases for features like skipping wait times, advancing levels, and accelerating progression.

The ease and convenience introduced by UPI have played a significant role in making users more comfortable with in-game transactions.

“I am very bullish on both video gaming and esports. There’s better monetisation potential. We have seen that gamers are now more comfortable paying for in-app purchases and are gradually moving towards big-ticket purchases, thanks to UPI,” Nazara’s Kamath said.

Meanwhile, Ashwin Suresh, the founder of game streaming startup Loco has observed a noticeable willingness to experiment with new genres among gamers.

According to him, until the middle of last year, there was a strong inclination mostly towards shooter games and the battle royale format. “However, as we progressed into the year, we observed a significant uptake in the PC format and a surge in role-playing games and massively multiplayer online games,” Suresh said.

Imperative to mention that the gaming sector is undergoing a demographic shift as well, particularly with the increasing presence of gamers from non-metro cities and towns. Within this demographic, 60% are male and the remaining are female gamers.

Lately, Nazara Technologies is seen focussing on bringing out new games. For this, the listed gaming giant has partnered with four Indian game studios to publish five casual and mid-core games in India.

On an earlier occasion, CEO Nitish Mittersain told Inc42 that Nazara was looking to invest in gaming studios capable of producing top-tier games tailored for both the Indian and global markets.

User Engagement, Retention Rate To Attract Investments

Moving on, according to industry experts, gaming studios can expect to secure anywhere between $3 Mn and $7 Mn from VCs next year.

In the casual gaming segment, investors will likely focus on metrics such as engagement, retention rate, and time spent as they evaluate potential investment opportunities.

Talking about Lumikai’s investment thesis, Salone Sehgal, the general partner of the VC firm said, “We invest in pre-product studios with a focus quality of the team, their previous experience, and the 0-1 scale of their gaming journey. For the studios that have launched one or few games, we focus on engagement, early retention metrics at D-1, D-20, and D-30, along with the time spent on the platform. We also conduct thorough product checks and competitive benchmarking as part of their evaluation process.”

Meanwhile, early stage VC WEH Ventures plans to shift focus from pre-game studios to those that have already launched 2-3 games.

According to Rohit Krishna, partner, WEH Ventures, the overall progress in AI has significantly simplified and made content creation more affordable. Moreover, the availability of new tools will play a crucial role in game development. While many studios have been experimenting this year, they will be seen launching more games next year.

Investors To Remain Cautiously Optimistic About AAA Games

At a time when the future of casual and mid-core gaming studios appears to be bright, investor interest is a bit dim towards AAA gaming. This is because the Indian gaming market predominantly follows a freemium model, and there hasn’t been a significant evolution towards paid-premium games yet. Moreover, Indian studios have not yet successfully developed AAA games.

However, things could change for good as two or three AAA games are scheduled for launch next year. This development is likely to capture the attention of investors and potentially make them more eager to invest in AAA gaming studios.

But, it’s still early days for AAA and console game development in the Indian market as startups are yet to reach that stage of maturity that is needed for this space.

Talking about the maturity in the space, game development startups are taking charge of nurturing next-generation talent. However, this will not be enough for sustainable growth, as these players will have to solve the challenge of high operational costs to subdue the impact of the 28% GST whiplash on the industry.

The post 8 Online Gaming Predictions For 2024 appeared first on Inc42 Media.

What’s a newsmaker in the context of startups and tech? Is it an outspoken founder or investor who was among the headlines over allegations and controversies, or is it someone who creates phenomena with their statements and thoughts?

Over the past month, we have recounted the personalities that found themselves among controversies and success stories of the year — from public listings to startups that turned profitable and from founder exits to shutdowns in the Indian startup ecosystem, While these were some of the bigger stories of 2023, we believe newsmakers are those who drove themes and trends that remained prominent throughout the year.

There were founders and leaders who earned prominence for other reasons too, such as Zomato CEO Deepinder Goyal or Paytm founder and CEO Vijay Shekhar Sharma for turning around their large businesses to some extent.

Or even founders of Honasa (Mamaearth), Zaggle, ideaForge and others that successfully navigated public markets for public listings. Plus, major VC ecosystem developments such as Omidyar Network’s exit from India or Peak XV Partners rebranding from Sequoia Capital also garnered plenty of attention.

But in our recap, we have chosen eight newsmakers who had a more profound influence on Indian tech. As part of Inc42’s 2023 In Review series, we are looking at these founders, CEOs and tech leaders who shaped the discourse and sparked off debates this year.

From Ola Electric founder Bhavish Aggarwal who launched a new company this year to join the generative AI revolution to Tim Cook, who turned into something of a global ambassador for the Make-In-India movement. And from Isha Ambani carrying the torch forward for Reliance’s retail legacy, to Narayana Murthy’s comments that stirred up the work-life balance debate all over again — these are the personalities that drove conversations throughout 2023.

Bhavish Aggarwal: Dominating EVs & Eyeing Generative AI

Last year, the Ola Electric founder found himself in the thick of social media disputes with competitors in the automobile industry, but this year, Aggarwal’s focus turned to pumping up Ola Electric’s two-wheeler sales figures and announcing the launch of the next generation of EV two-wheelers by the end of 2024. There are also plans for an electric car in 2025.

With Aggarwal leading the marketing push on his personal social media channels, Ola’s EV business has seen tremendous growth — nearly 50% higher monthly sales in November 2023 as compared to September 2023.

And with Ola’s growth, the overall adoption for EV two-wheelers has also picked up for other players — sales nearly doubled in November as compared to June 2023.

The Aggarwal-led company also put its IPO plans into full throttle by converting into a public company, after raising INR 3,200 Cr in a year when mega rounds were a rare occurrence. The pre-IPO filings are expected to come in December and there will be a lot of eyes on what Ola and Aggarwal expect from the public markets.

And while most of the focus has been on Ola Electric, Ola Cabs also introduced plenty of changes from ONDC integration to the Ola Prime Plus tier. But Ola Electric is clearly the biggest motivation for Aggarwal currently.

Of course, towards the end of the year, some of his focus turned to generative AI. At a time when the global gen AI fight seems to be centred around big tech giants, Aggarwal’s third venture Krutrim is looking to disrupt the space with an AI-centric cloud infrastructure, developing AI models for Indian languages and more.

Here’s a deep dive into Krutrim’s plans, and what we are more interested in seeing is whether Aggarwal changes the game in AI just as Ola did for EVs and mobility.

Isha Ambani: Revamping Reliance’s Retail Legacy

Reliance is one of the biggest newsmakers in tech every year for everything that Reliance Jio does, but this time around it’s the retail business that has taken centre stage with Isha Ambani leading the line.

Last year, Isha was elevated to chairman and managing director of Reliance Retail and the company’s moves this year signal a change towards digital-first brands, tech-driven platforms and a new-age omnichannel approach.

This year, the retail major forayed into the BPC market with Tira, and Reliance Retail’s digital and new commerce revenue surged to INR 50,000 Cr in FY23, a fifth of the overall revenue. Reliance Retail also raised over INR 15,000 Cr (nearly $2 Bn) from sovereign funds to press the accelerator on the digital commerce businesses, and acquire brands or exclusive rights to international labels.

While Mukesh Ambani and Akash Ambani helm Reliance Industries and Reliance Jio, Isha’s focus has squarely been on Tira and AJIO (fashion), along with JioMart. The revenue contribution just shows how key these platforms will be for long-term growth for Reliance’s retail business.

But that’s not all — the newly-created Jio Financial Services (JFS) has brought Isha on board as a director, and with JFS’ plans to increase credit penetration in the retail market, we could see some interesting developments between Reliance Retail and JFS in the year ahead.

Narayana Murthy: Wading Into The Work-Life Balance Debate

Narayana Murthy is no stranger to being among the headlines, but this year, the Infosys cofounder and former CEO jumped into a hot debate that has polarised the tech ecosystem.

The Padma Shri awardee argued that work productivity in India is one of the lowest in the world and urged youngsters to volunteer to work 70 hours a week. But this caused a lot of furore among certain sections of those who follow Murthy, even as many other entrepreneurs advocated for the same.

To be fair, the work-life balance debate has been a hot topic of discussion pretty much every year. In 2022, Bombay Shaving Company founder Shantanu Deshpande urged startup employees to put in 18 hours every day, which raised concerns about the pressures of working in a startup, work culture and employee happiness.

But Murthy’s comments have been particularly criticised as he cited his own experience with founding Infosys and working long hours as an example. Many pointed out that given his ownership of the company, his motivation was not unnatural, but most entry-level employees have personal goals and commitments that do not justify long working hours. Others also pointed out the low salaries paid by IT giants such as Infosys to entry-level and mid-tier talent.

Besides this Murthy was caught in a deepfake campaign where a video featuring his likeness and voice was used to promote a stock trading platform. The veteran entrepreneur was one of several celebrities seen in AI-generated fake videos this year.

But it doesn’t end there: Murthy also took a stance against government subsidies for infrastructure, saying “nothing should be given for free”. He is believed to have suggested that those availing government subsidies should be made to contribute back to the betterment of society in some form or the other.

His comments, made at the Bengaluru Tech Summit 2023 in December, are particularly ironic given that so much of Indian tech today revolves around digital public infrastructure, which is essentially a free service for users, subsidised by government and policy push.

Rahul Yadav: Return Of The ‘Bad-Boy’ Entrepreneur

While Ashneer Grover continues to cause controversies with each statement, the biggest founder-related governance issues this year have come from Broker Network and its founder Rahul Yadav.

As we recounted in our original and deep investigation into Yadav’s latest venture, Broker Network burnt over INR 280 Cr in less than 18 months, and the founder is alleged to have built a web to syphon off funds from the company.

The biggest surprise with Broker Network is that Info Edge invested INR 280 Cr in the company after being convinced by Yadav that the Housing.com ouster and the Intelligent Interfaces’ no-show are behind him.

Essentially, even one of the most experienced investors in India — led by Sanjeev Bikhchandani, one of the most reputed entrepreneurs in the country — was swayed by a pitch, which eventually turned out too good to be true. Investors have tightened up their due diligence processes for potential investments a lot in the past two years and Info Edge’s bruising experience is only likely to increase their scrutiny into founders and potential bets.

Today, Yadav is dealing with multiple cases. The Economic Offences Wing has registered an FIR against him and is looking into the bigger complaint by Info Edge. Even former employees have filed FIRs against Yadav for furnishing bad cheques. Will 2024 see Yadav being prosecuted and charged for the Broker Network saga?

Rajeev Chandrasekhar: Cementing India’s Place In Global Tech 

Few policymakers and legislators in India wade into tech debates as frequently as Rajeev Chandrasekhar, who as Minister of State (MoS) for Information Technology, is second in command after Ashwini Vaishnaw, the union minister for IT.

But Chandrasekhar has been nearly omnipresent when it comes to speaking about the government’s stand on everything from AI regulations in light of the generative AI revolution, or net neutrality given the battle between telcos and over-the-top (OTT) service providers over network fees.

As per reports, Chandrasekhar, during a meeting with his Dutch counterpart Alexandra van Huffelen, is said to have pushed for a greater role for India in swiftly putting in place global regulations for emerging tech.

The MoS for IT also pushed for greater manufacturing in India by tech giants across sectors — particularly focussing on how Apple has managed to expand its manufacturing footprint in India (more on this later). In addition to electronics manufacturing, Chandrasekhar is said to have liaised with Elon Musk-led EV giant Tesla to bring EV manufacturing to India and procure components locally.

With India looking to carve out a bigger piece of the global tech manufacturing pie in light of the China+1 movement, Chandrasekhar has emerged as the face of India’s tech policy in many ways.

Robin Raina: Eyeing An IPO For A Bankrupt Business 

There are CEOs that seem to grow into mature leaders as their companies head to the public markets, and there are the likes of Robin Raina, whose outlandishness never seems to wane.

The Ebix, Inc. and Ebix Cash CEO has had to face many tough questions in light of the company’s INR 6,000 Cr IPO plans in India, particularly related to the sorry state of its financials and its high indebtedness.

Raina joined Ebix way back in 1997 and quickly rose up the ranks, but the company’s operations have been under a cloud in the past year, especially after the Hindenburg Research report that questioned a lot of the company’s claims. Despite this, Raina has looked to stay in the limelight with his penchant for the high life — particularly, the glamour shots with his Ferrari and other luxury vehicles.

Ebix’s lenders have unsuccessfully chased the company for funds, but Raina took home a $1.8 Mn bonus in September 2023 even as the business was coming close to bankruptcy. In December 2023, Ebix Inc filed for bankruptcy in the US, after defaulting on a $617 Mn loan and several covenants associated with this debt.

The entire episode shows us the severity of corporate governance lapses in some companies, even those that aspire to raise money from public markets. And there’s also a question of how regulators approved the IPO plans for a company that has so many red flags in its leadership.

Sam Altman: The Posterboy Of Generative AI

Fired and back again in five days. Few founders and CEOs can boast of having survived such drama as Sam Altman did with OpenAI in late 2023, after being thrown out of his own company. His dismissal and subsequent reinstatement set off shock waves across the global tech ecosystem, sparking off a debate about the power struggle between a founder and a company’s board.

Altman, considered by many as the face of generative AI, has been in the news all year long — largely because generative AI itself has grabbed headlines and the attention of the world. There were reports about a DDoS attack on OpenAI in early November as well as the company’s close ties with Microsoft, its lead investor.

In the Indian context, however, controversies around Altman started much before the boardroom shenanigans at OpenAI.

Altman’s visit to India and his public appearance attracted the who’s who of the Indian tech ecosystem. But when he was asked whether Indian companies could compete with OpenAI, his answer did not please many. He called it a “totally impossible” endeavour, but later clarified that he was simply responding to a question about trying to compete with OpenAI valued at over $25 Bn+ using just $10 Mn.

Of course, all this was forgotten by the time Altman was sacked by the company’s board and then brought back swiftly, If anything, his reinstatement only seems to reinforce the notion that Altman is not only the most influential person at OpenAI, but arguably also in generative AI.

The rise of OpenAI has fuelled the generative AI revolution with a slew of startups now looking at building LLMs and models for specific needs. Case in point: Indian AI startups Bhavish Aggarwal’s Krutrim or Lightspeed-backed Sarvam AI. Plus, companies across sectors are adopting ChatGPT and generative AI en masse for their operations.

Tim Cook: Making India The Apple Of His Eye

He’s the CEO of the world’s most valuable company, and one could argue that no CEO has backed India in as big a way as Apple’s Tim Cook did this year.

In contrast to the visit of Jeff Bezos in 2020, Cook’s tour of India saw Apple launch its first own-brand retail stores in Mumbai and Delhi. But this was a relatively minor development when seen in the context of Apple’s larger plans for India.

Firstly, the tech giant expanded its manufacturing base in India and is eyeing making more than just iPhones in the country. Given the fact that accessories such as chargers and wireless earphones (Airpods) sell in larger quantities than smartphones, it could be argued that this represents the biggest push for global electronics exports from India.

Apple’s lead in India has since been followed by the likes of Google, which said it would manufacture Pixel smartphones in India from 2024.

Some of the goodwill earned by Apple has been tarnished with allegations around anti-competitive practices by its App Store, as well as the alleged hacking of iPhones of some elected officials. But these were minor blips in the Apple story.

Cook and Apple’s India plans underscore the wider China+1 movement in the tech industry, as many major players are looking to diversify their manufacturing bases away from China and to India and other geographies.

Of course, Apple being the largest company in the world by market cap, seems to dominate all discussion around the Make-In-India success story, but going forward the efforts of the company would be to boost local manufacturing of smaller electronics and components for its devices, so that it has to rely on fewer imports when assembling and making products in India.

The post 8 Newsmakers Of 2023: The People Behind The Biggest Indian Tech Stories Of The Year appeared first on Inc42 Media.

“Returns on capital in India have sucked historically.” That’s how Tiger Global partner Scott Schleifer characterised the India experience for the hedge fund giant back in February. It may sound harsh, but that’s something a lot of Indian VC firms came to terms with, in 2023. 

There’s little doubt that 2023 has been one of the toughest years for Indian startup VCs and the investor ecosystem. The past 12 months have seen partner exits, venture capital firms pulling out of India, rebranding and separation of VC structures and new fund managers coming into the picture. 

If 2022 saw startups go through instability, then 2023 was all about churn in the investor ecosystem. Sequoia Capital India’s rebranding to Peak XV Partners and separation from the US entity was the biggest story in the first half, overshadowed by the exit of Omidyar Network from India. 

Between these two big developments, a slew of partner-level departures at the likes of Orios Venture Partners, Venture Highway, Lightbox, Rebright, Lightrock India and Together Fund made it a tough year for VCs in general. 

The slowdown in investments in the past nearly 24 months and the troubles in various portfolio companies — ranging from corporate governance issues to revenue slowdown — have together created a perfect storm for VCs and fund managers. 

The headwinds have not impacted India operations alone. Sequoia US partner Michael Moritz quit the firm in July this year after 38 years, and Prosus & Naspers CEO Bob Van Dijk also stepped down from the investment major. 

And where there are departures, there are also new partners and fund managers taking over. Marquee firms such as Peak XV, Fireside Ventures, Venture Highway, Matrix Partners and Blume Ventures are some of the VC firms that named new managing directors and partners this past year. 

These new fund managers not only have to turn around the India investment story but also lead their firms into 2024 where many expect the volatile market conditions to stabilise. 

But before we get to the outlook for the next year, it’s important to look back at 2023 and understand what makes it the year of VC rejigs. 

Churn At Indian VCs In 2023

Perhaps the most noticeable trend among VC firms this year has been a slew of partner exits for reasons ranging from increasing pressure from limited partners, governance issues in portfolios, revenue and business slowdown as well as internal tensions between partners and fund managers. 

Kushal Agrawal, partner and CFO of Lightrock India resigned, marking the latest departure in a series of exits at the firm. The primary reason for Agrawal’s departure reportedly stems from internal differences regarding the operational direction of the fund.

Most recently, SoftBank India saw significant exit as India operating partner Vikas Agnihotri exited the firm. Agnihotri’s exit comes after SoftBank sold a stake in PB Fintech and Zomato, completely exiting the latter.

This is also the reason cited for the break-up at the top of Lightbox, one of the most active venture capital firms in the country. Partners Siddharth Talwar, Prashant Mehta and Jeremy Wenokur are leaving the Mumbai-based VC. 

Lightbox cofounders Talwar and Sandeep Murthy are likely to separate the fund’s portfolio and part ways due to differing views on what strategies the firm should pursue. The departing trio is looking to set up a separate fund comprising some Lightbox portfolio companies.

In the case of Orios VP, another Mumbai-based VC firm, Rajeev Suri and Anup Jain stepped away. Reports claimed the duo were unhappy with the carry-sharing arrangements. 

Both Orios and Lightbox have seen key investments falter due to market changes and competitive dynamics. 

Orios wrote off its investment in GoMechanic after the company’s well-documented revenue misreported problem. Pharmeasy, another Orios portfolio company, has seen a major devaluation in the past year and has struggled to raise new funds.

Lightbox is dealing with problems at Dunzo, one of its earliest bets. Dunzo is caught in a severe cash crunch and is unable to pay salaries to employees or vendors. Once a hyperlocal sensation, Dunzo is now looking at a bleak and uncertain future.

“Investors didn’t realise the amount of risk and liability that they are subject to because they trusted a lot of founders. And in most cases, founders were not aware and perhaps not as competent as they needed to be,” Prime Venture Partners’ managing partner Sanjay Swamy told Inc42 in July.

LP Pressure Grows On Existing Funds

The split at Orios exposed one hidden facet of the VC game. While on paper, many fund managers may be partners, their share of the carry (profits from investments) and the performance bonuses vary.

Founding partners get the bulk of the carry, while managing partners and other partners get a smaller share. Discord between these two classes of decision makers can directly increase the risk profile of the firm for any limited partner.

As we have written in the past, many limited partners were unhappy with a slew of portfolio problems at many of the biggest VC firms in India. 

LPs typically evaluate the overall fund performance, so partners whose investments have not worked out can potentially hide behind managers and partners who have led the more profitable investments. 

Another facet exposed by the problems at VC firms is the influence of limited partners (typically larger institutional investors and high net-worth individuals). The LP-fund manager relationship goes both ways. 

When raising funds, partners are more likely to approach LPs who have backed them in the past. In other cases, LPs want partners to break away and start new funds that fit the current market thesis better. 

LP pressure has increased in the past year or so as new areas of focus have emerged. The emergence of generative AI and other next-gen segments has compelled many LPs to look at funds and firms that have built their thesis around these areas. Some VC partners have completely stepped away from investing.

Brij Singh Bhasin, general partner at the early-stage venture capital firm Rebright Partners, stepped down to launch Snow Mountain AI, a generative AI-focussed startup. And if experienced VCs are not immune to the allure of new opportunities that emerged in 2023, can LPs be far behind?

“Increasingly, the startup LP network has started to recognise that emerging fund managers are some of the biggest value creators in the market,” Ankur Pahwa, founder and managing partner of PeerCapital, told Inc42 earlier this year, pointing to how many early-stage VC funds have come up in the past year.

He added that LPs want to see fund managers with very clear guardrails in terms of their stage and sector focus. No longer are limited partners swayed by momentum or opportunistic investing, which was the case in 2021 when startup funding peaked. After that peak, LPs have rationalised their expectations and streamlined their focus on VC funds as an asset class. 

New Leaders Take The Helm

If partners left firms in pursuit of new opportunities, in other cases, VC firms rejigged their leadership to fortify themselves for the new market realities. 

Several seasoned executives were promoted to partner and cofounder roles at firms such as Peak XV, Fireside Ventures, Matrix Partners and others. 

Early stage consumer-focussed Fireside Venture promoted partners Kannan Sitaram, Vinay Singh, and Dipanjan Basu to cofounder positions, while Matrix Partners India elevated principals Aakash Kumar, Pranay Desai, and Sudipto Sannigrahi to the role of MDs. 

Soon after Sequoia Capital India’s rebranding to Peak XV Partners and separation from the US firm, the firm promoted Rohit Agarwal to the position of managing director. 

Priya Mohan took over from Venture Highway founder Samir Sood and was named as the managing partner. Venture Highway is currently raising its third fund, which is being led by Mohan and cofounder Neeraj Arora.

Most recently, Orios Venture Partners appointed Sukhmani Bedi as a partner after the departure of Suri and Jain. Bedi, a three-time startup founder, has been with the firm since March 2022 and was formerly handling portfolio management at Orios. 

The Need To Evolve: VC Outlook For 2024

It is not just VC firms that are rejigging their leadership. Even private equity firms such as TVS Capital Funds prepared themselves for the new realities of the market. The Chennai-based firm appointed Naveen Unni, a former McKinsey & Co exec, as the managing partner.  

Unni’s appointment coincides with the fact that TVS is preparing to see many of its bets mature into exits by mid to late 2024. Ola Electric has filed its pre-IPO prospectus, while another TVS portfolio company Digit Insurance is also on course for a public listing in 2024. 

In an interview with Inc42 earlier this year, TVS Capital’s Gopal Srinivasan mentioned how the firm’s core focus areas have evolved over the years. He hinted at the fact that other firms also need to grow and mature with the market. 

“Everything that’s happening in India, from the public digital infrastructure to regulatory push from the RBI and IRDAI is enabling digital businesses. When people are not afraid to go digital for financial services, it creates a huge market for businesses. And, of course, urbanisation in many parts of India is creating a lot of new behaviours,” Srinivasan said at the time. 

Despite the challenges of the past year and in light of the somewhat negative sentiment of firms such as Tiger Global, there is a streak of optimism too. Many fund managers and partners have told us throughout the year that these pains are temporary. 

For instance, Surya Mantha, managing partner at Capria Ventures (formerly Unitus Ventures), believes that the momentum is with India when you look at the global macroeconomic factors affecting China and the US. 

“Several factors underpin our view that India is ready to step up: the young population, the digital public infrastructure that not only enables hundreds of millions to participate in the country’s economic life but also enables business innovation, a large and growing consumer economy as well as relatively stable macroeconomic conditions,” Mantha told Inc42 in June this year.

This view is echoed by the likes of Bejul Somaia, partner at Lightspeed Ventures, who tweeted that the India story is just beginning, as well as Naganand Doraswamy, managing partner and founder of Ideaspring Capital. 

Even though Doraswamy agreed that historic returns have not been great, he believes this is a very early stage in the India story to be counting the chickens. 

[With inputs from Nikhil Subramaniam]

The post Not Easy Being A VC In 2023: Partner Exits, Fund Splits Hurt Investors appeared first on Inc42 Media.

The year 2023 turned out to be much better for initial public offerings (IPOs) in the Indian equities market on the back of the bullish sentiment in the broader market. Despite macroeconomic headwinds and global geopolitical tensions, the domestic IPO market saw a revival this year after the lull of 2022. The public issues of new-age tech startups also saw a sharp improvement in demand in 2023 compared to a listless 2022. 

But before we delve deeper into the IPOs of new-age tech stocks, let’s take a quick look at the overall IPO landscape. 

As per the BSE data, 92 companies took the IPO route in 2023 till mid-November as against 90 companies doing so in the entire 2022. The number of IPOs further crossed the 100 mark by the beginning of December this year. Interestingly, the number of SME IPOs in 2023 was more than the mainboard public listings.

While the sluggishness of the previous year continued in the first half of 2023, the situation turned on its head in the second half of 2023.

• Data collated by IIFL Securities suggest that out of the 48 mainboard listings in the first 11 months, 39 took place between July and November. 
• Against the intended fundraising of INR 44,159 Cr across the 48 companies, the total subscription interest received across categories – qualified institutional buyers (QIBs), high net-worth individuals (HNIs) and retail investors – was to the tune of INR 14.29 Lakh Cr, as per the report by IIFL Securities.
• Tata Technologies’ public issue, the first IPO by the Tata Group in two decades, saw very high demand, receiving 70X subscriptions and bids worth INR 1.56 Lakh Cr. The other superstar IPOs of the season included Mankind Pharma, Gandhar Oil, and JSW Infrastructure. 

In the startup ecosystem, a total of five new-age tech companies – ideaForge, Mamaearth, Yatra, Zaggle, and Yudiz – went public in 2023, with one listing on the SME platform and the rest on the mainboard. 

Overall, the cumulative size of these five startups’ IPOs stood at over INR 3,600 Cr as against a little over INR 5,500 Cr in 2022 and around INR 50,000 Cr in 2021.

It is pertinent to note that the year 2021 saw 11 new-age tech startups going for IPOs amid the funding boom and buoyancy in global stock markets post the pandemic, while only three such companies went public in 2022 – Delhivery and Tracxn Technologies on the mainboard and DroneAcharya on SME platform.

Despite at least 10 startups either filing DRHPs or announcing IPO plans, they didn’t make any progress last year as the market remained tumultuous. Even this year, many of them continued to defer their IPO plans. However, experts suggest that the number of new-age tech IPOs will rise in 2024 despite the startups continuing to be cautious about the timing of going public.

8 Startup IPO Predictions For 2024

According to a recently published EY report on Q3 2023 IPO data, the surge in activity in the Indian IPO landscape is driven by strong economic activity and positive domestic and foreign investor sentiments. This momentum is expected to continue well into the 2024 second half. 

Now let’s take a deeper look at the key trends expected in the Indian new-age tech IPO market next year. 

Bull Market Effect: Rising Number Of Tech Startups To Head For IPOs In 2024

Indian markets have been touching new all-time highs post the victory of the BJP in the recently-held Assembly elections in Rajasthan, Madhya Pradesh and Chhattisgarh. The dovish commentary of the US Fed this month further aided the rally. All these factors are expected to result in an increase in the number of new-age tech startups opting for IPOs in the coming year.

Deepak Shenoy, founder and CEO of Capitalmind, said that the current market is a bull market. This will result in the success of IPOs and lead to more such public issues in the next year. According to him, the chances of a big fall in the markets in the near term seem very low, despite the ongoing geopolitical tensions, high-interest rates in the US, and other macroeconomic uncertainties. This will encourage companies to take the IPO route.

Coming to new-age tech IPOs in 2024, they can be divided into three distinct categories: 

• IPOs of companies which have already filed their draft red herring prospectus (DRHP) with SEBI;
• Companies which earlier filed their DRHPs but either withdrew or did not get listed due to uncertain market situation;
• Companies which began working aggressively on their IPO plans this year.

Navi Technologies, GoDigit, PayMate, Portea, EbixCash, and OYO, which has pre-filed its IPO papers with SEBI confidentially, are in the first category. These startups’ IPO size is cumulatively around INR 20,250 Cr. 

It is pertinent to note that following the bankruptcy filing by Nasdaq-listed Ebix, the IPO of EbixCash now seems unlikely.

There are also not-so-prominent names like Travel Boutique Online, or TBO Tek, and agri-drone company AITMC Ventures which filed their DRHPs in 2023.

Mobikwik, Capillary Technologies, ixigo, and Snapdeal fall in the second bucket. Among these tech startups, fintech unicorn Mobikwik has reportedly restarted its IPO plans. Though there is no update on the IPO timelines for the rest, these companies were looking for the market condition to improve before their listings, hence 2024 could be a potential target for them to go public.

In the third category would be Zomato’s rival Swiggy, which has started its IPO preparations and recently hired investment bankers. Prosus-owned PayU and Peak XV Partners-backed Awfis are also said to be looking to soon file their draft IPO papers, while drone startup Garuda Aerospace is eyeing a mid-2024 listing.

Besides, emobility startup Ola Electric is also working on a 2024 IPO.

Swiggy, Ola Electric To Be The Most Awaited IPOs 

Overall, at least 10 tech startups are expected to get listed next year. However, the IPOs of Swiggy and Ola Electric have already started creating buzz and would be the most watched out IPOs among the startups.

After picking a substantial share in the domestic two-wheeler EV market, Bhavish Aggarwal has decided to take Ola Electric public. 

It is pertinent to note that the IPO plans for Aggarwal’s ride-hailing business Ola Cabs have been put on hold since 2022.

Coming back to Ola Electric, while the startup has made a name for itself in the two-wheeler EV market, it continues to burn cash and is loss making. Despite this, the startup is said to be looking at a market capitalisation of $10 Bn for the IPO.

On the other hand, Swiggy’s listing will make Zomato’s biggest competitor trade on the public bourses and give another option to investors looking to bet on the food delivery and quick commerce space.

Swiggy’s IPO is being deemed the biggest IPO by an internet company next year, with an issue size of $1 Bn (INR 8,300 Cr). 

Mid-sized IPOs To Be The Theme Of The Year

Amid the slowdown in the global markets, the last two years saw an increase in the number of SME IPOs in India. While the mainboard IPOs did see a rise, the companies opted to go for smaller size for their public issues. 

Highlighting this trend, Capitalmind’s Shenoy said that while the IPO market looks brilliant right now, the demand is not high when compared to what the market witnessed in 2021.

“Technically, while we are eloquent about the current IPO situation, this is a dip in the ocean in comparison to what was earlier,” he said, adding that the size of Paytm’s IPO was much higher than many other recent IPOs combined together. 

It must be noted that Paytm’s IPO in 2021 was for over 18,000 Cr, while last year insurance company Life Insurance Company (LIC) went public with an IPO of over INR 21,000 Cr. However, both these companies saw muted listings and their share prices have remained under pressure after listing. This is also one of the reasons why companies don’t want to go for big IPOs.

Market experts believe that there is not enough investor appetite for big public issues. Hence, 2024 will mostly see companies going for more mid- and small-sized IPOs. 

Elections To Decide The Timelines Of IPOs

With India going for general elections in 2024, experts believe that a lot of companies would wait for the election results before firming up timelines of their IPOs.

According to Lightspeed MD Anuj Bhargava, while Mamaearth’s public listing and its performance after that on the bourses will encourage a lot of other companies to take the IPO route, the general elections will play a major role in deciding the timeline of these IPOs.

The likes of OYO, Swiggy, and also FirstCry are said to be looking to list on the bourses after the results of the general elections are out. 

It is also pertinent to note that Lightspeed is a major backer of IPO-bound OYO.

“Generally, people are a little bit cautious and wait for big political events to take shape. When you have something this substantial coming up, I think people normally like to wait and see the outcome before they make big decisions and IPOs are normally very big decisions… Investors also wait on the sidelines,” Bhargava said while explaining the rationale of the companies.

If the current government continues, as is the expectation and has been priced in right now, the current policies and regulations will continue. However, if a new government is to come, investors would want to see the new policies before they start investing in India, he added.

Fundamentals To Decide The Success Of IPOs

The slump in the share prices of the 11 new-age tech startups, which went public in 2021 despite most of them being loss-making, in 2022 shifted the focus on the fundamentals of companies.

For instance, Paytm, which made a muted debut on the bourses and listed at INR 1,955 on the BSE, saw its valuation nosedive nearly 68% in 2022. Similarly, Zomato, which had a market cap of over INR 1 Lakh Cr after its listing in July 2021, lost over 60% of its market value by the end of 2022.

This rout made other new-age tech companies looking to go public put their IPOs plans on hold and focus on improving their bottom lines first.

The rally in Zomato shares in 2023 on the back of it reporting back-to-back profitable quarters further highlighted how investors are looking for profitability. Like Zomato, Paytm and PB Fintech also saw a change in investor sentiment with the improvements in their bottom lines. 

“Businesses today need to have strong growth, profitability or at least a clear path to profitability… it doesn’t matter which sectors they belong to… Profitability today is the biggest ask from the public market investors,” Lightspeed’s Bhargava said.

Startups, even those not mulling to go public anytime soon, have realised what the markets want, and the last few quarters have seen them chasing profitability. Consequently, many startups also reported their first profitable months and quarters recently, although it came at the expense of mass layoffs and other restructuring efforts in many cases.

• OYO claimed to have achieved its first-ever profitable quarter in Q2 FY24, with a projected profit of INR 16 Cr. But in pursuit of turning profitable, OYO carried out multiple restructuring exercises in the last one year, and laid off around 600 employees, as per Inc42’s layoff tracker.
• ixigo also turned profitable in FY23 after a loss-making FY22. 
• Fintech unicorns MobiKwik and PayMate narrowed their net losses in FY23. Meanwhile, MobiKwik claimed to have been profitable in the first two quarters of FY24.

Speaking to Inc42 right after Mamaearth’s listing, Prashanth Tapse, research analyst, senior VP (research) at Mehta Equities, said there was no chance of more new-age, loss-making businesses entering the Indian market anytime soon.

Companies To Seek Reasonable Valuations

The listing of Nykaa, Paytm, Zomato, and a few others at staggering valuations and the subsequent wealth erosion last year has resulted in investors closely scrutinising the valuations of companies going for public listing. As a result, new-age tech companies are expected to go for reasonable valuations while pricing their shares during the IPO.

Speaking on the issue after Mamaearth’s listing, Tapse said that this is a market where companies should create value for shareholders and not for themselves.

Interestingly, there were speculations in 2022 that Mamaearth would seek a valuation of around $3 Bn for its IPO. However, the D2C unicorn put its IPO on hold amid subdued market conditions. Subsequently, it listed at a much lower valuation of $1.2 Bn in 2023. However, many experts termed even this valuation higher considering the market condition.

As such, experts believe that companies aiming to get lofty valuations will struggle in the IPO market.

Startups To Shun Overseas Listing Plans

One trend which has emerged clearly over the last few years is Indian startups looking to list on the exchanges in the country rather than going for overseas listing. 

In 2021, Freshworks listed on Nasdaq, while Yatra listed on the exchange in 2016. MakeMyTrip too made its debut on Nasdaq in 2010. 

However, this trend has seen a clear reversal. Recently, Yatra got its second listing in the Indian stock exchanges after Nasdaq. During its listing process on the Indian exchanges this year, Yatra hinted that it might take the decision to delist from the US stock market depending on several factors. 

Meanwhile, PhonePe, which has also been mulling an IPO (likely in 2025), shifted its domicile to India from Singapore. As per reports, Groww and Razorpay are also likely to shift their base to India. While the decision of the fintech companies to move to India could be guided by regulatory concerns, several other factors like lower corporate tax rate, zero taxes on capital gains, and the Indian government’s efforts to ease compliances are also said to be promoting reverse flipping and encouraging startups to list in the home country.

Besides, the Centre is also looking to make it easier for startups to list in India. Efforts are on to create a framework to offer exemptions to startups to list on the exchanges at GIFT IFSC so that they can tap global investors from India. 

Commenting on this, Bhargava said, “We would want all leading Indian companies to list in India and give domestic investors the ability to be part of their growth and value creation journey… the valuations and the investor following the tech companies will get in India are far superior to their prospects in other listing locations.”

As a result, no major Indian startups, except Zoomcar, which is eyeing a US listing through SPAC deal, are expected to go for overseas listing next year.

HNIs, Retail Investors To Drive Up IPO Subscriptions 

Data suggests that there is increasing demand for Indian IPOs from HNIs and QIBs.

As per experts, SEBI’s decision to divide the non-institutional investor (NII) category into two – INR 2-10 Lakh and INR 10 Lakh and above – has given a big boost to IPO subscriptions. 

In 2021, SEBI proposed that one-third of the HNI portion in all IPOs be reserved for investors belonging to the sub-category of INR 2-INR 10 Lakh, while the remaining part within the HNI category will be for applications of above INR 10 Lakh. The new rules came into effect from April 1, 2022.

As a result, to increase their gains, HNIs have started increasing the number of applications in both categories and are even applying in the name of their family members for IPOs, as per market watchers. 

Speaking on the matter, Mukesh Kochar, national head of wealth at AUM Capital, said that the listing of a number of recent IPOs at a steep premium to their issue price has made public issues attractive for investors looking for short-term capital gains. This trend is expected to continue next year and push up IPO subscriptions.

Here’s a table depicting the subscriptions for the new-age tech companies that went for IPOs in 2023:

Speaking on HNIs increasing their exposure in the Indian stock market, Bhargava highlighted that HNIs tend to diversify their holdings across geographies given various political and regulatory uncertainties and said that some of them are coming to India by choice and some by default.

“You see an Indian market that offers many growth opportunities. You see a very deep and liquid market, you see a stable government. You see high-quality entrepreneurs and businesses being formed… That’s when the HNIs think this is where I should put my money in next,” he added. 

On the other hand, retail investors have also started increasing their exposure to the Indian stock market. From the comfort of trading online, even on mobile phones, to an increase in the number of household brands going public (like Zomato, Paytm, Mamaearth), a number of factors have played a role in increasing the participation of retail investors in the market. 

Some experts also opined that a lot of time, retail investors get carried away by the buzz and end up applying for all IPOs rather than doing a quality or valuation check. Nonetheless, the increasing appetite of retail investors has provided a major boost to the new-age tech IPOs.

Besides direct investments, retail investors are also increasing their investments in mutual funds, which has led to higher IPO subscriptions.

“In the past, a majority of IPOs would be subscribed by foreign investors. Today, it’s the domestic institutions that subscribe to a large part of the offerings. And behind the domestic institutions are the domestic retailer investors that are putting in money via SIPs into mutual funds,” said Bhargava.

Considering the factors mentioned above, it seems that 2024 will be the year of IPOs of new-age tech startups. It will be interesting to see if 2024 turns out to be another 2021 or even better in terms of startup IPOs.

The post 8 Startup IPO Predictions For 2024 appeared first on Inc42 Media.

The investment landscape in the country is going through a shift never seen before, with more and more women founders and investors winning themselves a bigger share in the high-octane arena of the Indian startup space. 

Be it Swati Nangalia Mehra of Sixth Sense Ventures, who directly ventured into the world of investing, or the founders-turned-investors Ghazal Alagh and Vineeta Singh, many of these trailblazing women have made their mark in the homegrown startup ecosystem. This is notwithstanding other veterans such as Kiran Mazumdar Shaw and Rekha Menon who have already set examples for many in the past. 

Many of these women investors bring years of experience to the table and have today emerged as role models for the country’s youth. However, things were not the same a few years ago, the founder of She Capital Anisha Singh told Inc42.

“It was hard explaining to people that women are successful as entrepreneurs. Now that we have given mega returns to our investors, they’re excited… and understand that women are great business persons,” she added. 

As sharp as a knife, these new-age women investors have their eyes on the stars and feet on the ground, and they are charging through with great perseverance. With numerous successful exits, Indian women investors are creating templates that will be followed by many in the years to come. 

However, more importantly, women founders and investors possess something really important when it comes to building an enterprise and the world of investing.

“They will call a spade a spade and tell you things exactly as they are and not how they can be,” opines the cofounder and CFO of B2B building material marketplace OfBusiness Ruchi Kalra on what makes women great investors. 

We, at Inc42, have collated some of the names that are making waves in the startup investment world. These are the names of the women that aim to build an equitable world of tomorrow and are leaving no stone unturned in their quest.

If you are a women investor or want to nominate a women investor in the startup ecosystem, nominate us at editor@inc42.com. This is a running list, and we would love to add more women who are changing the investing landscape in the Indian startup ecosystem.

Note: This is not an exhaustive list or ranking of any kind. We have placed investors in alphabetical order. 

Here Are The 41 Women Investors Spearheading The Startup Investment Game In India

The investment landscape in the country is going through a shift never seen before with more and more women founders and investors winning themselves a bigger share in the high-octane arena of the Indian startup space.

Be it Swati Nangalia Mehra of Sixth Sense Ventures, who directly ventured into the world of investing, or the founders-turned-investors Ghazal Alagh and Vineeta Singh, many of these trailblazing women have made their mark in the homegrown startup ecosystem. This is notwithstanding other veterans such as Kiran Mazumdar Shaw and Rekha Menon who have already set examples for many in the past.

Many of these women investors bring years of experience to the table and have today emerged as role models for the country’s youth. However, things were not the same a few years ago, the founder of She Capital Anisha Singh told Inc42.

“It was hard explaining to people that women are successful as entrepreneurs. Now that we have given mega returns to our investors, they’re excited… and understand that women are great business persons,” she added.

As sharp as a knife, these new-age women investors have their eyes on the stars and feet on the ground, and they are charging through with great perseverance. With numerous successful exits, Indian women investors are creating templates that will be followed by many in the years to come.

However, more importantly, women founders and investors possess something really important when it comes to building an enterprise and the world of investing.

“They will call a spade a spade and tell you things exactly as they are and not how they can be,” opines the cofounder and CFO of B2B building material marketplace OfBusiness Ruchi Kalra on what makes women great investors.

We at Inc42, have collated some of the names that are making waves in the startup investment world. These are the names of the women who aim to build an equitable world of tomorrow and are leaving no stone unturned in their quest.

If you are a women investor or want to nominate a women investor in the startup ecosystem, nominate us at editor@inc42.com. This is a running list, and we would love to add more women who are changing the investing landscape in the Indian startup ecosystem.

Note: This is not an exhaustive list or ranking of any kind. We have placed investors in alphabetical order. 

Here Are The 41 Women Investors Spearheading The Startup Investment Game In India

1. Aarti Gupta

Aarti Gupta is the chief investment officer (CIO) of VC firm DBR Ventures. She heads the family office of DM Gupta and is the national head of the FICCI FLO Startup Cell.

In 2022 alone, she participated in investment deals for edtech startup SpeakIn and health tech startup Medyseva.

Earlier, she was a senior chairperson of the FICCI FLO Kanpur Chapter. She holds a PhD from IIT Kanpur and completed her postgraduation in economics from Northwestern University.

Aarti started her investment journey five years ago in 2017. So far, she has invested in four tech-driven startups operating in sectors such as health tech, edtech, foodtech and waste management.

Aarti believes in shoring up startup founders by helping them build their ventures and raise funds. Additionally, she is passionate about spreading financial literacy among professionals and homemakers.

2. Anisha Singh

Anisha Singh is the founder of women-focused VC firm She Capital. She founded the VC firm in 2020 to stimulate more women founders to enter India’s startup ecosystem. Some of the portfolio companies of the VC firm are Samosa Singh, Spark Studio, Elev8 Sportz, and Nova Nova.

Earlier, she founded ecommerce platform MyDala and also headed B2B startup Kinis Software as its CEO. She has also worked as a manager with Centra Software.

She is mostly seen talking about women’s empowerment and supporting women-focussed businesses and startups.

3. Alia Bhatt

Bollywood superstar Alia Bhatt has also donned the hat of an investor and has quite an interesting portfolio. One of her prominent investments was in beauty ecommerce marketplace Nykaa. Her investment grew more than 10X within months to INR 54 Cr when Nykaa got listed on the Indian bourses.

Bhatt’s portfolio also includes Mumbai-based personal styling platform Style Cracker and Kanpur-based biomaterial startup Phool.

Besides investing in other startups, Alia Bhatt has also set up her startup, Ed-a-Mamma, which operates in the kidswear category.

4. Anjali Bansal

Founder and chairperson of Avaana Capital Anjali Bansal has been actively investing in Indian startups. In 2022, Avaana funded four Indian startups — BambooBox, Gold Setu, and Groyyo, according to the Inc42 funding report.

In addition to the aforementioned startups, Anjali has invested in various startups – Delhivery, Urban Company, Darwinbox, and Nykaa, to name a few.

Currently, Bansal is a member of the ONDC steering committee. She is also on the board of various Indian companies such as Tata Power, Nestle India, and Piramal Enterprises. She has also worked with TPG Growth, Spencer Stuart, McKinsey, and Dena Bank

5. Anjali Sosale

Anjali Sosale, partner at Waterbridge Ventures, plays a pivotal role in shaping the success of early stage technology companies for the VC firm. With a special focus on consumer tech, ecommerce, and marketplaces, Sosale wants to enable the next wave of rural Indian internet users

She is an active investor in startups such as BigFatPhoenix, BimaKavach, BitClass, CBREX, Downtown Club, EloElo, and Yellow Metal. 

Waterbridge Ventures specialises in early-stage technology investments, providing $250K to $3 Mn to seed to Pre-Series A stage companies.

With a portfolio comprising 31 investments and collaborating with over 70 founders, Waterbridge takes a lead role in funding rounds and remains dedicated to supporting its portfolio companies throughout their growth journey, extending investments until Series C. 

6. Ankita Vashistha

Ankita Vashistha is the founder of Saha Fund and StrongHer Ventures, which backs female-led early-stage startups operating in the fintech, health tech, consumer tech, and Web 3.0 segments.

She is currently associated with multiple names such as MySpaces, Tholons Capital, NASSCOM,  Aureos Capital, and Abraaj Group. In her more than 10 years of professional journey, she has worked with tech ventures, private equity and VCs across the UK, the US, and Asia.

She is currently an active investor in Indian Angel Network. Her startup portfolio comprises startups such as Licious, Uniphore, Fitternity, LoveLocal, Zumata, and Insta Health.

She got her master’s degree from the Cranfield School of Management, Stanford University, and is an alumna of Ramaiah Institute of Technology.   

7. Archana Jahagirdar 

Archana Jahagirdar is the founder and managing partner of Rukam Capital, which invests in early-stage consumer products and services companies. 

Earlier, she headed companies like Textron, Angelworks and Espace Corporate and worked as a journalist with media organisations such as Business Standard, The Times of India, Zee News, Outlook, and India Today.

In the last few years, Archana has made more than 10 investments in startups like Yoho, Sleepy Owl Coffee, Anveya, Pilgrim, The Indus Valley, and GoDESi, among others. She completed her masters in English literature from St Stephen’s College.

8. Archana Priyadarshini

Archana Priyadarshini is a founder of Forward Slash Capital, which backs pre-seed to pre-Series A stage tech startups. In 2022, she invested in four startups – Broomees, CogniSaaS, Ekank Technologies, and Threado.

Over the years, she has participated in more than 25 startup deals, which include Metastable Materials, Exprto Live, and VAMA, to name a few.

At the moment, she is working as a general partner at PointOne Capital. She has also worked with companies such as Wells Fargo, Bootcamp Fitness Studio, IBM and CGEY. She has done her B.Tech in chemical engineering from IIT Kanpur

9. Bala C Deshpande

Bala C Deshpande is the founder partner of Megadelta Capital, which is an India-focussed mid-market growth fund. It typically invests $15 Mn to 25 Mn of growth equity in startups across sectors such as consumer, healthcare, and enterprise tech.

Megadelta Capital’s portfolio includes startups such as ecommerce unicorn Firstcry and health tech startup GOQII, among others.

Deshpande has nearly two decades of experience in investment advisory. She started her investing career with ICICI Venture in 2001. Later, she joined global VC firm NEA to set up their India platform where she headed the practice for ten years and helped NEA US in investing and backing startups in the mid-market space.

10. Bharati Jacob 

Bharati Jacob is the founder and managing partner of Seedfund, which invests in startups operating in diverse industries. She holds more than 24 years of experience in venture investing, marketing, and financial services.

Earlier, she worked with venture capital firm Infinity Venture Fund, investment bank Lazard, and aviation company Northwest Airlines.

An XLRI graduate, Jacob completed her MBA in marketing from the Wharton School, University of Pennsylvania.

11. Bhawna Bhatnagar 

Bhawna Bhatnagar is the cofounder of We Founder Circle (WFC), which invests in pre-seed to pre-series A-stage startups.

So far, she has invested in edtech OLL and F&B direct-to-consumer (D2C) startup Bored Beverages. Besides, she has also participated in six startup deals, including ParkMate, ParkMate, Quizy, and Commaful.

Prior to founding WFC, she worked with leading companies such as ByteDance, Cheetah Mobile and India Today.

After completing her bachelor’s in biochemistry from Delhi University in 2009, she went to the Indian Institute of Mass Communication and then earned her master’s degree in East Asian studies from Delhi University in 2014.

12. Debjani Ghosh 

Debjani Ghosh is currently the president of NASSCOM, an industry body representing the IT-BPM space. In her career of nearly three decades, she has worked with Intel Corporation and Yes Bank.

She has also been on Cisco’s India Advisory Board and served as an advisor to the FICCI S&T/Innovation Committee.

An MBA from S.P. Jain Institute of Management and Research, Debjani completed her graduation in political science from Osmania University. 

13. Deepika Padukone 

With five startups in her portfolio, Bollywood actor Deepika Padukone has recently worn the investor’s hat. She began her entrepreneurial journey by founding 82°E in 2021.

82°E, which is led by Padukone and Jigar Shah, got $7.5 Mn funding from DSG Consumer Partners and IDEO Ventures, along with multiple ultra-HNIs and Padukone’s family office, Ka Enterprises.

Ka Enterprises mainly backs consumer and consumer-tech companies across the globe. Its portfolio companies include Epigamia, Furlenco, Blu Smart, Bellatrix, Playshifu, Atomberg, Front Row, Mokobara, Supertails, and Nua. 

14. Ghazal Alagh

Mamaearth’s cofounder Ghazal Alagh is an active angel investor. In 2022, she backed 14 startups, including Humpy Farms, unScript AI, and Wishlink. Her startup portfolio also comprises companies like BlissClub, HumpyFarm and Uvi Health.

Before founding Mamaearth, she set up a fitness platform dietexpert.in, which shuttered its operations in 2013.  She has a BCA degree from Panjab University and holds certifications in visual arts from New York Academy

15. Ishani Chanana

Ishani Channa, partner investments at Sarcha Advisors, plays a pivotal role in managing family office investments and shaping capital allocation strategies across a diverse spectrum of assets, encompassing equity, debt, and alternative investment opportunities, with a significant focus on startups.

With investments in over 50 startups, including notable names like BluSmart, Josh Talks, STAGE, TrulyMadly, Prescinto, and The New Shop, and active participation in 20+ follow-on rounds, Ishani has been instrumental in nurturing entrepreneurial talent and fostering innovation.

In addition to her role at Sarcha Advisors, Chanana is an angel investor and has stakes in startups like JumpingMinds, BatX Energies, Yatrikart, Newmi, and Jobsgaar.

Prior to her current role, Ishani spent nearly four years at a hedge fund within Edelweiss Financial Services, where she honed her skills in buy-side research. Her work involved in-depth analysis of Indian-listed companies across diverse sectors, making valuable contributions to investment decisions within the fund.

Chanana holds a master’s degree in finance from Warwick Business School. Her investment track record includes successful exits and the ability to attract substantial investments from renowned investors to her portfolio companies, underscoring the prudence of her investment choices

16. Kanika Mayar 

Kanika Mayar is a partner of Vertex Ventures, which infuses money in seed to Series B-stage startups operating in Southeast Asia and India. Vertex’s portfolio companies include Grab, Patsnap, 17Live, Nium, FirstCry, Licious, AsianParent, Validus, and Warung Pintar, among others.

So far, Kanika has participated in four startup deals – Chatty Bao, Proactive For Her, Onato and Karkhana.io. She has also worked with leading companies such as IFC, TechnoServe, Goldman Sachs, and Ernst & Young.

A graduate of economics from the prestigious Lady Shree Ram College, Kanika completed her MBA from IIM Ahmedabad.

If you are a women investor or want to nominate a women investor in the startup ecosystem, nominate us at editor@inc42.com. This is a running list (and not a definitive one), and we would love to add more names who are changing the investing landscape in the Indian startup ecosystem. 

17. Namita Thapar

Namita Thapar is the executive director of India Business for Emcure, a pharmaceutical company. Thapar rose to fame after she joined the TV Show ‘Shark Tank India’ as one of the sharks.

So far, Thapar has participated in 11 startup deals, including Medulance, Ubreathe, Snitch, JhaJi Store, and TagZ Foods, among others.

She recently invested in ePharmacy when the startup bagged an investment of INR 2 Cr from multiple investors on Shark Tank India.

A chartered accountant from The Institute of Chartered Accountants of India, Namita holds an MBA degree from the Fuqua School of Business.   

18. Nandini Mansinghka

Nandini Mansinghka is the co-promoter and CEO at Mumbai Angels Network. She is also a founder investor at Digibooster, a content marketplace. Over the years, she has participated in more than 55 startup deals.

Founded in 2006, Mumbai Angels Network invests in early-stage startups in India. The network backs a slew of startups such as Adsparx, Adonmo, and BabyChakra, among others.

After her graduation (BCom) from the University of Calcutta, she completed her CFA from the Institute of Chartered Financial Analysts of India

19. Nruthya Madappa 

Nruthya Madappa assumed the role of partner at the early-stage VC firm 3one4 Capital earlier this year, where her primary responsibility is to enhance and fortify the firm’s portfolio.

Her journey at the venture capital firm began in 2020 when she joined as a principal and took charge of growth and capital development.

Demonstrating exceptional leadership and strategic acumen, she swiftly progressed to the position of director for the growth and capital vertical in the subsequent year.

20. Padmaja Ruparel

Padmaja Ruparel is one of the cofounders of the Indian Angel Network. She is also recognised as a key player in the Indian entrepreneurial ecosystem.

So far, she has participated in over 16 startup deals, which include names like Phool, Nivesh, Sirona Hygiene, goStops, and Dhruva Space, among others.

Last year, Indian Angel Network launched the IAN Alpha Fund, a SEBI-registered category II venture capital fund, worth INR 1,000 Cr.

So far, Indian Angel Network has invested in over 180 startups. Some of its portfolio companies are Zypp Electric, Crest, Huddle, Elctrifuel, Indium Finance, and Sirona Hyginene, among others.

Before starting her journey in the Indian startup ecosystem, Ruparel worked as the head of corporate communications at the UK-based Xansa.

21. Paula Mariwala

Paula Mariwala has been an early-stage investor for the past 15 years, and is a founding partner of Mumbai-based Aureolis Ventures, and the founder of Stanford Angels & Entrepreneurs India.

A Stanford alumna, Paula invests in early-stage startups and has been a key investor in Tapchief, Tread, Browntape, Thinklabs, RedBus, and Carwale, among others. In terms of sectors, she has been actively investing in segments like technology, sustainability, social impact, women empowerment, and education.

Paula is a member of the governing council of the Foundation for Innovation and Technology Transfer, IIT Delhi. She is also on the board of the Center for Human Rights and International Justice at Stanford University.

22. Pearl Agarwal

Pearl Agarwal is a prolific angel investor, with investments in 16 startups across sectors such as web3, fintech, edtech, gaming, and SaaS. Some of her notable investments include InFeedo, BluSmart Mobility, GroMo, Trell, and Redwing Labs.

Pearl is also the founder and MD of Delhi-based VC firm Eximius Ventures, which has its investments in startups such as Eka.Care, Jar, iTribe, Fego, Zorro, KalaGato, Oyela, Flux, Stan, Fleek, and Skydo.

Before becoming a full-time investor, Pearl worked at Merril Lynch. Pearl has also worked in the private equity sector with names like UTIMCO and Global Infrastructure Partners.

She is also the cofounder of DotReview, a platform where first-time investors can learn about startup funding.

23. Pooja Mehta

Pooja Mehta is the chief investment officer (CIO) at JITO Angel Network (JAN), a platform which connects angel investors with startups. She has expertise in evaluating startups, managing angel investment deals, and administering investment operations.

In the last two years, she has participated in 30 startup deals – KloudMate, Nexus Power, and NewsReach India.

Under her leadership, the JAN network has grown to over 350 members, with an investment of INR 100 Cr in various startups. Pooja is also the CIO at the JITO Incubation & Innovation Foundation.

A seasoned management professional with an MBA degree in finance, Pooja’s skillset ranges from business development, market research, and management to building business strategies and financial analysis

24. Priyanka Chopra

Priyanka Chopra, in her capacity as the COO and managing partner at CIIE.CO, assumes a pivotal role in the startup ecosystem, particularly focussing on digitisation, deeptech, climate tech, and financial inclusion.

With a dedicated commitment to empowering women entrepreneurs, she takes the lead in spearheading accelerator and incubation programmes.

These initiatives are designed to enhance skills, promote technology adoption, establish a robust online presence, drive customer engagement, and facilitate strategic partnerships.

Chopra has significantly influenced over 1,200 startups through various CIIE.CO programmes. Notable startups under her guidance include Razorpay, which turned into a unicorn in 2020.

25. Raakhe Kapoor Tandon

Raakhe Kapoor Tandon runs a family office – The Three Sisters: Institutional Office – with two of her sisters, Radha and Roshini Rana Kapoor. Raakhe, Radha and Roshini are the daughters of Rana Kapoor, the founder and MD of Yes Bank.

Under the family office, Raakhe founded ART Capital (India), an investment vehicle. The Three Sisters also has its investments in Delhi-based Awfis Space Solution, a real estate tech startup.

A Wharton alumna, Raakhe has founded two more ventures under ART Capital – ART Housing Finance (India) and Rural Agri Ventures India.

While ART Housing Finance provides long-term mortgage finance to retail customers, Rural Agri Ventures is an incubation/project development firm focussed on agritech startups. 

26. Rema Subramanian

Rema Subramanian is the co-founder and managing partner at Ankur Capital Fund, which backs early-stage startups in the agritech, fintech, health tech, and edtech segments.

She is currently working as an advisor consultant at DY Works. Earlier, she has worked with various Indian companies such as Dasra, ADTS, Element K India, Zee Interactive Learning, Ion Exchange, Datamatics and JK (Raymonds).

So far, Rema has participated in more than four startup investment deals. These names include SportVot, Josh Talks, MyCaptain, and Banyan Environmental Innovations.

A cost accountant from ICFAI, Rema has worked across education and IT/ITES, taking young companies from scratch to midsize ventures.

27. Ritu Verma

Ritu Verma, the cofounder of Ankur Capital, has backed several startups over the years. Some of the companies in her portfolio include names like CropIn, ERC, HealthSutra, Big Haat, Niramai, Tessol, Suma Agro, and Karma Healthcare.

In 2022, Verma took part in more than 13 startup investment deals, including D-Nome, IBISA, Vegrow, Wasabi, and Offgrid Energy Labs, among others.

At present, she is acting as a board observer in various Indian companies such as BigHaat India, String Bio, AgricxLab and Niramai. She is also on the board of Tessol, Health Sutra and CropIn.

Earlier, she worked with Truven, Philips and Unilever. She has a PhD in physics from the University of Pennsylvania and an MBA from INSEAD.

 28. Ruchi Kalra 

Ruchi Kalra helms the financial affairs at one of the few profitable new-age tech startups in the country. The CFO of B2B building material marketplace OfBusiness also helped found the startup back in 2016 and has not looked back since then.
An alumna of the prestigious Indian Institute of Technology Delhi, Kalra studied chemical engineering and then went on to work at Evalueserve for a couple of years. Afterwards, Kalra enrolled at the Indian School of Business in Hyderabad and completed her MBA.

Immediately after that, Kalra landed a job at McKinsey & Company and was entrusted with overseeing the insurance and retail banking sector. After nine years working at the consulting firm, Kalra took the plunge into the world of entrepreneurship and helped found OfBusiness.

Not stopping there, she has helped scale the business to new heights while she has also continued investing in multiple other businesses as an angel investor. She has so far invested in as many as 10 startups, as an angel, including seafood marketplace Captain Fresh, tyre marketplace TyrePlex, women-led lifestyle brand FableStreet, and B2B pharmacy marketplace Saveo, among others.

29. Seema Chaturvedi

Seema Chaturvedi, the Founder and Managing Partner of Achieving Women Equity (AWE) Funds, boasts an impressive 25-year track record in capital markets and financial management. Her primary mission is to drive gender equity in entrepreneurship.

A staunch advocate for entrepreneurship with a specific focus on women’s empowerment, Chaturvedi aims to empower 30 Mn women in India by 2030 through AWE Funds.

She also chairs TiE Global’s prominent initiative, the Project All India Roadshow for Women’s Economic Empowerment through Entrepreneurship (AIRSWEEE), securing funding from the US Department of State for six consecutive rounds.

Earlier this year, AWE Funds announced the first close of its maiden fund in India – the Achieving Women Entrepreneurs Early Growth Fund I – at $15 Mn. While promoting gender equity and climate action as a strategy, the fund aims to invest in scalable innovations in sectors such as climate tech, agritech, health tech, edtech and fintech.

30. Shagun Tiwary

Shagun Tiwary is a senior principal at Verlinvest, a Belgium-based investment firm. She is equipped with 12 years of work experience and has invested in companies across consumer and healthcare services such as Dr Lal PathLabs, Indira IVF, Epigamia, and Veeba.

Prior to joining Verlinvest, she worked at TA Associates and Nomura in Mumbai, where she focussed on growth equity investment and capital market transactions. She holds a master’s degree in economics from the Delhi School of Economics, University of Delhi.

Verlinvest is largely involved in late stage venture capital funding and mid-market private equity. Typically, the firm invests between $20 Mn and $200 Mn in startups, depending on the stage they are in.

31. Shanti Mohan 

Shanti Mohan is the founder of LetsVenture, a Bengaluru-based investor network that allows angels and HNIs to invest in startups. She has also founded trica, a platform that allows people to invest in startups and private equity.

In the last few years, she participated in more than 10 startup deals, which include Minko, Simply Services, Bimaplan, and Aulerth.

With LetsVenture, Shanti has invested in startups such as Absolute Foods, Agnikul, BharatX, CityMall, Dukaan, Trell, Yulu, Blusmart, and The ePlane Company, among others. Her personal portfolio comprises Siply, Minko, and Bimaplan.

Shanti is an active angel investor and part of the SEBI advisory AIF committee. She is also active with the RBI Council on startup funding. Further, Shanti is part of the startup committees of several states in India.

32. Shrishti Sahu

The founder of Hustle Hard Ventures, Shrishti Sahu, has been actively supporting Indian startups and has so far backed 30 startups, including Plum, Kutumb, Rupifi, Chingari, 10Club, Leap Club, Eeki Foods, GrowthSchool, Accacia, Descrypt, and Gold Setu, among others.

Sahu shared that she writes off cheques between INR 3 Lakh and INR 25 Lakh for homegrown startups.

Currently, she is a managing partner and angel investor at Swadharma Source Ventures. She has also worked with multiple companies like Emoha Eldercare, Facebook, Lumis Partners, Aqaya Source Foundation, and Aqaya. She completed her graduation from the University of Warwick.

33. Shruthi Cauvery Iyer

Caha Capital founder Shruthi Iyer is an active angel investor, who is overseeing two early-stage startups’ expansion strategies. She administers Wharton Alumni Angels (South Asia) and HBS Alumni Angels.

Earlier, she worked with international companies such as Agate Medical Investment LP, PT Perintius,  International Finance Corporation (IFC), and Eastern Energy Resources. She is one of the cofounders of the ecommerce startup Blend8.

She did her MBA from the Wharton School and completed her B.Tech from Visveswaraya Technological University, Karnataka.  

34. Sowmya Suryanarayanan

Sowmya heads the impact and ESG functions at Aavishkaar Capital – an impact fund manager that invests in impact enterprises across India, South and South East Asia and East Africa. She is responsible for delivering significant impact, gender and ESG value across Aavishkaar’s various impact funds and portfolio companies.

At Aavishkaar, Sowmya has helped invest in sectors such as agritech, financial inclusion, and essential services. Some of the portfolio companies of Aavishkaar Capital include Nalanda Learning Systems, GoBolt, Milk Mantra, and Seven Ocean, among others.

35. Surabhi Washishth

Surabhi Washishth, the founding partner of Paradigm Shift Capital, has been actively supporting the Indian startup ecosystem.

So far, she has investments in 20 startups, including Ixana, Zeda, Landeed, Praan, 10XAR, Samudai and Arcana Network. In her personal capacity, she writes cheques between $250K and $300K for startups.

At present, she is acting as a ‘Global Shaper’ with the World Economic Forum. She has also worked with multiple companies such as WeWork India, Headout, Target, AOL, and ING Life, among others. She has a B.Com degree from Christ University, Bengaluru. 

36. Swapna Gupta 

A prolific investor, Swapna Gupta is currently a partner at Avaana Capital, a climate-focused VC firm. Before joining Avaana Capital, Swapna spent more than seven years at Qualcomm Ventures, where she led India investments.

She is an investor and board observer in multiple Indian startups, including Locus, Shadowfax, Ninjacart, Zuddl, FabHotels, MoveInSync, Reverie, Stellapps, and attune, among others.

Swapna also launched Qualcomm Women Entrepreneurs India Network (Qwein), a networking, learning, and mentoring programme for deeptech, and early-stage female entrepreneurs in India.

Swapna has recently been recognised by GCV among the Top 50 emerging leaders in the corporate venture community. Surprisingly, she is the only Indian on the list. She is also part of the prestigious Global Kauffman fellows programme.

37. Swati Nangalia Mehra 

Swati Mehra’s tryst with investments began long ago. One of her first jobs was to oversee investment research in the consumer space. The job came in handy when she decided to take the plunge into the world of investing. 

In 2014, she helped cofound Sixth Sense Ventures, the country’s first domestic and consumer-focussed venture fund. Since then, the firm has invested in a host of new and emerging D2C brands that have created a niche for themselves.

Nangalia Mehra has helmed the venture fund, which has invested in a slew of emerging brands, including homegrown beer brand Bira91, men’s grooming and personal care brand Bombay Shaving Company, and gaming and entertainment platform Smaaash. She also has stakes in CarterX, Pariksha, and ProcMart. 

38. Tarana Lalwani

Tarana Lalwani is a founding partner of InnoVen Triple Blue Capital, which has backed multiple startups such as Zetwerk, Chaayos, Ather, slice, and Bounce.

As an angel investor, Lalwani bets on startups working in the consumer, consumertech, health tech, fintech, and SaaS sectors. She also holds expertise in pre-seed to Series D funding rounds via equity and debt instruments.

Presently, she is an advisor at Aureolis Ventures and a senior director at InnoVen Capital India. Earlier, she worked with companies like Anand Rathi Securities, Kae Capital, SeedFund, Edvance Learning, Webaroo, Radian Group, and Morgan Stanley.

She is also on the advisory board of Oscar Foundation and CII. Not only this, Tarana is currently part of the venture capital and private equity committee of IMAI (Internet and Mobile Association of India).

She holds an MBA degree from Columbia Business School and a bachelor’s degree from La Salle University. 

39. Vani Kola 

Vani Kola is the founder and managing director of the early-stage VC firm Kalaari Capital. She has led over 30 investments at Kalaari. Some of the prominent names include Dream11, Myntra, Cure.fit, and Snapdeal.

Vani is currently on the board of CXXO. She has also worked with Certus Software and RightWorks. She likes mentoring first-time entrepreneurs and ushering them into becoming seasoned business leaders. So far, she has participated in over 63 startup deals. Some of these names include Climbes, Bombay Play, Zocket, StanPlus and Zluri, among others.

After graduating from Osmania University, she completed her master’s degree from Arizona State University.

40. Varsha Tagare

Varsha Tagare is the managing director at Qualcomm Ventures where she manages a $150 Mn fund dedicated to India and cross-border digital enterprise investments.

Prior to joining Qualcomm Ventures, Tagare served as an investment director at Intel Capital, responsible for global equity investments in mobile technology.

At Qualcomm Ventures, she has led and managed investments in Capillary Technologies, Ideaforge, MapMyIndia, among others. 

41. Vineeta Singh

Widely popular for being featured on Shark Tank India, Vineeta Singh is the CEO and cofounder of beauty and personal care brand SUGAR Cosmetics. Singh is an alumna of the prestigious Indian Institute of Technology, Madras and the Indian Institute of Management, Ahmedabad.

Singh is a serial entrepreneur and the founder of FAB BAG, a beauty and grooming subscription startup. Since appearing on Shark Tank India, Singh has shot to fame and has invested in a slew of Indian startups featured on the show.

As an angel investor, Vineeta Singh has participated in multiple fundraisers. Some of her bets include Padcare Labs, JhaJi Store, Snitch, and Josh Talks, among others.

Note: The information has been collected from available public resources and websites.

If you are a women investor or want to nominate a women investor in the startup ecosystem, nominate us at editor@inc42.com. This is a running list (and not a definitive one), and we would love to add more names who are changing the investing landscape in the Indian startup ecosystem. 

Last updated on December 19, 2023 | The list has been updated to include three more women investors. 

The post Meet The 41 Women Torchbearers Of India’s Startup Investment Space appeared first on Inc42 Media.

At an event in Delhi in June this year, the CEO of OpenAI, Sam Altman, was asked if a young team of Indian engineers, loaded with $10 Mn, could build an LLM model similar to that of OpenAI. 

Responding to the question, Altman said that it would be “hopeless to compete with ‘us’ (OpenAI) on training foundation models [and] you shouldn’t try”.

Altman’s comments triggered an immediate backlash and stirred discontent among the Indian tech community. 

While the comment of OpenAI’s reinstated CEO is now history, it has started a catalytic reaction of sorts, as a wave of Indian founders is now seen floating projects dedicated to building foundational LLMs for India and the world.

It is imperative to mention that right after Altman’s infamous remarks, Sridhar Vembu, the founder of Zoho, announced plans to create a proprietary LLM with capabilities encompassing summarization, paraphrasing, and adaptability to novel tasks. Meanwhile, Tech Mahindra is working on Project Indus, an open-source Indic language-based LLM. Similarly, numerous AI startups, including Sarvam AI, SoketLabs, CoRover.ai, are actively engaged in developing LLM models with a focus on the Indic languages.

Adding to this wave of AI-centric innovation, Bhavish Aggarwal, the founder of Ola, has launched an AI company, Krutrim, which claims to have its focus set on constructing foundational LLMs for such languages.

As of now, Krutrim is proficient in understanding and processing up to 22 Indic languages with the ability to write and speak in 10 languages, as per Aggarwal. 

At a time when the LLM fight seems to be intensifying worldwide and in India, Aggarwal-led Krutrim wants to be a step ahead in the AI game. It aspires to develop the entire cloud infrastructure and silicon chips, excluding the fabrication aspect. 

Before we delve into Krutrim’s DNA, let’s understand the startup’s ownership and funding status.

Krutrim SI Designs operates as an independent entity and pursues funding autonomously. It has secured an undisclosed amount of funding from investors, including Aggarwal.  

Although Aggarwal did not disclose its existing shareholding status, he confirmed that the company has already raised some funding. As per reports, the newly incorporated AI startup had raised $24 Mn in debt from Matrix Partners in October this year.

Meanwhile, sources close to the company informed Inc42 that Krutrim was in the process of securing another round of funds, with the announcement expected before March 2024.

Now, let’s steal a glance at the core of Krutrim’s DNA and understand how it could be the answer to the GPTs of the world in India.

Krutrim Wants To Build An India-Centric AI

Serial entrepreneur Aggarwal, who founded Ola Cabs in 2010 and Ola Electric in 2017, asserted that many popular international LLMs lack true representation of the Indian context and data.  

“If they genuinely want to adhere to the democratic values, they must ensure that the data is representative of the population scale. About 20% of the data in these models should be Indian, reflecting democratic values. Unfortunately, this is not the case, leading to outputs that present a caricature of India, even in something as basic as an Indian woman’s saree,” Aggarwal said.

At Krutrim, the intention is to build multimodal models, particularly image generation models. “While we are not there yet, we initially focussed on text and language models. We are actively seeking partnerships within the ecosystem to bring our models to the market and collaborate in creating Indian data sources for these other modalities,” Aggarwal added.

Additionally, Aggarwal emphasised that most Western AI solutions not only lack accuracy in the Indian context but are also prohibitively expensive. Krutrim aims to address these challenges by developing full-stack AI solutions.

The startup is set to accomplish several ambitious goals, encompassing foundational LLMs, AI cloud infrastructure, and the in-house development and manufacturing of AI-optimised silicon chips.

The head of strategy at Ola Electric, Ravi Jain, emphasised that the company is actively designing and developing in-house technologies such as a submersion cooling system for cloud infrastructure and chip designs. 

“Krutrim’s innovations will simplify and streamline everyday interactions across various socio-economic strata in India. For instance, tasks like reserving a table could become more straightforward. In the future, Krutrim aims to manage extensive customer support for emerging startups and businesses, providing real-time information and aiding in product selection, thereby impacting even rural economies significantly,” Jain said.

The base LLM of Krutrim is trained on an impressive 2 Tn tokens, representing the largest dataset of Indian data used in training to date, according to Jain. 

He added that Krutrim is designed to strike the right balance between performance and price, making it suitable for powering a variety of day-to-day applications. Additionally, the company is developing Krutrim Pro, a large multimodal model with advanced problem-solving and task execution capabilities, slated for launch in the next quarter.

Krutrim is set to be available in beta version as an API for enterprises and developers starting January 2024, facilitating the creation of AI-driven assistants capable of conversing in multiple Indian languages. Krutrim Pro is anticipated to be available in Q4 FY 2024.

Aggarwal envisions Krutrim’s superior linguistic skills as a valuable tool across diverse domains, ranging from education to business communications. The platform incorporates the latest techniques in safe AI to mitigate inappropriate responses. 

It is also actively working on developing AI infrastructure, including indigenous data centres, server computing, edge computing, and supercomputers, with production scheduled for mid-2024 for prototypes and a rollout production roadmap by the end of 2025.

An early access programme is currently underway, until January 2024, with a simple sign-up page on the website. The open release is scheduled for January 2024, and open APIs will be accessible to all developers by February 2024. Ola plans to integrate Krutrim across its group companies for sales, service, support, and other operational processes.

Krutrim: The Ethical AI?

The startup has been launched at a time when cases of misinformation and deepfakes are on the rise, with GenAI at the centre of the ruckus. 

Aggarwal emphasised that the current safety debates around AI are heavily influenced by Western concepts. While Krutrim is being designed with safety in mind, he asserted that “the approach to safety will be grounded in an Indian perspective.”

The table below provides a comparative overview of how ChatGPT and Krutrim approach ethical considerations and biases. However, before that, it is worth noting that Krutim is yet to be launched in beta mode while ChatGPT is fully functional. Also, we are using the specs of ChatGPT 3.5.

Meanwhile, life seems to have come full circle for the homegrown GenAI ecosystem. Within months of Altman’s controversial ‘don’t even try’ statement, the country appears to be at the cusp of an AI revolution but the path ahead appears to be a long one. 

Having joined the GenAI fray a little late, Krutrim will now have to spar with domestic players like Bharat GPT by CoRover.ai, Pragna by Soket Labs, Tech Mahindra-backed Project Indus and Sarvam AI in India and foreign entities such as OpenAI’s ChatGPT, Google’s Bard and Elon Musk-backed Grok AI to secure its market share. 

According to Inc42’s “India’s Generative AI Startup Landscape, 2023” report, the country’s GenAI market is projected to surpass $17 Bn by 2030 from $1.1 Bn in 2023, growing at a CAGR of 48%.

With Krutrim, too, in the GenAI race, it remains to be seen who will emerge as the Indian AI juggernaut in the years to come, outpacing its Western counterparts.

The post Can Bhavish Aggarwal’s Krutrim Take On ChatGPT With Its GenAI For India Playbook? appeared first on Inc42 Media.

It’s been a tale of two halves for PhonePe in 2023. But now at the end of the year, it would seem the stage is set for the fintech giant’s biggest onslaught so far.

If the first half of the year was all about getting armed for the battle with nearly $1 Bn in funding, the rest of it was about showing what it plans to do with all that money, with several new products ranging from lending to insurance to app development and digital commerce.

But beyond the announcements and the fundraises, PhonePe is perhaps signalling to the Indian tech ecosystem that this is its time.

To put things in context, the company has raised nearly 10% of all funding raised by Indian startups this year. Naturally, there’s a feeling that PhonePe is growing too big to fail, and many compared it to how Walmart gave Flipkart some much-needed impetus in 2017 and 2018 post the acquisition by the US retail giant and subsequently multiple rounds of capital infusion.

“This is what catapulted Flipkart in 2018 towards its current status as the de facto ‘Indian’ ecommerce player, and now it’s PhonePe’s time to grow into its valuation,” a CXO at a Bengaluru-based fintech unicorn told us.

Indeed, it’s hard to escape PhonePe in Bengaluru where it’s the default payments app and its soundboxes and point-of-sale devices are ubiquitous at most small merchants — whether roadside vendors or bakeries.

Such is the dominance of PhonePe in its hometown that spotting a Paytm soundbox or any other rival comes as a surprise. But it would be wrong to think that this is PhonePe’s endgame.

As we have seen throughout this year, PhonePe has much bigger plans. It has the capital, the key personnel and the burgeoning product line-up to bank on. The year has almost come to an end, but PhonePe’s era is just beginning.

With new products in lending, insurance and tax payments on the core PhonePe app, as well as separate apps for ecommerce (Pincode) and investment tech (Share.Market), PhonePe is gearing up in a big way for 2024. Even though some of these products are uncharted territory for PhonePe, it has the resources to succeed in these new areas.

In many ways, 2023 was about setting the stage for this completely new vision. Now as PhonePe prepares for a potential initial public offering (IPO) in 2024-2025, it’s important to understand where the company finds itself at the end of the year.

Recapping PhonePe’s 2023

It all started in late 2022 with the separation from Flipkart and redomiciling to India. This was a critical first step in the plan, which came with a huge tax bill for many of PhonePe’s investors.

The INR 8,000 Cr tax outlay seems like a huge expense, but it was a necessary step to bring PhonePe to India and ensure that the big product plans are not derailed by corporate structures.

Even beyond the tax bill, there was more confidence from investors when they poured millions into the fintech decacorn. The funding spree was led by Walmart, General Atlantic, Ribbit Capital, TVS Capital Funds and others. The plan was to raise $1 Bn, but  PhonePe managed to secure $850 Mn.

PhonePe had its war chest ready and soon after came a flurry of new products that have changed the company considerably and given observers a thing or two to ponder upon.

In April, it launched Pincode, an ONDC-integrated digital commerce app, followed by merchant lending services in June. Then came a new point-of-sale device for UPI and cards, income tax payments and health insurance products in July.

In August, we saw the introduction of Share.Market, a separate product for investments and stock broking, and finally the formal launch of the Indus Appstore in September.

Interestingly, with the last of these product launches, PhonePe is not just a fintech app any more. And indeed Indus Appstore holds plenty of potential for PhonePe in the long run.

A New Trump Card: Indus Appstore

In March, we said that PhonePe wants to be Paytm, but that comparison seems off the mark given the launch of Indus Appstore, which promises to be another lucrative long-term revenue stream.

The app store is an alternative to Google Play on Android, and PhonePe’s investment and acquisition was finalised soon after the Competition Commission of India ruled to allow third party app stores on Android devices.

So the more we think about what PhonePe is doing at the end of 2023, the more we wonder whether the Walmart-owned giant is indeed more than a fintech platform.

With 500 Mn lifetime registered users and 37 Mn+ merchants on its platform, PhonePe is poised to press ahead on other fronts besides payment and fintech.

The Indus Appstore product is unmatched by PhonePe’s primary competition such as Paytm, CRED or Groww. While these are also fast building up platform plays around multiple products, PhonePe’s Indus Appstore could be the trump card in the revenue race.

For context, in-app spending is forecast to reach $182 Bn by 2024 and $207 Bn in 2025, according to research firm Sensor Tower. Consumers are said to have spent $132 Bn in 2021, so the projected figures for 2024 represent nearly 40% growth in two years.

Google will get about $10.3 Bn in revenue from app sales and in-app purchases from the Play Store globally in 2023, according to a Time report. In this context, it’s easy to see why PhonePe has invested heavily in an app store. More importantly, Indus does not have Google’s stipulations around commissions and billing policy.

The likes of MPL, Dream11, Nazara, A23, Gameskraft and others have already come on board the Indus Appstore thanks to its zero commission policy. Plus, Indus Appstore is available in 12 Indian languages, which is also expected to be a major competitive advantage against Google and Apple.

While zero commissions have added to the initial attraction for Indus Appstore, PhonePe is likely to add commissions in the future to make this a veritable revenue source.

Both Google and Apple have been hit by antitrust cases in the US and India in relation to their app store policies. It’s the perfect entry point for PhonePe. PhonePe’s marketing machine has also stepped on the accelerator in recent times to show that it has the user base to capitalise.

The PhonePe-Verse 

“PhonePe is living up to its name. It wants to be everything on your smartphone, from the app store to financial services to digital commerce and more. The Indian market is fast maturing and this is perhaps the best time for a super app or platform play,” says the founder quoted above.

It is impossible to look at PhonePe’s year, without seeing the similarities with the competition that is on a comparable scale. The super app movement or the convergence of financial services is a clear theme emerging in 2023.

For several years, it was believed that Indian apps could replicate the success of super apps such as WeChat, Grab or Gojek in China and Southeast Asia.

But while the likes of Paytm tried this in the past, the strategy did not succeed fully due to a lack of market depth and consumer maturity. Even as late as 2021, Paytm bemoaned the fact that the platform model was not well understood by retail investors.

But times have changed and now the Indian market is looking like a better bet for super app players. Let’s look at two key pieces in PhonePe’s armoury in this battle — ecommerce and investment tech.

ONDC’s New Wings

Built on ONDC, the Pincode app was launched in Bengaluru in April where it has already delivered over 1 Lakh orders as of July 2023, and PhonePe has expanded to Delhi NCR, Mumbai, Chennai, Hyderabad, and Pune, among other cities.

ONDC has become the crutch for non-ecommerce players to scale up their digital commerce footprint quickly.

Take for instance, Paytm Mall, which was once a unicorn, but has faded into the background in comparison to marketplace giants Flipkart and Amazon India. Today, Paytm’s digital commerce business also hinges on ONDC, just like PhonePe’s Pincode.

CRED is relying on a highly curated marketplace approach, while Google Pay is playing the aggregator game. PhonePe’s dedicated app is an interesting approach in this space and unlike any other player in the super app race.

A company spokesperson told us, “The initial response and rapid consumer adoption of Pincode has given us the confidence to expand our services. We are fully committed to championing local sellers and delivering an exceptional shopping experience to our consumers.”

The company added that it will be investing heavily to expand to more cities and into more categories, including medicines, fashion, and electronics to become a full-fledged ecommerce app.

Entering The Investment Fray

The other big piece of the puzzle is Share.Market, which PhonePe has sequestered from its core business as is standard practice. Even though it’s a separate app with a stockbroking licence, Share.Market’s revenue growth will be a key contributor to PhonePe’s business in the long run.

The revenue model for stock broking is relatively straightforward as platforms take a cut on trades and transactions. With the right scale, profitability is not a long shot either.

Fellow Bengaluru fintech unicorn Groww reached profitability in FY23 thanks to its growing user base and today has more than 6.63 Mn+ active investors.

This makes the company the biggest discount brokerage by clients in India. PhonePe would be betting that its existing user base of 200 Mn+ monthly active users can help it leapfrog Groww, Zerodha and others.

At the scale that PhonePe operates on, even an incremental increase in the volume means tens of millions more revenue-generating transactions. For instance, Paytm Money turned profitable in FY23, posting a net profit of INR 42.8 Cr and bounced back from a loss of INR 10.7 Cr in FY22, helped by steadily growing brokerage income.

In a statement, a PhonePe spokesperson added that in the past two years, the company has seen a huge increase in adoption from Tier III  and IV cities and beyond when it comes to payments and other in-app services.

And now is the time to press the accelerator on other products that are tied into the payments core. PhonePe said it registered INR 2,914 Cr as revenue on a consolidated basis in FY23, but the company did not reveal whether it has managed to bring its losses down from the INR 2,013 Cr it reported in FY22.

What we do know is that PhonePe has reached a $1.3 Bn in lifetime total payments value, according to Walmart CFO John David Rainey. Will this translate into profits in the next year?

Where Will PhonePe Go In 2024?

Revenue from the investment tech business will likely contribute in a major way towards bringing the consolidated business towards the black. But other parts of the PhonePe empire will also be key to getting out of the loss-making streak.

It’s interesting that the new products at PhonePe are grabbing a lot of the interest internally from the company, but let’s not forget that PhonePe’s fintech services primarily hold the key for the turnaround.

Merchant services — lending and device subscription — is likely to be a crucial piece. PhonePe is gearing up to roll out consumer lending services on its platform by January next year. Marking its foray into the consumer lending space, Walmart-backed company is likely to operate initially as a distributor for personal loans.

“The Indian market has seen a lot of maturity in 2023. The most active and habituated fintech customers have become familiar with digital-first financial services, and we believe the opportunity is rich for platforms to accelerate the process of unlocking the flow of money and access to services,” the company spokesperson said.

PhonePe’s trajectory is very similar to Paytm, even if there are many differences in strategy. The scale of both companies is similar in terms of the users, and they have got the market timing right on a number of new products. But Paytm is still a long way away from PhonePe in terms of revenue — INR 7,990 Cr for the listed giant vs INR 2,914 Cr for PhonePe.

For PhonePe, 2024 will be about not just proving its thesis around the platform play, but also utilising its deep pockets to grow sustainably and show profits by the end of the year. This is a critical juncture for the company.

Several startups seemed to have cracked the profitability question in FY23 and many of them did not have the luxury of having raised $850 Mn in the year. PhonePe is like royalty in that sense, but even empires face pressure eventually, even when they have a large war chest.

Funding is not a guarantee of success. PhonePe has the right tools and the stage is set, can the fintech giant make something of it in 2024?

The post PhonePe’s Billion-Dollar Year: A War Chest To Fight Super App Wars appeared first on Inc42 Media.

After a troublesome 2022, when the Meta stock hit a low of $90, the company has bounced back strongly, surging as much as 271% on the US stock exchange this year, as of December 15. 

While the tech giant saw a revival on the back of stronger-than-expected financial results for the company’s second quarter of 2023, the exceptional performance of the company was anchored in various tailwinds, including a suitable growth environment in the home country, improving market sentiment, and aggressive cost-cutting, just to count a few.

However, in stark contrast, the company’s India stay was not very comfortable during the year, as it had its fair share of fires to douse on the regulatory front. 

While regulatory bottlenecks were one of the recurring peeves for Meta’s operations in the country, the social media major was time and again cornered by Indian courts and law enforcement agencies for failing to keep a check on notorious elements, such as deepfakes and misinformation, doing rounds on the platform.

During the year, Indian authorities also unearthed an alleged INR 10,000 tax fraud involving Facebook sellers. Meanwhile, weak global cues forced Meta to cut corners, resulting in an undisclosed number of mass layoffs at its India office. 

Amid all this, the company also grabbed headlines after some of its shareholders mounted an offensive for its alleged bias in India operations. 

Notwithstanding the challenges, 2023 also turned out to be the year during which Meta kicked into motion a full-scale monetisation plan with Meta verified and a slew of offerings for merchants. The Indian arm continued to rake in hefty revenues while the ad business saw considerable growth in the country. 

However, despite gaining a huge response at the outset, its much-touted new launch ‘Threads’ turned out to be a dud. For the uninitiated, Threads is Meta’s answer to X and is focussed on textual conversations, rather than visual media. 

As we approach the end of 2023, let’s steal a glance at the journey of the social media juggernaut in India this year.

Meta’s Sabre-Rattling With The Govt Continued In 2023

The Mark Zuckerberg-led company found itself roiling in a bevy of regulatory challenges throughout the year. As the Centre undertook a flurry of reforms in the form of the Digital Personal Data Protection Act and the new IT Rules, Meta found itself burdened with additional compliance requirements and mandates.

The adverse regulations also made the company liable for hefty fines and opened Meta to potential lawsuits if users’ grievances went unresolved. With little wriggle room under the new laws, the fear of losing safe harbour protections sent alarm bells ringing for the social media behemoth. 

“While the exact impact of the Digital Personal Data Protection (DPDP) Act is yet to be seen, there might be some implications on the storage and transfer of data of Indian subjects.  This might have more of an implication for Meta as their tech implementation might have to significantly change,” identity verification platform IDfy’s chief executive officer (CEO) Ashok Hariharan told Inc42.

What also proved to be a major headache for the company were the large number of content take-down requests by the Indian government. The country emerged as the second biggest source of government requests to Meta in the first half of 2023, second only to the US. 

Between January and June 2023, Indian authorities issued 70,612 requests, of which 63,586 were legal process requests while the remaining were ‘emergency disclosure requests’. 

Curiously, Meta’s worst hit arm in India appeared to be WhatsApp, which found itself at the centre of many regulations. A Competition Commission of India (CCI ) probe into WhatsApp’s 2021 privacy policy case continued to be in limbo. 

As if these issues were not enough, generative AI became a cause of concern for Meta. The deepfake controversy, involving actor Rashmika Mandanna, saw Facebook at the centre of enforcement action as authorities issued notices to the company to act on synthetic content and reveal information about the origins of the post. 

A Long List Of Troubles For Meta India

Amid a tussle with government authorities, Meta also found itself in the middle of other controversies that grabbed negative headlines throughout the year. 

A case in point is the consultation paper floated by the Telecom Regulatory Authority of India (TRAI), which explored the idea of bringing OTT communication apps under the regulatory ambit and selective banning of such apps. 

The aftermath triggered a full-blown war with telcos and startups as telecom operators pitched for a revenue-sharing framework with OTT platforms based on network traffic as a parameter. The proposed move directly strikes at the heart of Meta as it consumes a major chunk of telecom bandwidth domestically. 

Making matters worse was the surge in pesky job calls to WhatsApp’s India users from international mobile numbers. The controversy made the government crack its whip on Meta yet again. Subsequently, 66,000 WhatsApp accounts and 8 Lakh payment wallets were deactivated.

WhatsApp also continued to face outages in the country. Meanwhile, one of the major issues that shook Meta in India came from an unlikely place – its own shareholders. Some of the company’s stakeholders moved a proposal to probe alleged biases in Meta’s India operations and sought an assessment of the same. 

While the proposal was eventually vetoed, this added a new dimension to the already reported allegations that Meta favoured the ruling party. 

Meta’s Sob Story Of Leadership Exodus & Layoffs 

One of the biggest issues that gripped Meta India during the year was layoffs, as the company reportedly fired 400-450 employees in the country.

Even senior executives were not spared by the company as part of its restructuring drive. The company’s director of marketing, Avinash Pant, and director and head of media partnerships, Saket Jha Saurabh, were unceremoniously shown the exits as part of the exercise.

Curiously, just before the layoffs commenced, director and head of partnerships, Manish Chopra, put in his papers.

Meta Ramps Up India Push

Amid all these, the company undertook a slew of new launches in the country as it began to vociferously monetise its offerings. Following the footsteps of its peer X (formerly Twitter), Meta began rolling out its ‘Meta Verified’ service in India in June 2023 to build alternative revenue streams in the country.

It also announced a slew of business-focussed features on WhatsApp to tap into the B2B ecosystem.

On the financial front, Meta India continued to witness healthy growth, although the economic downturn slowed down the momentum. The Indian arm of social media major, Facebook India Online Services, recorded a net profit of INR 352 Cr in FY23, up 19% year-on-year (YoY), against gross advertisement revenue of INR 18,308 Cr, up 13% YoY.

To fuel its operations and build goodwill with the Centre, the company also announced several partnerships and accelerator initiatives with the government to mentor Indian startups, especially in emerging areas such as mixed and extended reality.

Meta In 2024: Gazing Into The Crystal Ball

With more digital laws expected to be promulgated in India in 2024, the company could be headed down a rough road as it looks to balance growth with regulations.

“If GDPR (General Data Protection Regulation) repercussions are anything to go by, India and Indian laws might have similar implications for Meta.  A case in point being the DPDP Act which, just like GDPR, has a requirement on the use of data from minors. Given that there are roughly 500 Mn Indians below the age of 18, it opens up a lot of exposure for Meta if they’re not compliant with the new law,” added IDfy’s Ashok Hariharan.

Meanwhile, emerging challenges such as GenAI could put a spanner in the works for the company even as compliance demands surge from authorities.

Notwithstanding this, India continues to be one of the biggest markets for Meta globally, accounting for more than 1 Bn users across three apps — Facebook, Instagram and WhatsApp. 

Walking on a regulatory tightrope in India, Meta’s India journey so far this year has been both bitter and sweet. Now, with global headwinds expected to ease and consumption likely to surge next year, Meta could put its Indian ambitions in full throttle in 2024. 

The post On A Regulatory Tightrope: Here Is How Meta India’s Odyssey Unfolded In 2023 appeared first on Inc42 Media.

After the funding peak of 2021, when valuations of dozens of startups skyrocketed far away from their actual revenue, it seemed that a profitable startup was rarer than a unicorn.

But the sobering reality of the past two years has given unicorns and soonicorns of India a lot to think about. And primarily, their thoughts turned to one big question: How do we get to profitability?

Several startups have managed to answer this question in FY23 and even the likes of Zomato have turned the course around. What explains this new phase for Indian startups and tech giants?

We’ll look to get the answer about the profitable startup brigade in India, but after a brief detour into these top stories from this past week:

• Omidyar Hits The Eject Button: Omidyar Network, one of the oldest active VC firms in India, is exiting the market. Did the firm’s legal problems with regulators force its hand?
• Groww’s Super App Year: Groww thinks like a D2C company and looks at problems from a consumer-first perspective, says cofounder Harsh Jain as he gives us a peek into how the fintech giant is looking beyond investment tech
• Decoding CRED’s 2023: This was a big year for CRED — embracing the platform life with multiple new and revamped products, and proving that financially too, it is on the right track with its FY23 numbers

Startups Don The Profitability Hat

When we last looked at the financial state of Indian unicorns in March this year, as many as 55 out of 74 Indian unicorns who had released their FY22 numbers were in losses. Their combined loss of $5.9 Bn in FY22 was almost double their cumulative loss in FY21.

While losses are not new in any way, the fact that investor sentiment was turning sour meant that startups had to focus on generating cash from their business rather than relying on VC funding to expand and grow. In other words, VC money was used to widen the top of the funnel, but when the tap is turned off startups have to find a way to get more revenue from the users they have acquired.

“VCs have always wanted startups to monetise and generate free cash flow, but the reality of the market was such that startups needed scale to make this possible. They relied on funding to grow their cache of users and are now looking to capitalise on this base,” Naganand Doraswamy, founder of early-stage VC firm Ideaspring Capital, told us.

Doraswamy, who founded Ideaspring in 2016, claims that this is how tech has grown in the Silicon Valley ecosystem, too. He pointed out that India is going through the phase, which Silicon Valley saw in the late 90s when a few startups emerged and are now tech giants after three decades.

The Profitable Startup Brigade

Other investors believe that if anything, India is maturing faster and profitability is part of the maturity curve. Even younger startups are turning profitable faster because they are focussing on profits and not scale, says the cofounder of a Mumbai-based micro VC firm.

But a lot of this has to do with the sector and segment that the startup operates in. It’s not possible to eke out profits in ecommerce in the first two or three years, but in fintech or enterprise tech, this is very much a possibility.

B2B models are better suited to churn out profitable startups, especially if factors like customer segmentation and product-market fit are right. And this is particularly true for startups that are targeting small businesses, where the TAM is still high and untapped.

B2C startups still need to spend to acquire users but those which did this in the past two years are reaping the rewards. Take Groww for instance, which turned profitable on a base of 6.5 Mn+ users. In a conversation with Inc42, Groww claims that profitability is an outcome of its product, other B2C companies still have to focus sharply on their revenue modelling and reducing customer acquisition costs.

Who Gets The Credit?

But who is to be credited for this change in the outlook among startups? Is it just that investors wanted startups to focus on profits, or to put it differently, would this change have been possible without the global economic slowdown, tight liquidity and the funding winter?

As investors tightened their purse strings, realisation struck that they needed to focus on their bottom lines to extend their runways and get fresh funding. This resulted in the start of restructuring exercises across startups through layoffs and cutbacks.

The fact is that a clear and short path to profitability is a condition for growth capital in 2023, so perhaps this phase would not have come without market conditions. There’s been a flurry of claims by startups around profitability, which is meant to perhaps act as a lure for investors. Startups have relied on vastly different terminologies and parameters for profitability — from profit after tax to EBITDA and adjusted EBITDA to profit as of a single month or the most recent quarter.

“We know many of the larger investors are also stipulating milestone-based tranches for investing in startups. Most startups that have raised large rounds this year have to have demonstrated their path to profitability or the potential for an exit in the next couple of years,” the Mumbai-based investor added.

Exits are, of course, on the cards for many investors with IPOs plans being revived in 2024 and 2025. Listed companies face the most visible pressure from investors to show profits and in Zomato’s case, the profitability has come after a decade of fine-tuning the revenue structure and charging customers directly per order. The rationalising of costs associated with Blinkit’s quick commerce model has also helped Zomato in a major way.

Zomato’s two profitable quarters show that the company has capitalised on the revenue momentum in FY24 and seems poised to become a profit-making machine.

Will The Tide Turn? 

Of course, it’s too early to say whether the profitability streak of FY23 will continue in 2024 and 2025. Like many have pointed out, the profits are in many cases a result of startups slowing down expansion of operations and user base. The focus has instead shifted to maximising revenue. Will Indian startups be back to their loss-making ways if and when they have to scale both revenue and users?

“It’s very much possible that startups go back to their old ways, but one thing is that those which need VC money will know that investor confidence can shift on a dime and if you don’t show the results there are a lot of questions, like in the case of BYJU’s today,” according to a Bengaluru-based edtech cofounder and CEO.

There’s also a feeling among startups that profits are possible without raising mega rounds, especially because talent costs have been rationalised. In addition, startups are replicating the business strategies that are working — Zomato and Swiggy’s platform fees and commission changes this year, for example.

One potential issue for startups that just focus on profits is that they might find their profits stagnating in the long run. “It’s a tricky balance. This year is about profits, but perhaps next year many companies will reinvest this profit into growing and expanding. And then the market will be asking questions about how long before they hit profits again,” the founder quoted above observed.

Profitability is also on the agenda for startups looking to get listed in 2024 and 2025. Showing profits before the listing is a recipe for a successful IPO, and it’s a motivation for the likes of OYO, Swiggy, PayU among others.

Startups go through cycles all the time. This year, startups are in the midst of a market that demands they show profits, but perhaps this expectation will change next year. And if so, will startups forget some of the hard lessons that brought them to profits in the first place?

In Focus: 2023 In Review 

Our wrap of the year continues with a flurry of stories on everything from the most controversial stories and personalities of the year to taking a look at the state of layoffs in the ecosystem.

• Swiggy vs Zomato: While Zomato has grown into a profitable entity, has it managed to outperform Swiggy among consumers in 2023? Here are the results of our survey of the consumer sentiments for these two food delivery giants
• Layoffs Outlook For 2024: After 35,000+ job cuts in 2022 and 2023, will the forthcoming year bring a positive change when it comes to startup layoffs and cutbacks?
• Startups Caught In Controversies: From boardroom battles at BharatPe to founders deceived at a startup event to financial mismanagement at VC-backed first, here’s what brought startups to the headlines for the wrong reasons
• Founders Start Up Again: More than 30 CXOs, including founders, have switched their tracks to float new ventures or join other companies in pursuit of new opportunities. What explains this transition?

Sunday Roundup: Startup Funding, Tech Stocks & More

• Funding Galore: Bright sparks for startup funding this week, with over $527 Mn raised by Indian startups across 21 deals
• Krutrim AI: Bhavish Aggarwal’s latest venture Krutrim has unveiled new large language models and a chatbot, claiming to be “India’s first full-stack AI”
• Alma Better: From a cash crunch to layoffs and opaque performance reviews, upskilling startup Alma Better’s story has gone from promising to problematic
• Grok In India: Elon Musk’s OpenAI and ChatGPT challenger Grok is now available in India for X Premium+ users

• SoftBank’s Sell Streak: Japanese major SoftBank offloaded 2.53% of its stake in Policybazaar this week after its exit from Zomato

We’ll be back next week with another roundup as we close the curtains on 2023.

Don’t forget to stay tuned to our social media channels during this time of the year. Join Inc42 on Instagram, X/Twitter and LinkedIn for the latest news as it happens.

The post Startups In Their Profitability Era appeared first on Inc42 Media.

It has been a year of oxymorons for the Indian startup land and its incumbent. While the year was mostly bogged down in the extended wave of an unforgiving funding dry spell (aka the infamous funding winter), it also saw a spring of Indian founders rolling out their second or even third ventures.

It is imperative to mention that the year so far has seen more than 30 CXOs, including founders, switch their tracks to join other companies, float new ventures or assume new roles within existing companies. 

While many stepped down under mysterious circumstances or took an exit after their ventures were acquired or for various other reasons, the zeal of Indian founders to start afresh cannot be ignored.  

Interestingly, the trend of entrepreneurs not sticking to one particular venture in the world’s third-largest startup ecosystem is not new but became more evident with examples like Ola cofounder Ankit Bhati quitting the ride-hailing giant to focus on his SaaS venture Amnic.

The past few years have also seen eminent entrepreneurs like Kunal Shah (Freecharge to CRED), Jitendra Gupta (Citrus Pay to Jupiter), Anant Goel (Milkbasket to Sorted), et al. raise funds to start their new ventures.

However, one may ask if this trend is having any particular impact on the world’s third-largest startup ecosystem, especially investors. 

According to industry experts, investors tend to have more confidence in second and third-time founders, making them preferred choices for investment. And there is a simple explanation for this  — such entrepreneurs are already well-versed in the industry cycles and the rules of the game.

As far as the realm of the Indian startup ecosystem is concerned, such founders are more likely to succeed, without relying much on vanity metrics like valuations, and mentor new breeds of entrepreneurs entering the domain.

As we inch towards embracing new hopes for the Indian startup ecosystem with the year 2024 in sight, let’s steal a glance at some of these founders who started up again.

8 Founders Who Started Up Again In 2023

Dineout’s Cofounder Vivek Kapoor Marked His Healthtech Foray

This year, Dineout cofounder Vivek Kapoor left Swiggy to join Delhi-based healthcare financing startup AyushPay as its cofounder and chief business officer. 

The transition was also triggered by his desire to make a meaningful contribution to the Indian healthtech sector. Notably, he was AyushPay’s angel investor for a considerable period and had actively mentored the AyushPay team.

AyushPay (formerly known as DoctCo), a healthcare solutions provider, announced his appointment in July.

Founded in 2021 by Nimith Aggarwal and Col Hemraj, AyushPay provides financing and payment solutions to patients to make healthcare accessible and affordable. 

Kapoor became part of Swiggy’s leadership team after Dineout’s acquisition by Times Internet last year at a valuation of $150 Mn-$200 Mn. 

Anshuman Kumar Left Teachmint For The Love Of His Dating App

In a bid to focus on his new venture Duolop, a dating and relationship management app, Teachmint’s cofounder and CTO Anshuman Kumar quit the edtech startup in March.

“I am stepping into a new role as the founder of Duolop, a dynamic and innovative Indian app revolutionising how couples connect and grow together,” Kumar announced about his exit in a LinkedIn post.

Duolop is an app for couples, both married and unmarried, which aims to simplify the complexities of managing a relationship. It offers a private chat feature where couples can send messages, images and videos to each other and help them plan dates.

The app has already been launched on the Google Play and Apple Stores.

Founded in 2020 by Kumar, Mihir Gupta, Payoj Jain and Divyansh Bordia, Teachmint helps teachers and schools digitise their classrooms. The startup counts Lightspeed India, Rocketship.vc and Better Capital as among its marquee investors.

In November 2022, Teachmint laid off 45 employees or around 5% of its workforce. The startup’s net loss skyrocketed 24X to INR 131.70 Cr in FY22 from INR 5.52 Cr in FY21, while its operating revenue stood at INR 77.45 Lakh.

Zolostay’s Akhil Sikri Set Sail For A New Expedition

Akhil Sikri, cofounder of Zolostays, stepped away from his operational role at the coliving startup to pursue his new entrepreneurial venture.

In August, Sikri, along with his fellow directors Ketan Kapoor and Ayon Dutta, floated Quick Response Financial Technologies Pvt. 

The Bengaluru-based Quick Response engages in activities encompassing computer programming, consultancy and related services.

As per Sikri’s LinkedIn profile, he transitioned out of his active role at Zolostays in March. However, he continued to retain his position on the company’s board. His LinkedIn bio lists him as the cofounder of an upcoming, unnamed project.

Launched in 2015 by Sikri, along with Isha Choudhry, Nikhil Sikri and Sneha Choudhry, Zolostays offers affordable paying guest accommodations, service apartments and independent flats to students and working professionals via its AI-powered app.

The startup competes with the likes of Isthara and Stanza Living, among others.

On A New Adventure, GoMechanic’s Cofounders Deny To Throw In The Towel

Automobile after-sale services startup GoMechanic’s cofounders Rishabh Karwa and Nitin Rana stepped down from their roles after admitting to financial misreporting.

The story began in January this year, when GoMechanic cofounder Amit Bhasin, who continues to be associated with the startup as per his LinkedIn profile, admitted to committing “errors in judgement” regarding financial reporting while trying to pursue growth. 

While the dust is far from settled on the GoMechanic front, Karwa and Rana joined the list of founders starting up again.

Both of them are now working on two separate and unnamed new startups. 

Not much details are known about Rana’s new startup, except that his latest venture focusses on “Building Travel & Hospitality Product for Indian Subcontinent and World”.

However, Karwa has been quite vocal about starting anew, posting about the journey of building a new product and startup. His social media posts about Figma plugins and projects indicate some degree of progress. As per his LinkedIn profile, he is “building for local businesses”.

Both Karwa and Rana have not publicly announced raising any funds for their new startups till now. Now, it remains to be seen if the controversies around GoMechanic change anything for their new ventures. 

Polygon’s Cofounder Is Now The Captain Of Two New Ventures

In October, Polygon cofounder Jaynti Kanani resigned from his position at the blockchain scaling platform to focus on his new opportunities.

As per Kanani’s LinkedIn profile, he has cofounded two new startups – Mozak and Morphic. 

While Morphic is developing a platform designed to assist creators, filmmakers, and animators in producing high-quality content using AI technology, not many details are available for Mozak except that it is a Web3 platform. 

“After kickstarting Polygon in 2017, around six months back, I decided to step back from the day-to-day grind,” Kanani said in a post on X while announcing his decision to quit.

His LinkedIn profile shows that he served as the cofounder of Polygon until March 2023. 

Kanani is said to have stepped down from Polygon around the same time when the company undertook mass layoffs earlier this year. In February, the blockchain scalability platform culled 20% of its workforce as part of a restructuring exercise amid the ongoing crypto winter.

ShareChat’s Cofounders Quit To Incorporate A Robotics Startup

After quitting their first venture ShareChat in January, cofounders Bhanu Pratap Singh and Farid Ahsan established their second venture, General Autonomy, in May this year.

In November, the cofounders raised $3 Mn in seed funding from venture capital firms India Quotient and Elevation Capital for the robotics startup, General Autonomy.

Before leaving ShareChat, Singh also served as its CTO, while Ahsan held the COO’s role. The third ShareChat founder, Ankush Sachdeva, continues to be the CEO of the social media unicorn.

The cofounders’ exit coincided with ShareChat’s parent firm, Mohalla Tech, laying off 20% of its workforce or 500 individuals earlier in the year.

Founded in 2015, parent Mohalla Tech positions ShareChat as an Indic language social media platform. In 2022, it acquired Times Internet-owned social short-video platform MX TakaTak for over $600 Mn to foray into the competing short-video social space. 

Mohalla Tech’s loss jumped 38.17% year-on-year to INR 4,064.31 Cr in FY23, while operating revenue grew 62% to INR 540.21 Cr.

The post 8 Indian Startup Founders Who Started Up Again In 2023 appeared first on Inc42 Media.

In a landscape teeming with buzzwords like disruption, innovation and scalability, the stark reality of numbers often tells a different story. While 87 leading new-age tech companies in India have released their FY23 financials, the performance figures offer a cautionary tale. 

Despite a cumulative operating revenue of a staggering INR 1.97 Lakh Cr, 60 of these companies reported a combined loss of INR 38,933.6 Cr in FY23. In contrast, the rest managed to eke out a collective profit of INR 5,675 Cr. The divide becomes more intriguing considering that 19 of these companies are listed. 

We are over eight months into FY24, but a majority of Indian startups are yet to release their financial numbers for FY23, leaving many to wonder what lies beneath the surface. In the ongoing fiscal year, Inc42’s Indian Startup Financials Tracker FY23 aims to be your eyes and ears, updating you on the financial performance of startups.

It’s important to note that FY23 was far from smooth sailing for the Indian startup ecosystem. Faced with dwindling funding, startups resorted to mass layoffs. In addition, various Indian startups adopted restructuring measures, including elimination of some business units and reductions in marketing budgets, to navigate the downturn.

While the capital crunch was painful and humbling, it also pushed startups to control their expenditure and focus on profitability. As such, FY23 financials are more than numbers. They reveal how Indian tech companies navigated the funding winter and showed resilience while continuing to push for growth. Now, let’s delve deeper into the financial performance of Indian startups.

Editor’s Note: This list is not a ranking of any kind, we have placed companies alphabetically. This is a running list; we will be updating it periodically.

Inside The FY23 Financials Of Indian Startups

Note: All amount in INR Cr

Acko’s FY23 Loss Jumps To INR 739 Cr

Bengaluru-based fintech unicorn Acko saw its operating revenue rise 32% to INR 1,758.6 Cr in FY23 as compared to INR 1,334.4 Cr in the previous year. Loss jumped over 50% to INR 738.5 Cr during the year under review as against INR 482.3 Cr in the previous fiscal year. Earlier this year, the startup received the licence from the Insurance Regulatory and Development Authority of India (IRDAI) to commence life insurance business.

Read: Acko Earned INR 1,759 Cr By Selling Insurance In FY23

Apna’s Revenue Jumps 3X

Tiger Global-backed professional networking platform Apna’s revenue from operations surged nearly 3X to INR 180.2 Cr in FY23 from INR 63.8 Cr in the previous fiscal year. 

The startup incurred a loss of INR 120.3 Cr in FY23, an increase of 7% from INR 112.5 Cr in FY22.  The Nirmit Parikh-led startup’s total expenses also rose 73% to INR 308.4 Cr in FY23 from INR 178.3 Cr in the previous fiscal year.

Read: Tiger Global-Backed Apna’s FY23 Revenue Nearly Triples To INR 188 Cr

Atlan’s Profit Takes A Hit

Data collaboration software startup Atlan reported a profit after tax (PAT) of INR 7.74 Cr in FY23, a decline of 18.70% from INR 9.52 Cr in FY22.

The Salesforce-funded startup’s operating revenue rose 189.78% to INR 93.83 Cr from INR 32.38 Cr in FY22

Total expenses jumped 203.45% to INR 85.53 Cr in FY23 from INR 28.19 Cr in FY22.

Read: SaaS Startup Atlan’s Profit Slips 19% To INR 7.74 Cr In FY23

Ather Energy’s Revenue Quadruple In FY23

Bengaluru-based two-wheeler electric vehicle (EV) manufacturer Ather Energy’s operating revenue jumped 4.3X to INR 1,783.6 Cr in FY23 from INR 408.5 Cr in the previous fiscal year. Despite this, the Hero MotoCorp-backed startup’s net loss surged over 150% to INR 864.5 Cr from INR 344.1 Cr in FY22. 

The two-wheeler EV manufacturer’s total expenses more than tripled to INR 2,670.6 Cr from INR 757.9 Cr in FY22

Read: Ather Energy’s Loss Shoots Up 2.5X To INR 865 Cr IN FY23

BankBazaar’s Loss Falls 15% To INR 37 Cr

Fintech startup BankBazaar’s net loss narrowed over 15% to INR 36.71 Cr in FY23 from INR 43.23 Cr in the fiscal year ended March 2022. The startup’s operating revenue stood at INR 158.69 Cr in FY23, up from INR 95.52 Cr in FY22.  

Eight Roads-backed BankBazaar’s total expenditure zoomed 40% YoY to INR 196.93 Cr in FY23.

Read: BankBazaar Trims FY23 Loss By 15% As Top Line Jumps 66% To INR 158.69 Cr

Beardo Slips Into The Red, Posts INR 6.1 Cr Loss In FY23

Marico-owned men’s grooming D2C brand Beardo slipped into the red during the financial year under review. The Ahmedabad-based D2C brand reported a net loss of INR 6.1 Cr in FY23 as against a net profit of INR 75.5 Lakh in the previous fiscal year. 

Beardo’s revenue from operations rose 12.3% to INR 106.6 Cr in FY23 from INR 94.8 Cr in FY22, as per Marico’s annual report for the year ended March 31, 2023.

Total expenditure stood at INR 115.3 Cr in FY23, a rise of 20% from INR 96.1 Cr in FY22. 

Read: Marico-Owned Beardo Slips Into The Red, Posts INR 6.1 Cr Loss In FY23

BigBasket Crosses INR 16,000 Cr Revenue Mark 

Tata-owned BigBasket reported a total revenue of INR 16,903 Cr in FY23, a jump of 8.4% from INR 15,593 Cr in the previous fiscal year. 

The combined B2C and B2B business of BigBasket incurred a net loss of INR 3,320 Cr in the financial year 2022-23 (FY23), a 79% increase from INR 1,853 Cr reported in the previous fiscal year.

BigBasket spent INR 770 Cr for advertisement and promotional expenses during the year under review.

Read: BigBasket B2C Arm’s Net Loss Surges 89% To INR 1,535.2 Cr In FY23

Bira 91’s Sales Inch Closer To INR 1,000 Cr Mark

Delhi NCR-based beer brand Bira 91 reported an operating revenue of INR 824.3 Cr in the year ended March 31, 2023, an increase of 15% from INR 718.8 Cr in the previous fiscal year. 

Bira 91’s net loss increased 12% to INR 445.4 Cr in FY23 from INR 396 Cr in the previous fiscal year. Total expenditure increased 14% to INR 1,282.4 Cr during the year under review from INR 1,122.5 Cr in FY22.

Read: Bira 91 Incurred Loss Of INR 445 Cr From Sales Of Beers In FY23

BlueStone’s Expenses Dip 45%

Jewellery startup BlueStone’s operating revenue increased over 1.6X to INR 770.7 Cr in FY23, an increase of 67% from INR 461.3 Cr in the previous fiscal year. 

The startup’s loss plunged 86% to INR 167.2 Cr from INR 1,268.4 Cr in FY22 on account of a one-time non-operating expense in the previous fiscal year. The jewellery startup’s total expense declined 45% to INR 955.1 Cr in FY23 from INR 1,739 Cr in FY22. 

The startup is in the process to raise $65 Mn from Nikhil Kamath’s office, Deepinder Goyal, Amit Jain, and Ranjan Pai

Read: Ratan Tata-Backed BlueStone Earned INR 771 Cr By Selling Jewellery In FY23

boAt Slips Into The Red For First Time Since Inception

Aman Gupta-led consumer electronics startup boAt slipped into the red for the first time since its inception as the increase in its expenses outpaced the rise in sales. boAt reported a net loss of INR 129.4 Cr in FY23 after posting a profit of INR 68.7 Cr in FY22.

Operating revenue rose 18% to INR 3,376.7 Cr from INR 2,873 Cr in the previous fiscal year.

The startup earned INR 2,350.8 Cr in FY23 from the audio segment, which accounted for 70% of its operating revenue. The wearable segment contributed INR 901.5 Cr to boAt’s topline this year.

Total expenses jumped 28% to INR 3,562 Cr in FY23 from INR 2,786.9 Cr in the previous fiscal year.

Read: Aman Gupta’s boAt Sold Audio Products, Smartwatches Worth INR 3,376 Cr In FY23

BookMyShow Turns Profitable After COVID

Online ticketing platform BookMyShow turned profitable and posted a consolidated net profit of INR 85.1 Cr in FY23 as against a loss of INR 92.2 Cr in the previous fiscal year.

As more people stepped out and went to movie theatres and attended live events post the Covid-19 pandemic, the startup’s operating revenue surged 252% to INR 975.5 Cr in FY23 from INR 277 Cr in the previous fiscal year. 

BookMyShow’s total expenses also jumped 138% to INR 940.9 Cr in FY23 from INR 395.2 Cr in the previous financial year

Read: BookMyShow Posts INR 85 Cr Profit In FY23 On Post-Pandemic Boost, Sales Jump 3X

CaratLane’s Sales Cross INR 2,000 Cr Mark

Titan-owned jewellery startup CaratLane’s operating revenue surged 73% to INR 2,169 Cr in FY23 from INR 1,255.6 Cr in the previous fiscal on the back of growing demand.

Despite the rise in revenue, CaratLane’s net profit dipped 8% to INR 82 Cr during the year under review from INR 89.2 Cr in the previous fiscal year.
Total expenditure jumped 69% to INR 2,068.5 Cr in FY23 from INR 1,225.9 Cr in the previous fiscal year.

Read: Titan-Owned CaratLane’s FY23 Sales Jump To INR 2,169 Cr, Profit Dips To INR 82 Cr

CarTrade Back In The Black In FY23

CarTrade, which recently acquired OLX’s India business, returned in the black in the financial year ended March 31, 2023. The Rajasthan-based startup reported a net profit of INR 40.4 Cr in FY23 as compared to a loss of INR 121.3 Cr in the previous year. 

Operating revenue rose around 16% to INR 363.7 Cr in FY23 from INR 312.7 Cr. 

The auto marketplace also reported an over 300% rise in profit after tax at INR 13.5 Cr in the first quarter of the financial year 2023-24 (FY24) from INR 3.3 Cr posted in the year-ago quarter. 

Read: CarTrade’s PAT Jumps 4X YoY To INR 13.5 Cr In Q1

Amazon-Backed Cashify’s Revenue Crosses INR 800 Cr Mark

Delhi NCR-based recommerce startup Cashify’s sales jumped 67% to INR 815.9 Cr during FY23 from INR 497.9 Cr in the previous fiscal year. 

Despite the rise in revenue, Cashify’s net loss increased in FY23. Its net loss grew 49% to INR 147.9 Cr during the year under review from INR 99.3 Cr in FY22.

The Amazon-backed startup saw its expenditure grow 61% to INR 973.4 Cr in FY23 from INR 603.1 Cr in the previous fiscal year.

Read: Cashify Earned INR 816 Cr By Selling Refurbished Phones, Laptops In FY23

Classplus’ FY23 Loss Widens To INR 257 Cr

The Tiger Global-backed edtech startup’s net loss rose 57% to INR 256.6 Cr in FY23 from INR 163.5 Cr in FY22. Operating revenue jumped 4X to INR 102.04 Cr in FY23, compared to INR 25.9 Cr in the previous year.

Earlier this year, Classplus faced legal trouble when Saarthi’s cofounder, Chiraag Kapil, and its investors filed a lawsuit against it in the Delhi High Court (HC) for alleged cheating and criminal breach of trust.

Read: Tiger-Backed Classplus Spent INR 4 To Earn Every INR 1 From Ops In FY23

Clear’s Revenue Crosses INR 100 Cr Mark

Peak XV Partners-backed Clear’s (formerly known as ClearTax) operating revenue jumped over 85% to INR 108.8 Cr in the financial year 2022-23 (FY23) from INR 58.7 Cr in FY22.

Despite the increase in revenue, the startup’s net loss grew nearly 5% to INR 233.5 Cr in FY23 from INR 222.7 Cr in FY22.

Total expenditure increased over 21% to INR 343.7 Cr from INR 283 Cr in FY22.

Read: Tax Filing Platform Clear’s FY23 Revenue Jumps Over 85% To Cross INR 100 Cr Mark

Flipkart-Owned Cleartrip’s Loss Doubles 

Flipkart-owned online travel aggregator Cleartrip witnessed a 90% surge in its loss to INR 676.5 Cr in FY23 from INR 356.5 Cr in the previous financial year. The startup’s operating revenue declined 10% to INR 50 Cr, whereas expenses jumped 63% to INR 773.2 Cr in the financial year. On a unit economics level, the startup spent INR 15 to earn every INR 1 from its operations. 

Read: Flipkart Owned Cleartrip Spent INR 15 To Earn Every INR 1 From Ops In FY23

Kunal Shah’s CRED’s Revenue Jumps 250% In FY23

Kunal Shah-led fintech unicorn CRED’s total revenue jumped over 3.5X in the financial year ended March 31, 2023 to INR 1,484 Cr from INR 422 Cr in the previous fiscal year. 

While the loss grew 5% to INR 1,347.4 Cr in FY23 from INR 1,279.5 Cr in the previous fiscal year, the startup’s total expenditure jumped 1.6X to INR 2,831.9 Cr in FY23 from INR 1,702.1 Cr.

CRED, which is known for splurging on advertisements, reduced its marketing costs by 26% to INR 713.4 Cr from INR 975.7 Cr in FY22.

Read: Kunal Shah-Led CRED’s Revenue Jumps 3.5X To INR 1,484 Cr In FY23

Darwinbox’s Loss Jumps To INR 158 Cr

HRtech unicorn Darwinbox’s consolidated net loss soared 2.4X to INR 158.25 Cr in FY23 from INR 65.72 Cr in the previous fiscal year.

The Microsoft-backed startup’s operating revenue almost doubled to INR 224.04 Cr in FY23 from INR 116.73 Cr in FY22. 

The SaaS-based startup’s total expenses soared 2.2X to INR 407.22 Cr in FY23 from INR 186.93 Cr in the previous fiscal year.

Read: HRtech Unicorn Darwinbox’s FY23 Loss Surges 2.4X To INR 158 Cr

Delhivery Sees Meagre Uptick In Revenue

Logistics company Delhivery saw a 5% YoY jump in operating revenue in the financial year ended March 31, 2023. The Lee Fixel-backed startup reported an operating revenue of INR 7,225.3 Cr in the financial year under review as compared to INR 6,882.2 Cr it had reported in the previous quarter. 

The startup also reported a loss of INR 1,007.7 Cr in FY23, a 0.3% dip as compared to the loss of INR 1,011 Cr it had reported in the previous year. 

However, the logistics startup reported almost a 78% decline in net loss at INR 89.5 Cr in the first quarter of FY24 from INR 399.3 Cr reported in the last year’s quarter.

Read: Delhivery’s Q1 Loss Narrows 78% YoY To INR 89.5 Cr On Strong Growth Across Verticals

DroneAcharya Witnesses 700% Jump In Profit

Of the listed companies, Pune-based drone startup Droneacharya reported the highest jump in profit on a YoY basis. The company reported a profit of INR 3.4 Cr in FY23, a jump of over 700% from INR 0.4 Cr it had reported in the previous fiscal. 

The startup’s operating revenue also increased by over 429% to INR 18.5 Cr in FY23 as compared to INR 3.5 Cr it had reported in the previous fiscal year. 

Read: DroneAcharya’s FY23 Profit Jumps Over 700% YoY To INR 3.42 Cr On Increase In Offerings

Dunzo’s Loss Quadruples

Reliance-backed Dunzo’s loss nearly quadrupled in the financial year ended March 31, 2023. The Bengaluru-based hyperlocal delivery startup’s loss surged to INR 1,801 Cr in FY23 from INR 464 Cr in the previous fiscal year. 

Meanwhile, operating revenue increased 317% to INR 226.6 Cr in FY23 from INR 54.3 Cr in FY22. The startup’s total expenses ballooned 286% to INR 2,054.4 Cr in FY23 from INR 531.7 Cr in the previous fiscal year

Read: Dunzo Spent INR 9 To Earn Every Single Rupee From Operations In FY23

EaseMyTrip Nears INR 500 Cr Mark in Sales

Prashant, Nishant, and Rikant Pitti-led online travel aggregator – EaseMyTrip – reported a 91% jump in operating revenue in the year under review. The Delhi-NCR-based startup reported an operating revenue of INR 448 Cr in FY23, an almost 2X jump from INR 235.3 Cr it had posted. EaseMyTrip also reported a profit of INR 134 Cr in FY23, a 27% jump from INR 106 Cr it had reported in the previous fiscal.

However, the startup’s profit declined by 22% YoY to INR 26 Cr in the first quarter of financial year 2023-24 (FY24).

Read: EaseMyTrip’s Q1 PAT Declines 22% YoY To INR 25.9 Cr On Deep Discounts

ElasticRun’s Revenue Cross INR 4,000 Cr Mark

Softbank-backed logistics unicorn ElasticRun’s revenue from operations saw a YoY increase of 24.71% to INR 4,754.86 Cr from INR 3,812.65 Cr in FY22. Further, the total revenue saw a YoY increase of 26.71% to INR 4,851.09 Cr from INR 3,828.24 Cr in the previous fiscal.

However, the startup loss nearly doubled to INR 618.82 Cr from INR 358.59 Cr in FY22. 

ElasticRun’s total expenditure surged 30.65% YoY to INR 5,469.91 Cr from INR 4,186.66 Cr in FY22.

Read: SoftBank-Backed ElasticRun’s FY23 Loss Doubles To INR 619 Cr

Flipkart’s B2B Arm’s Loss Jumps 42%

Flipkart India, the B2B arm of Flipkart, saw its standalone net loss balloon over 42% to INR 4,845.7 Cr in FY23 from INR 3,404.3 Cr in FY22. 

Operating revenue increased a mere 9.7% to INR 55,923.9 Cr in FY23 from INR 50,992.5 Cr in the previous fiscal year.  Total expenses rose 11.5% to INR 60,858.5 Cr in FY23 from INR 54,580 Cr in FY22.

Read: Flipkart’s B2B Arm’s FY23 Loss Surges 42% To INR 4,846 Cr

SaaS Unicorn Fractal Posts INR 194 Cr Profit 

New York-based AI intelligence unicorn Fractal turned profitable in FY23, posting a profit of INR 194.4 Cr as against a loss of INR 148.4 Cr in FY22. 

Operating revenue increased 53% to INR 1,985.4 Cr in FY23 from INR 1,295.3 Cr in the previous fiscal year. Total expenditure surged 52% to INR 2,225.2 Cr from INR 1,461.5 Cr in the previous fiscal year. 

Read: Exceptional Gain Helps SaaS Unicorn Fractal Post INR 194 Cr Profit In FY23

Fino Reports 50% PAT Jump In FY23

Mumbai-based Fino reported a 166% increase in its operating revenue to INR 95 Cr in FY23 as compared to INR 35.6 Cr it had reported in the previous fiscal year. The payments bank further reported a 52% increase in net profit to INR 65 Cr in FY23 as compared to INR 42.7 Cr it had reported in the previous financial year. 

The payments bank reported an 85% YoY jump in its profit after tax (PAT) to INR 18.7 Cr in the June quarter (Q1) of the financial year 2023-24 (FY24) as compared to a PAT of INR 10.1 Cr on a revenue of INR 289 Cr in Q1 FY23.

Read: Fino Payments Bank’s Q1 PAT Jumps 85% YoY To INR 18.7 Cr; To Apply For Small Finance Bank Licence

Groww Turns Profitable In FY23

Bengaluru-based stock broking platform Groww’s parent entity Billionbrains Garage Private Limited turned profitable in the financial year ended March 31, 2023. It reported a net profit of INR 448.7 Cr in FY23 as against a net loss of INR 239 Cr in the previous fiscal year. 

Operating revenue jumped over 3X to INR 1,277.8 Cr in FY23 from INR 351 Cr in the previous fiscal year. Groww’s expenses increased by a muted 41% to INR 932.9 Cr in FY23 from INR 663.6 Cr in the previous fiscal year

Read: Groww’s Revenue Crosses INR 1,000 Cr Mark, Posts Profit Of INR 449 Cr In FY23

HealthifyMe’s Loss Dips

Healthtech startup HealthifyMe saw its total loss decline by around 10% to INR 142 Cr in FY23, down from INR 157 Cr reported in the year-ago fiscal. 

Meanwhile, total revenues from operations rose 23% to INR 228.7 Cr in FY23 from INR 185.25 Cr in FY22. Total expenditure stood at INR 371.72 Cr during FY23, up 8.23% YoY.

Read: HealthifyMe’s Revenue Cross INR 200 Cr Mark, Losses Dip 10% In FY23

HomeLane’s Net Loss Jumps Over 15% 

Home interior startup HomeLane witnessed a 1.1X increase in net loss in the financial year ended March 31, 2023. The Bengaluru-based startup reported a net loss of INR 173.5 Cr in the financial year 2022-23 (FY23), a 15% increase from INR 150.8 Cr in FY22. 

The MS Dhoni-backed startup saw its total expenses increase over 1.3X to INR 757.2 Cr in FY23 from INR 581.7 Cr in the previous fiscal year. 

Read: HomeLane’s Loss Widens 15% To INR 173.5 Cr In FY23

ideaForge’s Profit Dips In FY23

Listed in 2023, drone manufacturing startup ideaForge saw its profit drop in the financial year ended March 31, 2023. The company reported a 28% drop in profit to INR 32 Cr in FY23 from INR 44 Cr it had reported in the previous fiscal year. 

The Mumbai-based startup’s operating revenue rose 17% to INR 186 Cr in FY23 from INR 160 Cr it had reported in the previous fiscal year. 

Moreover, in the first quarter of the ongoing fiscal year, the company saw over 50% decline in profit to INR 18.9 Cr as compared to INR 41.2 Cr it had reported in the corresponding quarter last year. 

Read: ideaForge’s PAT Declines 54% YoY To INR 18.9 Cr In Q1

iD Fresh Food’s Loss Halves In FY23

Ready-to-cook food maker iD Fresh Food’s net loss narrowed over 50% in FY23. The Bengaluru-based startup, which sells idli batter and parota, incurred a loss of INR 328.8 Cr in FY23, a 53% decline from INR 703.7 Cr in the previous year. 

Operating revenue increased 26% to INR 479.2 Cr during the year under review from INR 381.6 Cr in FY22. The startup’s expenses grew 14% to INR 517.1 Cr in FY23 from INR 453.9 Cr in the previous fiscal year. 

Read: iD Fresh Food Earned INR 479 Cr By Selling Idli & Dosa Batter In FY23

IndiaMART Nears INR 1,000 Cr In Sales

The only new-age publicly listed ecommerce marketplace, IndiaMART, witnessed a slight improvement in its revenue in the financial year ended March 31, 2023. Dinesh Agarwal-led B2B ecommerce marketplace reported an operating revenue of INR 985.3 Cr in FY23, a 31% increase from INR 753.4 Cr it reported in the previous fiscal year.  

The company’s profit dipped around 5% to INR 283.8 Cr in FY23 as compared to INR 298 Cr it had reported in the previous fiscal year. 

In Q1 FY24, it reported a consolidated revenue of INR 282.1 Cr, up 25.65% YoY. 

Read: IndiaMART At 52-Week High Following Q1 Results

Indifi In The Black In FY23

Lendingtech startup Indifi Technologies turned profitable in the financial year ended March 31, 2023. The Delhi NCR-based startup reported a net profit of INR 5.1 Cr in FY23 as compared to a loss of INR 32.8 Cr in FY21. 

Revenue from operations jumped over 2X to INR 197.9 Cr in FY23 from INR 96.29 Cr in the previous fiscal year. 

The startup’s total expenditure stood at INR 202.8 Cr in FY23, an increase of 1.4X from INR 138.4 Cr in the previous fiscal year. 

Read: Alok Mittal Led Indifi Reports INR 5.1 Cr Profit In FY23

INDMoney’s Operating Revenue Doubles 

Investment tech startup INDmoney reported a 7.7% rise in its net loss to INR 73.9 Cr in FY23 from INR 68.6 Cr in the previous fiscal year.

The startup’s operating revenue  increased to INR 40.6 Cr during the year from INR 21.8 Cr in FY22.

INDmoney’s overall spending grew 1.5X to INR 200 Cr in FY23 from INR 133.4 Cr in the prior fiscal year. 

Read: INDmoney’s FY23 Net Loss Widens To INR 73.9 Cr, Revenue More Than Doubles

Info Edge In The Red In FY23, Revenue Crosses INR 2,000 Cr Mark

Sanjeev Bikhchandani-led Info Edge, the first Indian internet company to go public, reported a 47.6% jump in operation revenue to INR 2,345.7 Cr in FY23 from INR 1,589 Cr it had reported the previous year. However, the company slipped in the red in FY23. 

The parent entity of Naukri.com reported a net loss of INR 70.4 Cr in FY23 as against a net profit of INR 1,288.2 Cr in FY22. It must be noted that Info Edge wrote off investment worth INR 276 Cr in Rahul Yadav led 4B Network during this period. 

However, it reported a profit of INR 147.4 Cr in the first quarter of FY24. 

Read: Info Edge Back In The Black With INR 147.4 Cr Net Profit In Q1

InsuranceDekho Narrows Loss To INR 51.5 Cr 

InsuranceDekho, the insurance arm of CarDekho, managed to narrow its net loss by 29% to INR 51.5 Cr in FY23 from INR 72.2 Cr in FY22, on the back of a strong growth in its business.

The Haryana-based insurtech startup’s operating revenue doubled to INR 96.4 Cr during the year under review from INR 47.9 Cr in the previous fiscal year. The startup’s total expenses rose 25% to INR 151.8 Cr from INR 121 Cr in FY22

Read: InsuranceDekho’s Net Loss Narrows 29% To INR 51.5 Cr In FY23

Jar Spent INR 16 To Earn Every Rupee

Fintech startup Jar’s loss increased 77% to INR 122.8 Cr in FY23 from INR 69.5 Cr in FY22.

The Bengaluru-based investment tech startup’s revenue from operations jumped to INR 8.7 Cr in FY23 from INR 73.8 Lakh a fiscal ago. 

The Tiger Global-backed startup’s expenses doubled to INR 137.5 Cr in FY23 from INR 70.3 Cr in FY22.

Read: Tiger Global-Backed Jar Spent INR 16 To Earn INR 1 In FY23

Jupiter Spent INR 54 To Earn Every Rupee

Neobanking soonicorn Jupiter Money’s loss jumped over 2X to INR 327 Cr in FY23 from INR 156.3 Cr in the previous fiscal, hurt by a sharp jump in its employee benefit expenses.

The Jitendra Gupta-led startup reported an astronomical increase in revenue to INR 7.1 Cr from a mere INR 40 Lakh it had reported in the previous year. The startup’s FY23 expenses increased 115% to INR 383 Cr in FY23 from INR 178 Cr in FY22.

Read: Neobank Jupiter Spent INR 54 To Earn Every Rupee In FY23

Justdial’s Profit More Than Doubles In FY23

Reliance-acquired hyperlocal search engine Justdial reported a 130% jump in profit in the financial year ended March 31, 2023. The Mumbai-based company reported a net profit of INR 162.7 Cr in FY24, a 2.2X increase from INR 71 Cr it had reported in the previous financial year. 

The company reported an operating revenue of INR 844.7 Cr in FY23, a 30.5% increase from INR 647 Cr it had reported in the previous year. 

Even in the first quarter of the ongoing financial year, the company reported a net profit of INR 83.4 Cr, a 72% increase from INR 48.4 Cr it had reported in the corresponding quarter of previous fiscal year. Operating revenue stood at INR 247 Cr in Q1 FY24.

Read: Justdial’s User Traffic Crosses 17 Cr Mark In Q1, Posts Record Revenue Of INR 247 Cr

LEAD School’s Loss Narrows 

Mumbai-based edtech startup LEAD School’s net loss declined 18.5% to INR 321.9 Cr in FY23 from INR 395.3 Cr in FY22 on strong growth in business and reduction in cash burn.

The startup’s revenue from operations increased by more than 2X to INR 273.1 Cr in FY23 from INR 132.3 Cr in the previous fiscal year, as per its filing with the Ministry of Corporate Affairs.

Total expenses increased over 14.7% to INR 617.4 Cr in FY23 from INR 538.1 Cr in FY22. 

Read: LEAD School’s FY23 Loss Narrows 18.5% to INR 322 Cr

Licious Narrows Loss By 38% To INR 529 Cr

Bengaluru-based meat delivery startup Licious witnessed a marginal rise of 9.5% in its operating revenue to INR 748 Cr in FY23 from INR 682.5 Cr in the previous fiscal year.

Meanwhile, the startup managed to decrease its net loss by over 38% to INR 528.5 Cr in FY23 from INR 855.6 Cr in the previous year due to reduction in its cash burn. 

Licious’ total expenses rose 9.8% to INR 1,309.2 Cr in FY23 from INR 1,191.4 Cr in the previous fiscal year. 

Read: Licious Sold Meat Worth INR 748 Cr In FY23 But Growth Plateau

Mamaearth Slips Into The Red 

IPO-bound D2C unicorn Mamaearth slipped into the red with a net loss of INR 151 Cr in FY23 as against a net profit of INR 14.4 Cr in the previous fiscal year on the back of a one-time loss of INR 155 Cr.

The startup reported an operating revenue of INR 1,492.7 Cr in FY23, a jump of 58% from INR 943.4 Cr in the previous fiscal year. Total expenditure surged 59% to INR 1,501.6 Cr in FY23 from INR 942 Cr in the previous year, in line with the increase in its operating revenue.

Read: Goodwill Impairment Hits IPO-Bound Mamaearth, Posts INR 151 Cr Loss In FY23

MapmyIndia’s Profit Crosses INR 100 Cr Mark

Geotech startup MapmyIndia saw a 40% jump in operating revenue to INR 281.4 Cr in the financial year ended March 31, 2023 from INR 200 Cr in the previous fiscal year. Besides increase in operating revenue, the startup reported a jump of 32% in profit on a YoY basis to INR 107.5 Cr in FY23. 

In Q1 FY24, it reported a 32.2% YoY rise in consolidated net profit to INR 32 Cr.

Read: MapmyIndia Q1 Net Profit Zooms 32.2% YoY To INR 32 Cr

Matrimony Sees Dip In Profit In FY23

Indian online matchmaking site Matrimony saw its profit after tax slip 13% to INR 46.6 Cr in  FY23 from INR 53.5 Cr in the previous financial year. The matrimonial site’s operating revenue rose just 5% to INR 455.7 Cr in FY23 from INR 434.4 Cr in the previous fiscal year.

Matrimony saw a 18% increase in profit to INR 4.16 Cr in the first quarter of FY24 as against INR 11.95 Cr it had reported in the corresponding quarter in previous year. 

Read: Matrimony’s Q1 PAT Rises 18% YoY To INR 14 Cr

MediBuddy’s Loss Crosses INR 300 Cr Mark

Bengaluru-based healthtech startup MediBuddy’s net loss widened 24% to INR 321.7 Cr in FY23 from INR 259.3 Cr in the previous fiscal year.

The operating revenue of the startup, founded by Satish Kannan and Enbasekar Dinadayalane, grew 27.2% to INR 297.7 Cr during the year under review from INR 234.1 Cr in FY22.

MediBuddy’s total expenses jumped over 30% to INR 648.9 Cr in FY23 from INR 497.4 Cr in the previous year, with the cost of materials consumed being the single biggest contributor at 35%.

Read: MediBuddy’s FY23 Loss Jumps 24% To INR 321.7 Cr As Business

Fintech Giant MobiKwik Narrows Loss To INR 83.8 Cr

Delhi NCR-based fintech unicorn MobiKwik’s net loss fell 35% in the financial year ended March 31, 2023. The startup reported a net loss of INR 83.8 Cr in FY23 as against a loss of INR 128.1 Cr in the previous fiscal year. 

While the startup reduced its expenditure to INR 617 Cr in FY23 from INR 652.5 Cr in the previous fiscal year, MobiKwik’s operating revenue remained almost flat at INR 539.4 Cr in FY23. 

Read: MobiKwik’s FY23 Loss Declines 35% To INR 84 Cr, Operating Revenue Flat

Moglix’s Revenue Crosses INR 4,000 Cr Mark

Rahul Garg’s B2B ecommerce startup Moglix reported an operating revenue of INR 4,664.7 Cr in FY23, a jump of 83% from INR 2,554.6 Cr in the previous year. The Bengaluru-based startup saw its loss increase 12% to INR 196 Cr from INR 175.3 Cr in FY22. Total expenditure jumped 80.5% to INR 4,941 Cr in FY23 from INR 2,736.8 Cr in FY22. 

Earlier this year, the Tiger Global-backed startup laid off around 40 employees. 

Read: Moglix FY23 Revenue Jumps To $560 Mn, Founder Sells Shares Worth $10 Mn

Nazara’s Sales Zooms Past INR 1,000 Cr Mark

Nitish Mittersain-led gaming company Nazara Technologies saw a sharp increase in revenue in the financial year ending on March 31, 2023. The Mumbai-based technology company reported an operating revenue of INR 1,091 Cr in the financial year under review, a 75% jump from INR 621.7 Cr it had reported in the previous year. Profit jumped 21% to INR 61.4 Cr from INR 50.7 Cr in FY22. 

In the first quarter of FY24, the company saw its operating revenue jump to 14% to INR 254.4 Cr during the quarter under review from INR 223.1 Cr in the year-ago quarter.

In Septmeber 2023, the gaming giant also raised INR 510 Cr from Zerodha founders and SBI Mutual Fund.

Read: Nazara Tech’s Q1 Net Profit Soars 31% YoY To INR 20.9 Cr

NeoGrowth Turns Profitable In FY23

Mumbai-based non-banking financial company (NBFC) NeoGrowth turned profitable in the financial year ended March 31, 2023. The NBFC reported a profit of INR 17.2 Cr in FY23 as against a net loss of INR 39.4 Cr in FY22. 

The Lighrock-backed NBFC reported an operating revenue of INR 380.8 Cr in FY23, a meager 5.3% increase from INR 361.5 Cr in the previous year. Meanwhile, it saw a 13.7% decline in expenses to INR 357.4 Cr from INR 414.5 Cr in FY22. 

Read: NeoGrowth In The Black In FY23, Posts Profit Of INR 17.2 Cr

Noise Profits Takes A Plunge

Gurugram-based bootstrapped startup Noise saw its profit nosedive to INR 88 Lakh in the financial year 2023-23 (FY23) from INR 35.5 Cr a year ago.

However, the startup’s operating revenue jumped 1.8X to INR 1,426.5 Cr in FY23 from INR 792.8 Cr in FY22. 

The smartwatch and earphone manufacturer’s expenses surged 1.9X to INR 1,431.6 Cr in FY23 from INR 752.6 Cr in FY22. 

Read: Noise’s FY23 Revenue Soars Past INR 1,400 Cr, But Profit Fails To Create A Buzz On Rising Expenses

Nykaa Reports 50% Dip In Profit In FY23

Beauty fashion giant Nykaa, which listed on the bourses in 2021, reported an operating revenue of INR 5,143.8 Cr in FY23, a 36% increase from INR 3,773.9 Cr it had reported in the previous fiscal year. 

The Falugni Nayar-led ecommerce startup saw its profit dip by around 50% to INR 21 Cr in the year under review as compared to INR 41 Cr it had reported in the previous fiscal year.

Employee benefit expenses jumped to INR 492 Cr in FY23 from INR 326.4 Cr in FY22. Of late, the company has also seen several top-level exits.

However, the Mumbai-based company posted a net profit of INR 5.4 Cr in Q1 FY24 as compared to a profit of INR 5 Cr in the same quarter of previous fiscal year. 

Read: Nykaa Q1: Net Profit Rises 8% YoY To INR 5.4 Cr

OfBusiness’ Revenue Crosses INR 15,000 Cr Mark

Delhi NCR-based B2B marketplace OfBusiness’ revenue from operation crossed the INR 15,000 Cr mark in FY23. The unicorn marketplace reported an operating revenue of INR 15,342.5 Cr in FY23, an increase of 115% from INR 7,139.5 Cr in the previous fiscal year.

Net profit surged 130% to INR 463.2 Cr in FY23 from INR 201.1 Cr in the previous fiscal year. 

Total expenditure more than doubled to INR 15,037.4 Cr during the year under review from INR 6,993.5 Cr in FY22

Read: OfBusiness Posts INR 463 Cr Profit In FY23, Revenue Crosses INR 15,000 Cr Mark

OneCard’s Operating Income Jumps 6X

Credit card startup OneCard reported a 6X increase in its operating revenue to INR 541.1 Cr in FY23 from INR 83.7 Cr in the previous fiscal year. 

Meanwhile, loss more than doubled to INR 405.6 Cr in FY23, an increase of 122% from INR 182.7 Cr in FY22. 

Total expenditure rose 3.5X to INR 999.5 Cr in FY23 from INR 280.6 Cr in the previous fiscal year. 

Read: Fintech Unicorn OneCard Spent 60% Of Its Operating Revenue On Advertising In FY23

Oxyzo’s Profit Triples In FY23

Fintech unicorn Oxyzo’s profit after tax almost tripled to INR 197.5 Cr in the financial year ended March 31, 2023 from INR 69.3 Cr in the previous financial year. 

Oxyzo’s revenue from operations increased by over 82% to INR 570 Cr in FY23 from INR 313 Cr in the previous financial year. 

The company also reported a 1.7X jump in employee benefit expense to INR 78 Cr in FY23 from INR 46 Cr in the previous year. 

Read: Fintech Unicorn Oxyzo’s FY23 PAT Jumps Over 2.8X To INR 198 Cr

OYO’s Loss Declines 34% To INR 1,287 Cr 

IPO-bound hospitality unicorn OYO reported a 34% decrease in its net loss to INR 1,286.5 Cr in FY23 from INR 1,941.5 Cr in the previous fiscal year, as expenses declined marginally despite growth in business. 

The SoftBank-backed startup’s operating revenue grew 14% to INR 5,463.9 Cr in FY23 from INR 4,781.3 Cr in the previous fiscal year. Total expenditure fell 3% to INR 6,799.6 Cr from INR 6,985.3 Cr in the previous fiscal year. 

Read: IPO-Bound OYO’s Loss Declines 34% To INR 1,287 Cr In FY23

Paper Boat’s Sales Cross INR 500 Cr Mark

Hector Beverages, the parent company Paper Boat, saw its net loss widen 71% to INR 90.6 Cr in the financial year FY23 from INR 53 Cr in FY22.

The juice maker’s loss widened, despite it crossing the INR 500 Cr mark in sales for the first time. The startup’s sales rose 56% to INR 504 Cr during the year under review from INR 324 Cr in FY22.

Paper Boat’s total expenses rose to INR 599.1 Cr in FY23 from INR 378.1 Cr in the previous fiscal year.

Read: Paper Boat’s FY23 Loss Surges 71% To INR 90.6 Cr, Revenue Crosses INR 500 Cr Mark

PayMate Manages To Narrow Its Loss

IPO-bound B2B payments solutions provider PayMate managed to narrow its consolidated net loss by a marginal 3.5% to INR 55.7 Cr in FY23 from INR 57.7 Cr in the previous fiscal year. On the other hand, operating revenue rose 11.7% to INR 1,350.1 Cr in FY23 from INR 1,208.9 Cr in FY22.

The fintech startup’s total expenses increased 11% to INR 1,407.3 Cr during the year under review from INR 1,266.9 Cr in FY22. In that, the cost of materials accounted for a significant 95%.

Read: IPO-Bound PayMate’s FY23 Loss Narrows Marginally To INR 55.7 Cr

Paytm’s FY23 Loss Drops By 26%

Vijay Shekhar Sharma-led Paytm improved its financial performance in FY23. The Delhi NCR-based fintech giant reported a 1.6X jump in operating revenue at INR 7,990.3 in FY23 from INR 4,974.2 Cr in the previous fiscal year. 

Its net loss also reduced 26% to INR 1,766.5 Cr in FY23 from INR 2,396.4 Cr in the previous fiscal year. 

Even in the first quarter of FY24, the startup reported a revenue of INR 2,342 Cr, a 39% jump from INR 1,680 Cr it reported in the previous quarter.

Read: Paytm Q1 Net Loss Declines 45% YoY To INR 358.4 Cr But Jumps 113% QoQ

PB Fintech’s Operating Revenue Jumps To INR 2,558 Cr

Mumbai-based insurtech startup PB Fintech saw its operating revenue jump over 80% to INR 2,557.8 Cr in FY23 from INR 1,425 Cr in the previous fiscal year. Despite the startup’s advertisement expense jumping 1.6X to INR 1,357 Cr in FY23, PB Fintech reduced its net loss by 41.4% to INR 488 Cr from INR 832.9 Cr in FY22. 

In the first quarter of FY24, the startup managed to reduce its loss by over 94% to INR 11.9 Cr from INR 204 Cr in the year-ago quarter.

Read: PB Fintech’s Q1 Net Loss Narrows 94% YoY To INR 11.9 Cr

Porter’s FY23 Revenue Crosses INR 1,700 Cr Mark

Intra-city logistics service provider Porter reported a 2X jump in operating revenue on a YoY basis in the financial year ended March 31, 2023. The Tiger Global-backed startup reported an operating revenue of INR 1,753.5 Cr in the year under review as against INR 847.6 Cr in the previous fiscal year. 

Porter’s net loss jumped over 43% to INR 157.7 Cr in FY23 as compared to INR 122 Cr in the previous year. The startup, which has raised $132 Mn in funding so far, spent INR 185 Cr on employee benefit expenses, a 75% increase from INR 106 Cr in the previous year. 

Read: Logistics Startup Porter’s Operating Revenue Doubles To INR 1,753 Cr In FY23

Purplle’s Sales Inches Closer To INR 500 Cr Mark

Beauty ecommerce marketplace Purplle’s operating revenue more than doubled to near the INR 500 Cr mark during the year ended March 31, 2023. The startup’s operating revenue or sales stood at INR 474.9 Cr in FY23, an increase of 116% from INR 219.8 Cr in FY22. 

Despite the rise in operating revenue, Purplle’s net loss grew 13% to INR 230 Cr from INR 203.6 Cr in FY22. 

The startup’s total expenditure grew 71% to INR 738.3 Cr from INR 431.2 Cr in FY22.

Read: Purplle’s FY23 Sales Inch Closer To INR 500 Cr Mark, Loss Widens To INR 230 Cr

RapiPay’s Loss Doubles In FY23

After raising $15 Mn in 2022, fintech startup RapiPay saw its net loss jump over 2X in the financial year ended March 31, 2023. The Noida-based startup incurred a net loss of INR 93.3 Cr in FY23 as against a loss of INR 40 Cr in the previous financial year. The significant rise in startup’s loss could be attributed to an increase in service and commission charges, which grew to INR 360.8 Cr in FY23 from INR 322.2 Cr in the previous year.

The startup’s revenue from operations also rose to INR 439.2 Cr in FY23 as compared to INR 371.4 Cr in the previous fiscal year. 

Read: Fintech Startup RapiPay’s Net Loss Jumps 2.3X To INR 93.3 Cr In FY23

RateGain’s Profit Jumps Over 700%

Traveltech SaaS startup RateGain reported a whopping 714% jump in profit to INR 68.4 Cr in FY23 from INR 8.4 Cr in the previous fiscal year. The Delhi NCR-based company saw its revenue from operations jump over 54% to INR 565 Cr from INR 366 Cr in FY22. 

In Q1 FY24, the company tripled its profit after tax to INR 24.9 Cr from INR 8.4 Cr in the previous year. The company reported an 80% YoY increase in operating revenue to INR 214.5 Cr in Q1 FY24.

Read: RateGain Q1 PAT Almost Triples YoY To INR 24.9 Cr On Robust Travel Demand

Recykal Slips Into The Red 

Morgan Stanley-backed waste management marketplace Recykal slipped into the red in FY23, reporting a net loss of INR 25.7 Cr as against a net profit of INR 1.2 Cr in FY22. 

However, the Hyderabad-based startup’s operating revenue jumped 291% to INR 745.1 Cr in FY23 from INR 190.4 Cr in the previous fiscal year. 

Read: Morgan Stanley-Backed Recykal Slips Into The Red, Posts INR 25.7 Cr Loss In FY23

Rupeek’s Loss Declines 23% 

Gold loan startup Rupeek reported a 22.7% narrowed loss of INR 281.6 Cr in FY23 from INR 364.4 Cr in FY22. The Bengaluru-based startup’s revenue from operations dropped 27.7% to INR 88.9 Cr in FY23 from INR 122.9 Cr in FY22.

Total expenses fell one-fourth to INR 376.9 Cr in FY23 from INR 499.4 Cr in the previous fiscal year.

Read: Fintech Startup Rupeek’s FY23 Loss Declines 23% To INR 282 Cr, Sales Slide 28%

Pine Labs-Owned Setu’s Loss Jumps Over 100%

Bengaluru-based fintech startup Setu’s FY23 net loss jumped 118% year-on-year (YoY) to INR 62 Cr. The startup’s operating revenue increased 22% to INR 14.2 Cr from INR 11.6 Cr a fiscal ago.

The fintech startup’s overall expenditure rose by over 77% to INR 79.6 Cr during the year under review from INR 44.9 Cr it spent in the previous fiscal year. 

Read: Pine Labs Owned Setu Spent INR 5.6 To Earn Every Rupee In FY23

Servify’s Operating Revenue Almost Doubles

Device management startup Servify’s net loss narrowed to INR 229.1 Cr in FY23 from INR 2,860.8 Cr posted in the previous fiscal, helped by a sharp decline in non-operating expenses.

Servify’s operating revenue almost doubled to INR 313 Cr during the year under review from INR 611.2 Cr in FY22.

The startup reported an over 73% decline in its total expenses to INR 846.7 Cr in FY23 from INR 3,176.4 Cr the previous year.

Read: Decline In Non-Operating Expenses Helps Servify Narrow FY23 Loss Over 90% To INR 229 Cr

ShareChat’s Loss Crosses INR 5,000 Cr Mark

India’s indigenous social media platform ShareChat saw its loss increase to INR 5,144 Cr in FY23 on the back of amortisation expenses due to the acquisition of MX Taka Tak. In FY22, the startup’s loss stood at INR 2,988.6 Cr in FY22.

ShareChat’s revenue from operations increased 59% to INR 552.7 Cr in FY23 from INR 346.9 Cr in FY22.

The startup’s total expenses increased 72% to INR 5,862.1 Cr in FY23 from INR 3,407.5 Cr

Read: Google Backed ShareChat’s Losses Ballooned To INR 4,064 Cr In FY23 

Shiprocket’s Revenue Crosses INR 1,000 Cr Mark

Zomato-backed logistics unicorn Shiprocket’s revenue from operations increased over 78% to INR 1,088.8 Cr in FY23 from INR 610.5 Cr on the back of its acquisition spree.

The startup’s loss increased over 425% to INR 333.8 Cr during the year under review from INR 63.6 Cr in the previous fiscal year.

On the expenses front, the Saahil Goel-led startup spent a total INR 1,397 Cr in FY23 as against INR 697.8 Cr it had spent in FY22.

Read: Shiprocket’s FY23 Revenue Crosses INR 1,000 Cr Mark, Reports 3.6X Surge In Loss

Spacetech Startup Skyroot’s Loss Doubles 

Indian spacetech startup Skyroot Aerospace saw its standalone net loss widen to INR 55.2 Cr in FY23 from INR 23.7 Cr in the prior fiscal year.

While the startup’s operating revenue rose to INR 44 Lakh in FY23 from INR 1.5 Lakh in the previous year, its expenses surged to INR 63 Cr during the year under review from INR 24 Cr in FY22.  

Read: Skyroot Aerospace’s FY23 Net Loss Jumps Over 2X To INR 55 Cr

Tata 1mg’s Sales Cross INR 1,600 Cr Mark

The online pharmacy, owned by the Tata Group, saw its net loss jump over 2X to INR 1,254.8 Cr in FY23 from INR 526 Cr in FY22. 

However, operating revenue jumped over 2.6X to INR 1,627 Cr in FY23 from INR 627 Cr it reported in the previous fiscal year. Unlike most startups, Tata 1mg reduced its marketing expenditure by 25% to INR 135 Cr in FY23 from INR 180 Cr in FY22. 

Read: Tata 1mg’s Net Loss Soars 2.3X To INR 1,259 Cr In FY23

Testbook’s Loss Almost Triples In FY23

Government job test prep startup Testbook’s loss surged 2.7X to INR 129.8 Cr in FY23 from INR 48 Cr in FY22.  The Mumbai-based startup’s revenue from operations rose 59% to INR 56.1 Cr in FY23 from INR 35.2 Cr in the previous fiscal year. 

Testbook’s expenses rose a whopping 2.2X to INR 186.7 Cr during the year under review from INR 81.4 Cr in the previous year, with employee benefit expenses climbing 200% to INR 95 Cr from INR 31.8 Cr in FY22. 

Read: Testbook Spent INR 3.3 To Earn Every Rupee From Operations In FY23

Tracxn Reports Profit In FY23

The Bengaluru-based market intelligence startup turned profitable in the financial ending on March 31, 2023. In FY23, Tracxn reported a net profit of INR 33 Cr as opposed to a net loss of INR 4.4 Cr it had reported in the previous fiscal year. Tracxn’s operating revenue stood at INR 78.1 Cr, a 23% increase from INR 63.4 Cr it reported in the previous fiscal year. 

However, Tracxn’s net profit declined 18% to INR 0.69 Cr in Q1 FY24 from INR 0.84 Cr in the year-ago quarter. 

Read: Tracxn’s Q1 Net Profit Halves QoQ To INR 69 Lakh, Revenue Slips 2.5%

True Balance’s Profit Jumps Over 17X 

Softbank-backed digital payments and lending platform True Balance saw its profit jump over 17X in the financial year 2022-23 (FY23). The Delhi NCR-based fintech startup reported a net profit of INR 59 Cr in the year under review, a 1,600% jump from INR 3.4 Cr it reported in the previous fiscal year. 

True Elements’ Spent INR 84 Cr To Earn INR 57 Cr

Marico-owned healthy snacks brand True Elements’ net loss jumped 37% to INR 18.6 Cr in FY23 from INR 13.6 Cr in FY22. 

While the startup’s operating revenue saw a 25% jump to INR 57.3 Cr in FY23 from INR 45.8 Cr in FY22, expenditure increased over 44% to INR 84.2 Cr in FY23 from INR 58.4 Cr in the previous fiscal year. The startup’s biggest expenses, cost of materials consumed, increased over 43% to INR 36.5 Cr in FY23 from INR 25.5 Cr.

Read: True Elements Spent INR 84 Cr To Earn INR 57 Cr From Selling Healthy Snacks In FY23

Udaan’s FY23 Revenue Declines 43%

Bengaluru-based B2B ecommerce startup Udaan’s operating revenue declined 43% to INR 5,609.3 Cr in FY23 from INR 9,897.3 Cr in the previous fiscal year. Its net loss also fell 33.5% to INR 2,076 Cr in FY23 from INR 3,123.4 Cr in the previous fiscal year.

As per some media reports, Udaan is in discussions to raise around $250 Mn in  fresh round of funding. 

Read: Udaan’s Operating Revenue Drops 43% To INR 5,609 Cr In FY23

Unicommerce’s Profit Inches Up 

IPO-bound SaaS startup Unicommerce’s operating revenue zoomed 52% to INR 90 Cr in the financial year 2022-23 from INR 59 Cr in the previous fiscal year on strong demand for its services.

This resulted in the SoftBank-backed startup’s net profit rising 8% to INR 6.4 Cr in FY23 from INR 5.9 Cr in FY22.

The startup’s overall expense rose 55% to INR 84.1 Cr in FY23 from INR 54.4 Cr in the previous fiscal year.

Read: IPO-Bound Unicommerce Posts INR 6.4 Cr Profit In FY23, Revenue Nears INR 100 Cr Mark

Uniphore’s Net Profit Quadruples

Uniphore, one of the few profitable unicorns, saw its net profit rise further in FY23. The startup’s profit jumped over 4X to INR 142.7 Cr in FY23 from INR 33.4 Cr in FY22. This was the second consecutive profitable year for the startup after it reported a net loss of INR 281.8 Cr in FY21. 

However, operating revenue fell 28% to INR 488.4 Cr and overall expenses also dropped 29% to INR 492.7 Cr in FY23. 

Read: Uniphore’s FY23 Profit Quadruples To INR 143 Cr As Revenue From India Soars 272X

upGrad’s Loss Jumps Past INR 1,000 Cr Mark

Mumbai-based edtech unicorn upGrad’s net loss surged 76% to INR 1,141.5 Cr in the financial year 2022-23 (FY23) from INR 648.2 Cr in the previous fiscal year.

The startup’s bottom line took a hit due to goodwill writedown of INR 410 Cr despite its operating revenue crossing the INR 1,000 Cr mark. The Ronnie Screwvala-led startup reported an operating revenue of INR 1,169.6 Cr in FY23, an increase of 97% from INR 595 Cr in the previous fiscal year.

The startup’s overall expenses increased 56% to INR 1,938 Cr from INR 1,241 Cr reported in the previous fiscal year.

Read: upGrad’s FY23 Loss Surges To INR 1,141.5 Cr On Goodwill Writedown Of INR 410 Cr

Urban Company’s Employee Expenses Drops 15%

Delhi NCR-based consumer service startup Urban Company saw its net loss drop by 39% to INR 312.4 Cr in FY23 from INR 514 Cr in the previous fiscal year. The Dragonner-backed unicorn reported a net operating revenue of INR 636.5 Cr in FY23, a 45% jump from INR 437 Cr it had reported in the previous financial year. 

Interestingly, the company reduced its employee benefit expenses by 15% to INR 377 Cr in FY23 from INR 443.8 Cr in the previous fiscal year. Since the beginning of this year, the startup has been facing a series of protests from its partners over permanent blocking of their IDs due to a sudden increase in the required customer rating to continue working with the platform.

 Read: Urban Company’s India Biz Achieves Adjusted EBITDA Breakeven In Q1 FY24

Wakefit’s Operating Revenue Crosses INR 800 Cr Mark

D2C furniture and mattress startup Wakefit’s net loss widened by 37% to INR from INR 107 Cr in the previous fiscal year. 

Revenue from operations increased 28% to INR 813 Cr during the year under review from INR 632.5 Cr in the previous fiscal year.  Total expenses grew 30% to INR 965.6 Cr in FY23 from INR 743.5 Cr in the previous fiscal year.

Read: After Spending INR 96 Cr On Advertising, Wakefit Incurs INR 146 Cr Loss In FY23

Xpressbees’ Loss Surges Over 6X 

Logistics unicorn Xpressbees’ net loss widened over 500% to INR 180.4 Cr in FY23 from INR 27.1 Cr in FY22. Operating revenue increased a mere 1.3X to INR 2,531.5 Cr during the year under review from INR 1,904.4 Cr in FY22.  

The TPG-backed startup’s total expenses grew 42% to INR 2,784.7 Cr in FY23 from INR 1,957.1 Cr in the previous fiscal year. 

Read: Logistics Unicorn Xpressbees’ FY23 Loss Surges Over 500% To INR 180 Cr

Yulu’s Loss Inches Closer To INR 100 Cr Mark

Emobility startup Yulu saw its consolidated net loss widen 71% to INR 94.9 Cr in FY23 from as against INR 55.5 Cr in FY22.

The cleantech startup’s operating revenue rose to INR 41.7 Cr, a 43.8% from INR 29 Cr it reported in the previous fiscal year. 

Yulu reported a total expenditure of INR 140.1 Cr in FY23, a sharp 60.5% increase from INR 87.3 Cr spent in the prior fiscal.

Read: Yulu’s FY23 Net Loss Widens 71% To INR 94.9 Cr As Business Expands

Zepto’s Revenue Suprasses INR 2,000 Cr Mark

Zepto, the latest entrant to the unicorn club, reported an operating revenue of INR 2,024.3 Cr in FY23, a 14X increase from INR 140.7 Cr in the previous fiscal year.

At the same time, the startup’s loss soared 3.2X to INR 1,272.4 Cr from INR 390 Cr in FY22.

Total expenses stood at INR 3,350 Cr in FY23 as against INR 532.7 Cr in the previous year.

Read: Zepto’s FY23 Revenue Jumps 14X To INR 2,078 Cr, Loss Triples To INR 1,272 Cr

Kamath Brothers’ Led Zerodha’s Revenue Inches Closer To INR 7,000 Cr Mark

Bootstrapped stock-broking platform Zerodah, led by Nithin and Nikhil Kamath, reported a total income of INR 6,875 Cr in FY23, an increase of 38% from INR 4,964 Cr in the previous fiscal year. 

The Bengaluru-based unicorn, which is valued at $3.6 Bn, saw its net profit jump 39% to INR 2,907 Cr from INR 2,094.3 Cr in FY22.

Read: Zerodha’s FY23 Net Profit Rises To INR 2,907 Cr As Revenue Nears INR 7,000 Cr Mark

Zomato’s Loss Under INR 1,000 Cr

Delhi NCR-based food delivery giant saw its consolidated revenue surge over 68% to INR 7,079.4 Cr during the year under review. In the previous financial year, the startup had reported an operating revenue of INR 4,192.4 Cr. Zomato, which completed the acquisition of quick commerce delivery startup Blinkit in FY23, saw its net loss drop by 20.5% to INR 971 Cr in FY23 from INR 1,222.5 Cr in FY22. 

In the first quarter of FY24, the startup reported an operating revenue of INR 2,416 Cr as against INR 1,413.9 Cr in Q1 FY23. The startup also reported its first-ever profitable quarter. It posted a consolidated profit after tax (PAT) of INR 2 Cr in Q1 as against a consolidated net loss of INR 186 Cr in the corresponding quarter of the previous fiscal. 

Read: Zomato Turns Profitable, Reports INR 2 Cr PAT In Q1

Edited By: Vinaykumar Rai
Last Updated: 16th December, 17:30 PM IST

The post Indian Startup FY23 Financials Tracker: Tracking The Financial Performance Of Top Startups appeared first on Inc42 Media.

A total of 71 founders of 42 new-age tech companies in India took home INR 228.4 Cr in annual salaries in the financial year 2022-23 (FY23)!

The average founder annual salary rose marginally to INR 3.30 Cr in FY23 from INR 2.86 Cr in FY22.

This comes at a time when the ongoing funding winter has brought about a significant transformation in the country’s startup ecosystem, compelling startups to focus on profitability. This also meant cutting down cash burn, which resulted in companies taking aggressive cost-cutting measures, including pay cuts and layoffs.

According to Inc42’s layoff tracker, Indian startups have laid off more than 29,000 employees since the onset of the funding winter in 2022. 

While these drastic measures helped some startups turn profitable or reduce their losses, most of the startups are still bogged down by losses.

While 41 companies (excluding Lenskart) out of the aforementioned 42 reported a total operating revenue of INR 75,809 Cr in FY23, 23 of them incurred a combined loss of INR 17,615 Cr.

Amid all these, it’s natural for one to ask that if the employees are losing their jobs and taking pay cuts, have the founders of the new-age tech companies also seen a decrease in their remunerations? To answer this question and keep our readers up to date with the remunerations earned by the founders, Inc42 has launched the ‘Founder Salaries FY23 Tracker’. 

The tracker will keep you informed about the remuneration earned by the founders in FY23, the percentage increase/decrease in their salaries compared to FY22, and more.

Editor’s Note: This list is not a ranking of any kind, we have placed companies alphabetically. This is a running list and will be updated periodically. 

Founder Remuneration Tracker FY23

Companies are placed in alphabetical order | Data has been sourced from MCA filings, annual reports, and DRHPs | The remuneration Includes salary, wages, & bonus

*NOTE: Includes, salary, wages, & bonus

Nithin & Nikhil Kamath | Zerodha

Nithin and Nikhil Kamath, the cofounders of bootstrapped stock broking platform Zerodha, took home INR 48 Cr each in annual salaries in FY23, making them the highest paid founders in this list as of now. However, their remuneration remained unchanged from the previous fiscal year even as Zerodha’s net profit increased 37% to INR 2,909 Cr. Its total revenue inched closer to the INR 7,000 Cr mark during the year under review.

Ritesh Agarwal | OYO

OYO’s Ritesh Agarwal is currently second on the list. In FY23, Agarwal took home INR 12 Cr in remuneration, representing a 114% hike from INR 5.6 Cr withdrawn in FY22. It must be noted that while Agarwal’s compensation more than doubled during the year, the unicorn fired nearly 600 employees in FY23.

OYO reported a 34% decline in its net loss to INR 1,286.5 Cr in FY23 from INR 1,941.5 Cr in the previous fiscal year. The SoftBank-backed startup’s operating revenue grew 14% to INR 5,463.9 Cr in FY23 from INR 4,781.3 Cr in FY22. 

Deepak Singh Ahlawat | Gameskraft

Deepak Singh Ahlawat, the cofounder of Gameskraft, received one of the biggest hikes among the list of the cofounders featured in this list. His annual remuneration jumped 264.6% to INR 10.1 Cr in FY23 from INR 2.77 Cr in the previous fiscal year.

The startup’s revenue from operations jumped 24.8% to INR 2,662.5 Cr in FY23 from INR 2,133.1 Cr in FY22, while profit rose 14.2% to INR 1,061.9 Cr in FY23 from INR 930.4 Cr in FY22.

Manish Taneja | Purplle

Manish Tanjea and Rahul Dash, the cofounders of beauty ecommerce startup Purplle, took home INR 6.71 Cr each in remuneration in FY23, a hike of 527% from INR 1.07 Cr each they got in the previous fiscal year.

The startup’s operating revenue or sales stood at INR 474.9 Cr in the financial year 2022-23 (FY23), an increase of 116% from INR 219.8 Cr in FY22. Loss grew 13% to INR 230 Cr from INR 203.6 Cr in FY22.

Nitish Mittersain | Nazara Technologies

Nitish Mittersain, CEO and cofounder of publicly listed Nazara Technologies, was one of the highest-paid founders in the year under review. Mittersain took home INR 4 Cr as remuneration in FY23. His remuneration increased 21% from INR 3.3 Cr he earned in the previous fiscal year. 

Meanwhile, the Mumbai-based company reported an operating revenue of INR 1,091 Cr in FY23, a jump of 75% from INR 621.7 Cr in the previous fiscal year. Net profit rose 21% to INR 61.4 Cr from INR 50.7 Cr in FY22. 

Vijay Shekhar Sharma | Paytm

Vijay Shekhar Sharma, the founder of Paytm and the poster boy of the Indian fintech sector, took home INR 4 Cr as remuneration in FY23. Sharma’s annual remuneration increased 8% from INR 3.7 Cr in FY22. 

On the other hand, Paytm reported a 1.6X jump in operating revenue to INR 7,990.3 in FY23 from INR 4,974.2 Cr in the previous fiscal year. Net loss reduced 26% to INR 1,766.5 Cr in FY23 from INR 2,396.4 Cr in the previous fiscal year. 

Dinesh Agarwal | IndiaMART

Dinesh Agarwal, the founder of publicly listed B2B ecommerce marketplace IndiaMART, took home took home INR 3.8 Cr in salary, an increase of 11.8% from INR 3.4 in the previous year. 

The company which was founded in 1999 reported an operating revenue of INR 985.3 Cr in FY23, an increase of 31% from INR 753.4 Cr in the previous fiscal year. Profit, however, dipped around 5% to INR 283.8 Cr from INR 298 Cr in FY22. 

Sahil Barua & Kapil Bharati | Delhivery

Sahil Barua, the cofounder and CEO of Delhivery, received an annual remuneration of INR 3.1 Cr in FY23. This was a 11% increase from INR 2.88 Cr that he took home in the previous fiscal year. 

Kapil Bharati, the CTO of Delhivery, was fifth on the list with a remuneration of INR 3 Cr in FY23, an increase of 24% from INR 2.42 Cr in FY22.

Meanwhile, Delhivery reported a 5% jump in operating revenue to INR 7,225.3 Cr in FY23 from INR 6,882.2 Cr in the previous fiscal year. Loss was almost flat at INR 1,007.7 Cr in FY23 as against INR 1,011 Cr in FY22. 

Gaurav Singh Kushwaha| BlueStone

Gaurav Singh Kushwaha, the CEO and cofounder of Ratan Tata-backed jewellery brand Bluestone, took home an annual remuneration of INR 3.1 Cr. This was a surge of 313% from INR 75 Lakh he took home in the previous fiscal year.

Meanwhile, BlueStone saw its operating revenue increase 67% to INR 771 Cr in FY23 from INR 461.3 Cr in the previous fiscal year. Net loss jumped 183% to INR 167.2 Cr in FY23 from INR 59 Cr in FY22.

Last Updated: 15th December, 18:30 PM IST

The post Founder Salaries Tracker FY23: Amid The Funding Winter, How Much Did Startup Founders Earn? appeared first on Inc42 Media.

Just when the Indian startup ecosystem was poised to reach new heights, the year 2022 unfolded like a nightmare and with it unravelled a flurry of distasteful events.

While the likes of Trell, Zilingo and BharatPe made headlines in 2022 for all the wrong reasons, 2023 became the extension of what could not be accomplished a year ago in terms of setting wrong precedents. 

From the boardroom brawls of BharatPe, founders falling victim to deception at a startup forum, financial mismanagement and syphoning of funds to accusations that Shark Tank judges failed to uphold their promises, the year thus far has been rife with controversies, painting a less-than-ideal picture of the Indian startup landscape.

Now that we stand on the edge of 2023 to welcome 2024, let’s take you through this year’s top controversies and disputes that we wished had never happened to start with.

With that said, let’s get the ball rolling.

Revisiting Major Startup Controversies That Stirred Up A Storm In 2023

BYJU’S 2023: A Year Of Turmoils

In 2023, the edtech juggernaut, BYJU’S, found itself ensnared in a series of controversies. The year commenced with a saga of delayed financial reporting, prompting the departure of auditor Deloitte Haskins & Sells and the exit of three influential board members — MD of Peak XV Partners V Ravishankar, Russell Dreisenstock of Prosus and Chan Zuckerberg’s Vivian Wu. 

As the year unfolded, BYJU’S encountered an inquiry by the Enforcement Directorate (ED), alleging a staggering INR 9,000 Cr violation of FEMA rules, resulting in a show cause notice. 

The challenges intensified when the Board of Control for Cricket in India (BCCI) took BYJU’S to the National Company Law Tribunal (NCLT) over a dispute concerning sponsorship dues amounting to INR 158 Cr for the Indian cricket team’s jerseys.

In the midst of a difficult year, BYJU’S named Arjun Mohan as its India CEO. Close on the heels of him taking over the reins of the company, the edtech announced that it will have to let go of 4,000 employees. Not to mention, the edtech decacorn had already been laying off employees in small groups.

On December 6, it came to the fore that the startup had not submitted the PF of its staffers since August, even after deducting the same from their paycheques. BYJU’S made a similar folly last year too.  

Now, BYJU’S has scheduled an Annual General Meeting (AGM) on December 20, which is aimed at resolving a list of issues, including its much-awaited financial results for FY22. Although it has already posted an EBITDA loss of INR 2,253 Cr for FY22, much is still to be reported.

Under the pile of aforementioned troubles also lay the edtech’s legal tussle with its TLB investors, back-to-back valuation markdowns, several instances of misselling, and a likely sale of its subsidiary companies Great Learning and Epic by Byju Raveendran. 

As of now, the entire startup ecosystem seems to be closely keeping its eye on how the BYJU’S chapter will unfold in the upcoming year.

Financial Deception At GoMechanic & Mojocare 

In the early months of 2023, automobile after-sales startup GoMechanic, too, faced corporate governance crisis. Cofounder Amit Bhasin publicly admitted to committing “errors in judgement” regarding financial reporting while trying to pursue growth. 

The startup allegedly misled investors for years by showing fake numbers. GoMechanic was acquired by a consortium led by Lifelong Group, a majority shareholder in GoMechanic rival Servizzy for about INR 220 Cr. But major investors of GoMechanic, including Orios Venture Partners and Peak XV Partners, filed a joint complaint against the startup’s founders, leading to an FIR by the Delhi Police’s Economic Offences Wing. 

 In a similar story, healthtech startup Mojocare’sfounders, Ashwin Swaminathan and Rajat Gupta, too, confessed to cooking the books. 

This confession led to a change in leadership and eventual plans to shutter operations, returning capital to investors. 

India’s Very Own Fyre Festival For Startups 

Just three months into 2023, the patience of Indian founders was put to the test by the organisers of The World Startup Convention (WSC).

Promoted as India’s biggest funding festival by influencers such as Ankur Warikoo, Prafull Billore, Chetan Bhagat and Raj Shamani, the three-day event was supposed to host minister Nitin Gadkari, Tesla’s Elon Musk, Google’s Sundar Pichai, and the Crown Prince of Dubai as speakers from March 24 to March 26 in Greater Noida.

Much to everyone’s annoyance, the event proved to be a sham, triggering a clash as some attendees spent over INR 50 Lakh to become a sponsor of the event for the World Startup Convention.

While the organisers of the event, Luke Talwar and Arjun Chaudhary, denied any charges of cheating and duping the participants anywhere between INR 6,000 to INR 8,000 for a three-day pass, clashes between organisers and attendees led to police intervention at the venue.

Along with organisers Luke Talwar and Arjun Chaudhary, influencers like Ankur Warikoo and Chetan Bhagat were blamed for endorsing the event. 

At the time we had questioned — “Where is India’s influencer economy headed?” 

The  Broker Network Implosion 

In the middle of the year, 4B Networks, the third entrepreneurial stint of Housing.com founder Rahul Yadav, came into the headlines. The controversy started when its investor Info Edge initiated a forensic audit into the affairs of the proptech startup. 

As the investigation unfolded, from unsettled debts to multiple entities to an alleged illicit transfer of funds from Broker Network to two other companies associated with Rahul Yadav and his wife, Karishma Singh, several issues were revealed.

It turned out that the money from 4B Networks took a detour to Yadav’s holding company and then found its way to a company called Kult App, where Yadav’s wife played a big role. 

In November, Rahul Yadav was quite close to being put behind bars but had a close shave in an INR 50 Lakh cheque bounce case filed in May by an erstwhile Broker Network employee, Arun Singh Shekhawat. 

It must be noted that the Economic Offences Wing is also investigating two separate cases against Yadav, one of which is filed by Broker Network’s lead investor Info Edge, alleging an INR 288 Cr graft. In addition, employees of the company have also not been paid since September 2022.

Embroiled in multiple allegations of fraud, Yadav’s story once again shows how important it is for founders to have strong ethics in place.

The BharatPe-Ashneer Grover Brawl Intensified In 2023

The BharatPe-Ashneer Grover brawl continued to make headlines into 2023 as well. Topping the list of headlines was a criminal complaint against Grover, his wife Madhuri Jain Grover, and her family members, which turned into a full-blown FIR by Delhi Police’s Economic Offences Wing (EOW). 

Despite Grover’s consistent denial of allegations, a lookout circular led to the couple being stopped at the Delhi Airport. Alongside, the EOW’s probe allegedly uncovered payments to sham HR consultancies run by Madhuri Jain and her kin.

Already in the face of EOW questioning for allegedly syphoning funds from BharatPe, beleaguered former managing director Ashneer Grover landed himself in yet another legal soup just last month (November).

The fintech juggernaut filed a fresh case against its outspoken ex-MD in the Delhi High Court for publicly sharing the company’s confidential information on a social networking platform. The ex-MD had to apologise for the posts and was slapped with an INR 2 Lakh fine.

Mounting a multi-pronged legal offensive against the Grovers, BharatPe has initiated as many as 15 proceedings against the couple and their kin, including a civil suit for alleged embezzlement that seeks INR 88.67 Cr in damages from the duo.

The INR 200 Cr Wedding Aisle That Led To Mahadev Betting App Scam

In February 2023, the opulent INR 200 Cr wedding of Indian native Sourabh Chandrakar in Ras Al-Khaimah, the UAE, drew the attention of enforcement agencies. Hailing from his humble origins as a juice vendor in Chhattisgarh’s Bhilai, Chandrakar’s meteoric rise raised the eyebrows of many in the government as they began a full-scale investigation into his finances. 

Seven months later, the Enforcement Directorate unearthed the Mahadev app online betting scam, exposing Chandrakar and Ravi Uppal as its masterminds.  

In October, the ED filed a chargesheet, naming 14 persons, including Chandrakar and Uppal, before a PMLA court in Raipur, Chhattisgarh. The Mumbai Police later joined the probe, too, and booked 32 individuals during its investigation. 

Caught in between seem to be a clutch of prominent figures and Bollywood celebrities who have been interrogated and named in various chargesheets and complaints filed by both the police and the ED. 

Meanwhile, on December 23, it was reported that Uppal was detained in Dubai by the local police on the basis of a red notice issued by the Interpol at the behest of the enforcement directorate.

ZestMoney’s Saga Of Failed Acquisitions, Founder Troubles & Shut Down 

The journey of ZestMoney, once the BNPL poster child of India, came to an end after the management shocked its employees by asking them to stay at home from December 7.

The management had to pull the plug on the company after an internal funding round failed to materialise, as per sources. 

For the uninitiated, the cash-starved startup was fighting many battles — founders calling it quits, failed acquisition bids, regulatory hurdles and a severe slowdown in the core BNPL business. 

It is imperative to mention that ZestMoney once held its head high with a peak valuation of $455 Mn. However, soon the company fell into a debt trap due to growing NPAs, sub-par collections and a faulty business model. This was despite the company’s claim of catering to 17 Mn registered users. In FY22, ZestMoney’s losses bloated 3X YoY at INR 398.8 Cr due to a steep rise in expenses. 

Operating within a business model similar to BNPL players like LazyPay and Simpl, ZestMoney was sitting on an NPA rate exceeding 13%, way above the healthy BNPL loan default rate of 2-3%.

Earlier in the year, ZestMoney’s cofounders Lizzie Chapman, Priya Sharma, and Ashish Anantharaman stepped down. Following their exits, the new management took over and was in talks to raise funds but to no avail.

Did Sharks Ghost Founders? 

The popular TV show Shark Tank India has undeniably left a lasting impact on citizens, so much so that the show is one of the topics of discussion at the Indian dinner table.

However, the euphoria surrounding the show has been marred by allegations from young founders who have voiced concerns about the conduct of investors, aka ‘Sharks’. 

Many participants of Shark Tank India told Inc42 that the Sharks have deliberately delayed investments under various pretexts. The participants have also alleged that the Sharks are impolite in person and deride their business models even after promising investments.

Complicating matters further, as per the participants, is the absence of proper documentation of the funding commitments they get on-air, which makes it tough for them to seek legal recourse. Notably, verbal promises lack the legal weightage necessary for pursuing legal recourse.

In June, we were also told that Sony TV only assures of providing a platform, and there are no terms and conditions to protect our interest if judges renege on their pledge.

At the time, it also came to the fore that Sharks got defensive and reneged from their commitments after engaging in the due diligence processes of some of the show’s participants.

[Edited by Shishir Parasher & Vinaykumar Rai]

The post Disputes, Deception & Fibs: Revisiting Major Startup Controversies That Stirred Up A Storm In 2023 appeared first on Inc42 Media.

Last year, this time around, we remember mentioning how 2023 would be no different from the year in review (2022), which took jobs of more than 18K startup employees due to reasons galore. 

As expected, the layoff axe continued to slash employee headcounts at Indian startups, with over 17K jobs already lost as of December 8 this year. Essentially, the primary factors that played a macro role in making 2022 an attrition-heavy year found their way into 2023 as well.

For the uninitiated, the entire 2022 was laden with the impact of Russia’s invasion of Ukraine on the global economy, ailing markets, rampant inflation and the fear of a global recession. These, in turn, impacted investor sentiment, along with the fact that Indian startups had little to deliver but cash burns.

Long story short, according to the data collated by Inc42, more than 35K startup employees have lost their jobs since the onset of the funding winter in Q1 2022. However, if industry experts are to be believed, 5,000+ layoffs have gone unreported.

Moving on, leading the onslaught are BYJU’S, Ola, Unacademy, Blinkit, and WhiteHat Jr, which have shown doors to 13,740+ employees in the last two years. Interestingly, among these industry frontrunners in living the layoff dream, BYJU’S takes the podium with 6,500+ job cuts.

While BYJU’S, Ola, Unacademy, Blinkit and WhiteHat Jr together sacked an estimated 9,390 employees in 2022, BYJU’S, Skill-Lync, GoMechanic, ShareChat and ZestMoney made 6,075+ employees look for pastures new.

Now, we can either blame the ongoing funding winter for the meltdown in the startup job market or talk about the factors that have largely remained hidden in plain sight, adding more blue to the Indian startup gloom.

Two Attrition-Heavy Years: Who’s To Blame?

As per the Inc42 analysis, homegrown startups raised $8.67 Bn between January and November 2023 against $22 Bn and $27 Bn during the same time in 2022 and 2021, respectively.

Looking at the correction rate, which stands at 61% for 2022 and 68% for 2021, it is easy to blame the funding winter, which is the root cause of almost every anomaly in the Indian startup space.

However, if you are a regular reader of Inc42, you would know that we always try to look beyond the clichés in our endeavour to bring forth deeper analogies and equations working in the background.  

In our perusal to look beyond the funding winter, we learned that the world’s third-largest startup economy is also vulnerable to attrition caused by high work stress.

It is also imperative to mention that, unlike typical 9-5 office jobs, startups seek high levels of commitment, ownership, accountability and efficiency from their employees. “Therefore, several employees leave due to high stress and workload,” an industry expert said. 

According to a March 2023 EY report, the ecommerce, technology and related sectors – all startup-related segments – experienced attrition rates exceeding 20%, with an average involuntary turnover of 4.4% across segments.

Moving on, given that many similarities exist between startups and tech companies regarding employee skill sets, the high attrition rate in the two circles results from people leaving one domain to enter another.

Further, it is anybody’s guess that the state of the Indian startup workforce has been adversely impacted by geopolitical and macroeconomic developments over the past two years — rising energy and food prices, the US hitting its debt ceiling, the trade war between the US and China, the Russia-Ukraine war and the Palestine-Israel conflict.

Global inflation rose on the back of these developments and all these factors confected a reduced market liquidity. This has broken the confidence of VCs and PEs in Indian startups, making them think twice before embarking on the route fraught with uncomfortable twists and turns. 

As such, grappling with falling revenues and mounting losses, capital-hungry Indian startups have been sacking employees just to extend their cash runway for a bit longer.

Adding insult to injury, the emergence of generative AI has been yet another dent in the image of the Indian startup corporate culture. With the rapid adoption of AI, industry experts see consumer-facing roles being rendered obsolete soon. 

Startup Turnarounds Made Employees Pay Heavily In 2023

According to Inc42’s Indian Startup Layoff Tracker, which monitors startup layoffs across the country, nearly two-thirds of the layoffs that took place during the year (2023) were attributed to restructuring or turnaround efforts by various Indian startups. 

In terms of numbers, nearly 11K employees have been impacted by restructuring exercises so far this year. Going by the available data, only about one-fifth of the laid-off employees lost their jobs due to cost-cutting measures. This number ought to be much higher, but the current analysis only considers the official reasons for layoffs provided by the startups.

Meanwhile, during the year, late stage Indian startups accounted for more than half of the total layoffs conducted in the Indian startup realm, witnessing a respite from 2022 when late stage startup layoffs accounted for approximately 70% of the total job cuts.

On average, a late stage startup sacked 14% of its workforce in a typical layoff exercise in 2023 compared to 265 growth stage and 41% at the early stage. It is imperative to note that industry experts see the layoff trend mirroring stage-wise funding trends observed during the year. 

According to Inc42 data, growth stage funding fell 38% during the first half of 2023. Meanwhile, late stage funding increased by 30% YoY, which might be a reason why late stage startups saw fewer layoffs this year than last year.

Edtech, Consumer Services, Enterprise Tech Employees Among The Worst-Hit

Among the 11 startup segments that saw layoffs during 2023, edtech, consumer services and enterprise tech saw the most job losses. Two of every three startup employees laid off during the year worked in one of the aforementioned segments.

Refusing to budge, edtech continued to be the startup employees’ worst nightmare, accounting for more than 40% of all layoffs during the year at more than 6,758. BYJU’S, the edtech behemoth, alone accounted for nearly a quarter of the total layoffs recorded by Inc42 during the year so far.

Consumer services retained its unfortunate label alongside edtech as being among the top segments impacted by layoffs for two consecutive years. This year, 11 startups in the sector fired over 2,105 employees. Across the past two years, 19 startups in the space let go of nearly 7,400 people.

Enterprise tech became an unexpected entry into the startup layoff realm as 18 startups from the segment fired over 1,700 employees during the year. Troubled by the fall in enterprise spending across the globe, the segment’s share in handing out pink slips jumped from 2.6% in 2022 to 10.3% in 2023.

Will 2024 Be Any Better?

The last few years have been quite paradoxical. While we have observed investors going gaga over the charm of Indian founders, we have also witnessed them tightening their purse strings in no time.

For instance: The nine months between July 2021 and March 2022 were witness to the most intense funding activity the Indian startup ecosystem had ever seen. In just three quarters, homegrown startups raised $44 Bn.

In contrast, the nine months between July 2022 and March 2023 saw the worst layoffs during any time in the history of the Indian startup ecosystem. During this period, 63 Indian startups fired 12,214 employees.

However, the only common trend in 2023 has been investors’ distastefulness in making vanity startup bets, despite accumulating billions of dollars in dry powder.

As analysts continue to sound caution over unsustainable business models and growth trajectories, Indian startups seem to be rethinking their approach and strategy.

On a different note, rating agency Fitch delivered a mix of good and bad news earlier this week. While the good news is that the US economy has managed to avoid a recession, the bad news projects the world’s growth to fall sharply to 2.1% in 2024 from 2.9% in 2023.

Predicting the future is a fool’s errand. However, we can only expect 2024 to be the year of revival, with global supply chains returning to normalcy and core inflation cooling off faster than anticipated.

However, given that the current funding scenario reminds one of the pre-pandemic funding era, employee retrenchment is an anomaly we may see Indian startups bracing in yet another painful year on the employee front.

The post Two Years, 35,000+ Job Cuts: Indian Startup Layoffs Continue, Will 2024 Bring Change? appeared first on Inc42 Media.

During the recently concluded Big Billion Days Sale, Walmart-owned ecommerce major Flipkart launched an annual membership programme – yet again. The announcement of Flipkart VIP was not a rarity, though. Over the years, it came up with a handful of premium memberships and loyalty programmes, but they failed to compete with its arch-rival, Amazon India, and its flagship, Amazon Prime. 

Flipkart First, Flipkart Plus and Flipkart Plus Premium came and went without much ado. This year, Flipkart VIP was clubbed with its biggest online event to create maximum impact. But can it trump Amazon Prime at long last? 

Let us delve deep into their offerings to understand what value they bring to users and which is worth our money. 

Just like Alibaba’s Singles Day or the western world’s Black Friday sales (the latter is no longer a novelty in India), the country’s shopping frenzy peaks during Navratri, a hallmark celebration of Indian consumerism across states and communities. No wonder ecommerce behemoths like Amazon and Flipkart gear up with big deals, discounts and promotions to make the best of this mega-sales event. 

The critical importance of this festive season was best exemplified when, on 6/10/2014, Flipkart launched its first Big Billion Days sales, eyeing a target of INR 600 Cr. (Fun fact: 6.10 was the flat number in Koramangala, Bengaluru, where the company was set up in 2007.) The rest of the narrative is pretty well-known. The overwhelming online traffic led to technical failures, and eventually, Flipkart’s website and payment system crashed.

The narrative changed this year when Flipkart launched its annual membership, Flipkart VIP, on October 4, just before the Big Billion Days (TBBD) kicked off on October 8. The pricing is enticing, INR 499, compared to Amazon’s full-fledged Prime membership at INR 1,499 (it has other versions, but more on that later).

A look at the festive numbers puts Flipkart ahead in the competitive landscape. While the Amazon India site and app claimed 1.1 Bn visits, Flipkart claimed 1.4 Bn visits. Also, Flipkart Fashion played an important role in customer acquisition, bagging more than 44% of new users during TBBD.

According to consulting firm RedSeer, ecommerce platforms in India clocked a gross merchandise value (GMV) worth INR 47K Cr during the first week of the online festive sales. Last year, total GMV across ecommerce platforms was around INR 76K Cr, compared to a whopping INR 90K Cr+ estimated this year.

The Flipkart Group, including Flipkart, Myntra and Shopsy, led the race with a 63% market share in GMV, followed by Amazon. The group also led the field in volume play, followed by Meesho, with 25% of the total orders, up from 21% in the first week of the 2022 festive season sales. Amazon, however, disapproved the data collated by RedSeer.

However, competing with Amazon remains a formidable task for its peers. Going by the data revealed by Amazon India, the highest Prime sign-ups happened in a single day this festive season, along with the highest seller participation and 5K product launches from top brands. Interestingly, “This festive season, 80% of our customers who shopped came from tier 2-3 cities,” said Manish Tiwary, country manager, India Consumer Business, Amazon in a press statement.

All You Need To Know About Flipkart VIP & Other Loyalty Programmes

Although Flipkart VIP is the group’s third attempt to launch a paid annual membership (with two loyalty programmes in between), experts think it still lacks the Prime punch. Nevertheless, it may generate quick revenue without significant investments due to price advantage. But before comparing the pros and cons of Flipkart VIP and Amazon Prime, a quick look at VIP and its previous programmes will help us understand how Flipkart has evolved over the years.

How Flipkart VIP Stacks Up Against Amazon Prime

Before we assess whether Flipkart’s new VIP membership can compete with Amazon Prime and dent its fast-growing member base, here is a quick look at the key features offered by the ecommerce giants.

Unlike Prime, Flipkart VIP, as the name suggests, offers priority customer support.

Prime Membership provides free one-day delivery on 4 Mn+ products, ad-free access to Prime Video and Prime Music, unlimited 5% cashback (for Amazon Pay Credit card holders), Prime Reading, Prime Gaming, including monthly free games and exclusive in-game content for popular titles, early access to lightning deals and additional 10% discount on certain products.

Flipkart VIP also ensures fast and free delivery, early access to lightning deals and discounts. Although it does not provide streaming services like Prime, it has a few unique benefits such as a Welcome Box with assorted products, the ability to cancel/reschedule domestic flights booked on Cleartrip for INR 1 (can be used only once during the membership period) and an additional 3% discount of up to INR 3K on Cleartrip hotel bookings.

While Prime offers cashbacks on flight bookings done via Amazon Pay card holders it lacks the cancellation feature that VIP offers. 

A Close Look At Flipkart’s ‘VIP’ Targets 

Flipkart has consistently focussed on the fast-growing non-metro market where aspiring customers seek new products but have limited access to the ecommerce ecosystem. According to the company, it witnessed close to 50% user growth after the pandemic lockdowns, with Tier III+ regions accounting for nearly 65% of the newfound growth. Even in 2023, the first day of its festive sales saw more than 60% of the orders coming from Tier I, II and III cities.        

Nevertheless, Flipkart’s VIP programme aims to deepen its position across the key cities. Although the company has declined to comment on its shift in focus, some ecommerce analysts think it will be essential if Flipkart wants to emulate Prime-like delivery schedules.

“Extending free and fast deliveries in Tier III+ locations is difficult, as it will increase logistics costs in the first place,” said an analyst from Gartner who did not want to be named. “Add to that is the average return rate that would further increase the cost. No wonder, Flipkart had initially offered return pickup within 48 hours in 4 cities – Delhi NCR, Bengaluru, Mumbai and Kolkata as part of VIP programme.

That’s why Prime is hugely popular in metros, but in smaller cities, Amazon’s OTT service [and not fast deliveries] lures people to subscribe.” 

Though this festive season, Amazon claimed that more than 65% of Prime members who shopped during the festive season were from tier 2 & 3 cities/towns. 

However, the average volume as value of transaction per customer is still significantly higher in metro cities.

Of course, some users from non-metros may opt for the VIP programme as they want faster delivery. But here is the catch. Be it Prime or VIP, fast deliveries or quick pickup for returns, say in 48 hours, are rarely available in Tier III and IV cities.

Moreover, Flipkart VIP (or any premium membership) is meant for frequent shoppers with deep pockets. Paying membership fees and delivery charges (when required) is costly, and not all buyers can afford it, said Satish Meena, advisor to Datum Intelligence.

As the success of these programmes is underpinned by frequent buying and buying of more categories (volume) as well as big-ticket purchases (value) from metros, it makes sense for Flipkart to target customers from Tier I and II cities only to grow its VIP member base. 

According to Meena, non-Prime shoppers on Amazon have an average order value (AOV) of INR 1,000-1,200, while Prime members have an AOV of INR 1,800-2,000, nearly double the spend of a regular shopper. Understandably, Prime generates maximum profit for Amazon in India and globally.

Flipkart VIP must target this customer segment to win the battle royal. Although Amazon Prime enjoys a strong presence in metro cities, many Prime members continue to use other platforms to buy stuff not sold on Amazon. Flipkart VIP can make a dent if it can create a go-to shopping hub at one-third the charge. 

How The Titans Battled It Out Over The Years 

Flipkart pioneered paid annual membership with Flipkart First in 2014, offering free and fast delivery for INR 499. The all-new programme included a host of benefits such as free shipping for all orders, free ‘in-a-day’ guaranteed delivery, guaranteed same-day delivery at discounted pricing, a 60-day replacement policy, priority customer support and more. The company also gave away 75K free memberships to attract online shoppers for whom it was a novelty. 

The narrative changed in 2016 with the launch of Amazon Prime at the introductory price of INR 499. The ecommerce giant introduced cheaper same-day deliveries, a better cancellation policy and, most importantly, access to Prime Videos. It was an added attraction as we had yet to witness the OTT tsunami of the pandemic days. 

Flipkart quietly discontinued its membership programme, but not for long. It relaunched Flipkart First in 2017, primed with an entertainment pack that offered a three-month Hotstar subscription at a discounted price of INR 99 and free premium membership for the music streaming platform Gaana.com. Its core offerings included free and fast delivery and free cancellations for a limited number of flights booked on MakeMyTrip.   

Despite these measures, the relaunched Flipkart First folded up. In contrast, Prime became such a hit that Amazon could increase the membership fee from INR 499 to INR 999. A full-fledged Prime Membership currently costs INR 1,499, while a Prime Lite version is available for INR 999, with slight tweaks in OTT services. 

When Flipkart launched its VIP programme in October this year, it played the price card and kept the introductory fee at INR 499. It was not a bad strategy. If 55% of Prime members subscribe for free and fast delivery, Flipkart should be able to lure them by offering the same convenience at 66% less. Also, member acquisition would be easy due to brand awareness and proximity. Most of these buyers already have Flipkart accounts, although they use the platform less frequently.  

Amazon took note of the price play. At the time, it was offering Prime and Prime Lite, but soon after the VIP launch, the ecommerce major came up with Prime Shopping at INR 399, a strategic price point aimed to blow Flipkart’s advantage.

Although pricing can be a game-changer in the Indian context, the impact of ecommerce companies goes far beyond that. Inc42 has spoken to many analysts and industry experts who think Flipkart still has a long way to go to compete with Prime. The reason? Amazon offers an overarching ecosystem across the realm of shopping and entertainment, never matched by Flipkart. Despite high membership fees that could have backfired in a price-conscious market like India, bundle pricing attracts customers as they have to pay less than the total cost of buying individual services included in the package. 

Consider this. Apart from giving access to its own content, Prime Video integrates popular OTT platforms such as Lionsgate Play, Discovery, BBC and Eros Now to offer bundled service that costs less than the total of those platforms’ standalone charges. Besides, one can access different genres in one place minus the hassles of multiple downloads and different payment schedules. This makes a huge difference for content lovers seeking convenience and variety.

According to a Datum Intelligence report, more than 50% of people opt for Prime Membership due to seamless access to Prime Videos, while 37% do it for the advantage of music streaming. These account for significant numbers, but Flipkart has not tried to service these segments yet.

The introduction of Amazon Fire TV Sticks (third-generation devices are available now) is another crowd-puller. The HD streaming device with Alexa Voice Remote includes TV and app controls, converts a regular television into a smart TV and can easily replace cable subscriptions. Amazon has sold 200 Mn+ Fire TV Sticks globally and claims to have sold the device across 90% of Indian pin codes. Although it has not revealed the India numbers, the pin code coverage underscores the depth and reach of its services, enhancing the scope for pushing Prime Membership in every nook and cranny.

Vaitheeswaran K, an ecommerce veteran and cofounder of Again Drinks, summed up the situation well. “Although Amazon has increased Prime membership fees several times, we are not overly concerned about the cost, primarily due to the experience it offers as an ecosystem,” he pointed out.

Why Flipkart VIP Lacks The Punch

Online shoppers could be in a fix trying to decide which membership programme would be worth their while in the long run. Meanwhile, here is a quick look at how some of the Flipkart VIP services fall short of Prime advantages. 

Customer Support and VIP Service Hit a Bump. Shortly after the launch, amidst the festive season, social media became inundated with complaints related to VIP membership services. Users expressed dissatisfaction with Flipkart, citing issues such as delayed delivery, return pickups exceeding 48 hours, and perceived lapses in prioritizing customer support.

Full refunds for flight tickets may not captivate users. Providing full refunds for domestic flight tickets that too only once will only appeal to a small segment – people who are frequent fliers.  

Welcome Box is a puzzle. The Welcome Box is as vague as possible, points out the analyst associated with Gartner. To start with, Flipkart says it will send the box anytime during the membership year, thus killing the excitement. Moreover, users do not know what to expect, which may lead to disappointment.

VIP lacks unique and differentiated services. Unlike Amazon’s broad ecosystem and extensive services, Flipkart VIP solely focuses on free and fast delivery, which is a given for most ecommerce companies. More importantly, Prime offers complementary products and services to push growth. For instance, any user of Fire TV will opt for Prime Membership instead of other programmes. On the other hand, Flipkart VIP struggles to provide unique and differentiated services not featured in its loyalty programmes.

Limited availability may hinder growth. While more than 65% of Prime members who shopped during the 2023 festive season were from Tier II and III locations (versus 50% last year), Flipkart VIP is touted to be available across Delhi-NCR, Bengaluru, Mumbai and Kolkata. However, many users from Delhi, Mumbai and Bengaluru have reported that the registration link is not working. 

So far, the entire exercise has been relatively low-key. The VIP subscription is not available online, and users who have contacted the support team have received little help. The team says the VIP programme is either selectively offered to users or might have been withdrawn. 

In today’s fiercely competitive business landscape, companies emulating each other find it difficult to come up with service innovation that will gain a competitive advantage. While Flipkart is grappling with similar challenges, its limited availability may further hinder it from reaching a wider audience. 

As the battle for supremacy in the Indian ecommerce space continues, Flipkart needs to recognise Indian customers’ unique nuances and turn those into cutting-edge opportunities. Otherwise, it will be a tortuous and uphill road as it tries to curb Amazon Prime’s overwhelming dominance.

[Edited by Sanghamitra Mandal]

The post Flipkart Looks To Upstage Amazon Prime Again: Will Its Revamped VIP Programme Be The Charm? appeared first on Inc42 Media.

It’s a season of pain for even some of the most storied venture capital firms in India, and Omidyar Network is just the latest one to succumb.

The firm, which has backed the likes of 1mg, Bounce, Indifi, ZestMoney, Drinkprime, DealShare, Vedantu, Pratilipi among other startups, is shutting down its India operations.

While the announcement has come this week, Omidyar Network India will completely transition out of the Indian market by the end of 2024.

“After several months of deliberation, it has been decided that Omidyar Network India will stop making new investments and will completely transition out of the market by the end of 2024. Over the next two months, the board and leadership team will assess how best to manage the organisation’s portfolio while recognising the long and trusted partnerships that the Omidyar Network India team has built,” a statement from the firm said.

Active in India since 2009, Omidyar is among the handful of VCs that have seen the startup ecosystem grow to its current size from a nascent part of the economy.

There’s some speculation of a division within the Omidyar Network India (ONI) management to further separate the Indian investment vehicle from Omidyar Network’s global investment arm. But at the moment, the firm remains tight-lipped about the next steps.

What we do know is that in a conversation with some founders of its portfolio, ONI has set a 3-5 year horizon for exiting its investments and the firm is likely to also transition out of many boards where its representatives are currently directors.

“The leadership had a short call with some of us portfolio founders and informed us about the next steps, which included the estimated exit horizons and also boardroom changes,” one founder who was present on the call told Inc42.

The founder said Omidyar was clear that there would be no change in management at least until December 2024 and indicated that the firm is not likely to be in a hurry to liquidate its assets, even though that will be the primary focus area.

But before we look at the implications on its portfolio, it’s important to understand what exactly forced Omidyar to quit the Indian market, and as we will see, there are multiple factors at play here, including the firm’s problems with Indian law enforcement. The fund managers and partners we spoke to called it a “sudden-yet-expected” departure.

Omidyar’s India Experience

Backed by eBay founder Pierre Omidyar, Omidyar Network India is a veteran in the Indian startup ecosystem, having invested in new-age ventures since 2009 onwards.

While its core focus has been on impact investing in nonprofits and grassroots organisations, it has also branched out to back startups in the mobility, fintech, edtech and other for-profit sectors, and has invested through three separate entities from its early days.

As per its website, the company has a total AUM of $673 Mn with over 120 portfolio companies. Over 70% of this corpus has been invested in private for-profit ventures.

In 2023, Omidyar invested in Indifi’s Series E round, as well as Series A rounds of SatSure, Sequretek, Kiwi, DGV and ZestMoney, which incidentally is in the process of dissolution. Most recently, Omidyar Network India led dairy fintech startup Digivriddhi Technologies’ (DGV) INR 50 Cr ($6 Mn) Series A funding round.

Over the years, ONI has also seen exits from the likes of WhiteHat Jr, Dailyhunt, Pickrr, NowFloats, Credlfow, IndusOS and 1mg, many of which were acquired by leading companies. Indeed, its exit track record is healthy for a firm of its vintage, given that even the likes of Tiger Global and others have struggled to extract high returns in recent years.

For instance, WhiteHat Jr was acquired by BYJU’S in August 2020, netting a 17X return for Omidyar. Besides this, 1mg was acquired by Tata Digital in June 2021 in a high-profile deal; NowFloats was acquired by Reliance Industries for $20 Mn and IndusOS by PhonePe for a reported valuation of $60 Mn in 2022.

Despite these positive outcomes, it seems Omidyar has lost patience with the Indian market. Or was its hand forced by external factors that are not related to its portfolio, as is the speculation in the immediate aftermath of the announcement?

Why Omidyar Is Quitting India

The undeniable fact is that Omdiyar’s track record of exits has also come alongside controversies related to its investments in non-profit organisations, some of which have come under the radar for the source of funding.

For one, Omidyar Network India came under fire in 2021 when it was placed on a watch list by the home ministry, which came with restrictions on the foreign donations it could accept.

Omidyar was named as an accused by the Central Bureau of Intelligence (CBI) for allegedly conspiring to illegally facilitate the registration and renewal of Foreign Contribution (Regulation) Act (FCRA) licences. FCRA licences are mandatory when receiving funds from foreign sources for charitable purposes.

Additionally, Omidyar has come under fire from members of the current ruling party in India for being associated with alleged iPhone hacking warning messages and its monetary contribution to entities that are said to be working against the interests of India.

Moreover, in June 2021, SEBI alleged that Franklin Templeton’s Asia Pacific head Vivek Kudva and his wife Roopa — ONI’s former managing partner — had violated insider trading laws and barred them from investing in the capital markets for one year.

While this is unrelated to Omidyar’s investments in startups, having the country head named in such a case would undoubtedly have carried some reputational risk for the firm.

The challenges with law enforcement and the general crackdown on FCRA violations by the Indian government have coincided with some pressure on Omidyar’s portfolio in 2022 and 2023.

Many of its portfolio companies have, in recent times, come under stress due to the tough market conditions as well as a paucity of funds. Doubtnut, for instance, was acquired by Allen Career Institute in a distress deal. Doubtnut is said to have been acquired for $10 Mn, despite raising more than $50 Mn in its lifetime.

One ONI portfolio founder told Inc42 that the firm is likely to have booked a loss of over 75% on its investment in Doubtnut. The state of other portfolio companies is also not great. The likes of Bounce, Dealshare, Healofy and others have come under scrutiny for weak business models, founder exits as well as slow revenue growth.

Interestingly, the leadership situation at the firm is less than clear after Kudva’s exit. One noteworthy point is that Omidyar’s decision-making layers have dedicated directors as well as partners. It’s not clear exactly who is calling the shots.

On the director level, the firm has leaders such as Amol Warange, Aditya Misra, Lakshmi Pattabi Raman, Sarvesh Kanodia, Sushant Kumar and Treasa Mathew. At the same time, the firm also has partners such as Siddharth Nautiyal, Badri Pillapakkam, Mahesh Krishnamurthy, and Shilpa Kumar.

This leadership structure is largely due to the fact that Omidyar’s focus was split between private investments as well as funding and grants to nonprofits. However, many VCs believe this is an antiquated structure and often results in delays in investment decisions.

And finally, there is the changing landscape of impact investing in India. When Omidyar arrived in India, its impact investing focus was on grassroots organisations and community-led MSMEs. But today, impact investing is moving into areas such as manufacturing and large-scale production which offer higher potential for employment and economic growth. As such, Omidyar’s thesis is perhaps also a bit outdated in the Indian context and might be better suited for other geographies.

VCs Feel The Heat 

Portfolio problems are of course not exclusive to Omidyar — other VC firms have seen partners exit by the droves and are in the process of dissolution in some form or the other. We have seen changes at firms such as Lightbox, Orios VP, Together Fund and others in recent weeks.

Tiger Global partner Scott Shleifer’s comments earlier this year about the lack of big returns from India also signalled a change of heart for some of the biggest investors in India. Plus, there is a great deal of competition in the early-stage ecosystem where Omidyar likes to operate.

As we have reported throughout this year, the changes at the partner level at VC firms is largely a result of poor performance of the funds and pressure from limited partners. However, this does not seem to be the case with Omidyar, according to the founder and CEO of a unicorn startup in Omidyar’s portfolio.

In the case of Omidyar, the firm is likely to have faced little to no pressure from its limited partners given the fact that most of the firm’s invested corpus comprised the personal wealth of founder Omidyar.

Another factor is that India’s foreign direct investment (FDI) rules excluded Mauritius from the list of geographies exempted from the so-called angel tax. This meant that ONI, which invested through a special purpose vehicle named ON Mauritius, would be subject to tax action in relation to the gains in valuation when investing in startups.

According to the founding partner of a Bengaluru-based early-stage firm, the word within VC circles was that a lot of firms are likely to quit the Indian market due to portfolio trouble and the changing landscape around investment thesis particularly for emerging technologies.

“While this is the moment for impact investing in India, Omidyar’s troubles with CBI were well-known. Most VCs are only surprised by how quickly the firm has announced its exit, not the fact that it has,” the partner mentioned above added.

Of course, the exit of a major investor (at least in the case of some startups) is likely to be a headache for the startup founders. What does Omidyar’s exit mean for its portfolio?

The Portfolio Impact

“In the call with founders, Omidyar was clear that the Indian ecosystem is maturing and that it no longer sees room for the role it played in the past decade. They called it a decision taken by the global leadership which would see the focus shift to other geographies,” one Delhi NCR-based portfolio founder told Inc42.

Naturally, we wanted to know what it meant for some of the companies that had already raised significant amounts from Omidyar in the past year. The likes of Indifi are at an inflection point, having also reached profitability, while others such as Vedantu, Bounce and Dealshare are said to be transitioning to better unit economics. Will Omidyar’s departure have ripple effects that disrupt this momentum?

“The biggest impact will be on the startups which have just raised a seed or Series A round from Omidyar. The exit of one major backer is a signal to the rest of the market, but again this depends on the stage of the company and how much stake Omidyar owns in the company,” the founder quoted above added.

On the positive side, another founder pointed out that given that the firm has announced its intention to exit the portfolio, it will likely make it easier to execute secondary share sales. “Typically investors are okay with a discount when they want to exit, so secondary sales might even see a discount of 40%-50% in some cases. This means founders can buy back some shares at a low rate if they have the capital,” added another Bengaluru-based founder in Omidyar’s portfolio.

Ultimately, M&As are also a possibility for some startups that are staring at an uncertain future. Given the fact that ONI’S portfolio includes some unicorns such as Dealshare and Vedantu, these startups could even acquire some of the distressed startups in the firm’s portfolio.

Whatever the fate of the portfolio startups, Omidyar’s exit is a major signal for the Indian VC and startup ecosystem. Will this be the first of the old guard to give way to a new breed of investors?

There’s also a positive undercurrent in the Indian market for domestic investors and increasing participation of HNIs and Indian corporates in the VC ecosystem. Omidyar’s global DNA runs against this grain. But many in the ecosystem feel its exit from India is nevertheless sudden and there could be a domino effect in store.

The post Behind Omidyar Network’s ‘Sudden-Yet-Expected’ India Exit appeared first on Inc42 Media.

Studies reveal that one in four Singaporeans dine out daily, while 80% opt for at least one restaurant meal every week. This shift away from traditional home-cooked meals has stemmed from broader socio-economic changes such as busy lifestyles, increased affluence and, most importantly, the rise of on-demand food delivery services riding the wave of ubiquitous digital tech and the smartphone economy.

But the dynamics of change are not limited to the island nation alone. In the past decade, India has witnessed a similar transformation in eating habits, driven by the rapid growth of the online food delivery segment. As mentioned by Statista, a Rakuten survey in December 2022 found that most Indian respondents aged 16-54 dined out at least once a week. 

Given the exponential growth across India, the online food delivery market volume is estimated to reach $81.9 Bn by 2028, growing at a CAGR of 19.7% during 2023-2028. However, this surge would not have been possible without the sturdy industry stalwarts – Zomato and Swiggy – who lay the groundwork for the food-delivery ecosystem.

Both leverage the techvantage of a digital-first ecosystem to cater to the diverse Indian food palate but compete fiercely for a bigger market share. Zomato has maintained a sizable lead over its closest competitor in terms of execution. But is Swiggy lagging far behind or breathing down its rival’s neck?

An assessment of the year gone by (2023) and the outlook for 2024 will reveal these interesting ground realities and the shape of things to come.    

Is It Zomato All The Way In 2023?

The narratives of Gurugram-based Zomato, now a listed company, and its unlisted peer Swiggy from Bengaluru are not analogous. However, much of their growth is the direct outcome of innovative marketing strategies (more on that later) and lucrative sales tactics such as discounts, cashback deals, exclusive offers and attractive loyalty programmes.

These sureshot bets (to say nothing about their expansive reach in the pan-India restaurant market) have lured gastronomes to online food-ordering over the years. Subsequently, engagement has increased and customer loyalty has split into two distinct camps. (Take a look at the app download comparison.)

The Zomato-Swiggy face-off in the food-delivery space has been accelerated by sustained investor interest. Together, these industry leaders have raised $5.4 Bn for strategic acquisitions, cloud kitchens and implementation of value-added services. More importantly, their deep pockets and industry dominance slowly squeezed out other players from the arena.

For instance, ride-hailing giant Uber India’s food delivery business UberEats was acquired by Zomato in early 2020, while Ola completed the 100% acquisition of Foodpanda (India) in early 2022 from Germany-based Delivery Hero.  

The outcome: The industry has a duopoly now where the arch-rivals claim nearly identical market shares in India. However, Zomato maintained its lead with a 54% market share compared to Swiggy’s 46% in the food delivery space as of H1 2023, according to reports.

Although it has not been a smooth ride for either of the companies in 2023, Zomato has taken the lead in several critical areas to hold strong as an icon of India’s post-pandemic gig economy boom. Here is a look at how the companies have fared this year.   

Zomato Tops The Consumer Sentiment Survey

According to Inc42’s Consumer Sentiment Survey 2023, done in collaboration with Clootrack, Zomato emerged as the preferred online food delivery service among Indian consumers.

The conclusion was based on a Clootrack analysis of more than 24K user reviews on the Apple App Store and Google Play Store between January 1 and November 22. The findings underscore Zomato’s stronghold and positive reception in the highly competitive food aggregation, online ordering and delivery market.

The survey also revealed that key success metrics, including offers and discounts, food quality, customer service, delivery time and interactions with delivery partners, received high scores for Zomato on a scale of 1-5, where 1 signified the lowest and 5 represented the top score for consumer experience.

Zomato Sweeps The Field In App Downloads

According to an Inc42-AppTweak analysis, the combined monthly app downloads of Zomato and Swiggy averaged 7.6 Mn and reached a total of 83.5 Mn between January and November 2023. Zomato led with 47.5 Mn downloads (56.9%), while Swiggy recorded 36 Mn (43.1%).

It is worth noting that the Swiggy app covers its grocery services (Instamart) and restaurant deals and discovery (Dineout) vertical besides food delivery.

Although Zomato has integrated UberEats’ operations with its own to strengthen the food delivery business, its quick commerce platform Blinkit (formerly Grofers, which was acquired in 2022) operates via a separate app. It has seen 14 Mn downloads in 2023 (excluding December data), and combined with Zomato’s download numbers, puts the parent company in a superior position.

But Financial Dips, Critical Exits – Who Has Weathered It Better

Zomato faced a challenging start to 2023, marked by the departure of its CTO, Gunjan Patidar. A subsequent 2% dip in its share prices was followed by an 8% decline, hitting its lowest since July 2022. Despite the setback, Zomato’s consolidated revenue for Q3FY23 (October-December 2022) surged by 1.75x to INR 1,948 Cr, but the foodtech giant saw a 5x spike in losses, reaching INR 346.6 Cr. 

Not only this, it liquidated its subsidiaries in Jordon, Czech, Portugal while in process of shutting operations in the Philippines and Indonesia with active operations only in India and the UAE. 

Zomato had also placed early bets on non-metro markets to widen and deepen its reach, a cash-burning exercise as it would not provide immediate results. However, given the global slowdown in 2023 due to macro headwinds, the foodtech unicorn focussed on improving its financial performance.

Zomato hit overall profitability in Q1 (April-June 2023) and Q2 (July-September 2023) of the current financial year and reintroduced its Gold loyalty programme in January, which has now surged to 38 Lakh members.

Although it is not strictly contextual (Swiggy is not a listed company), Zomato stock has given excellent returns in 2023 on a YTD (year-to-date) basis. After some dismal performances post its IPO, the stock has emerged as a multibagger and gained around 103% as of November 2023.

We have not considered the market loss it suffered on December 11, 2023, as the company was under pressure after SoftBank offloaded its remaining stake in Zomato.

Swiggy, too, grappled with persistent losses, high-profile exits and diminished investor confidence ahead of its impending IPO. 

The Bengaluru-based foodtech unicorn is yet to announce its FY23 earnings, but it reported a loss of INR 3,628.9 Cr in FY22 with an operating revenue of INR 6,119.8 Cr. It also restructured the business and adopted cost-cutting measures, resulting in the termination of 380 employees.

Key people, including Karthik Gurumurthy (Senior Vice President and Head of Swiggy Instamart), Dale Vaz (CTO), Anuj Rathi (SVP, Central Revenue and Growth ), Ashish Lingamneni (VP, Marketing) and Dineout cofounder Vivek Kapoor, were among its high-profile exits.

To add to its woes, the US-based investment firm Invesco marked down Swiggy’s valuation twice earlier this year, eventually slashing it to $5.5 Bn from an earlier $10.7 Bn. Swiggy reached the decacorn valuation when it raised $700 Mn from the US investor in 2022.   

Things took a turn for the better when Swiggy CEO Sriharsha Majety claimed that the foodtech unicorn’s food delivery business achieved profitability as of March 2023, excluding ESOP costs. Investors also displayed renewed confidence, with Invesco marking up Swiggy’s valuation by nearly 43% to $7.85 Bn and Baron Capital internally raising the valuation by 33.9% quarter-on-quarter to $8.54 Bn.

Creative, Relatable & Witty: How Zomato Campaigns Capture Foodies  

Innovation-driven marketing is a major growth driver in today’s business scenario, and Zomato has vroomed into that space. Take, for instance, the age-old SEO tools consistently driving traffic 24×7. According to traffic analyser Ubersuggest, Zomato ranks in India for 2,494,988 keywords as of August 2023, with monthly organic traffic amounting to 30,484,205, as mentioned in an IIDE (Indian Institute Of Digital Education) report. Although these figures are a tad lower than its SEO performance in February 2023, Zomato has outperformed Swiggy by 2.5 times.

However, the company has taken the cake in the social media domain.

Zomato and Swiggy are active on major social media platforms like Instagram, Facebook and X (formerly Twitter). As of November 2023, Zomato has 891K followers on Instagram, 1.9 Mn on Facebook and 1.5 Mn on X. Swiggy is a notch down, with 457K followers on Instagram, 999K on Facebook and 209K on X.

Zomato’s ability to attract and engage people on every medium can be attributed to its use of trendy and witty posts. For instance, a recent collaborative campaign with Blinkit tweaked a famous Bollywood dialogue, leaving people in splits. While the Blinkit billboard turned the original dialogue on its head and said: Doodh mangoge, doodh denge (Ask for milk, and we will deliver it), Zomato took a page from it and made a humorous addition: Kheer mangoge, kheer denge (Ask for kheer, and we will deliver it). 

Then there are other campaigns – the story of Raksha and Bandhan, Zomato vs Zomato and Humans of Zomato – which are equally intriguing and never fail to captivate consumers. A recent case study by IIDE also highlighted the food delivery giant’s effective strategy of creating witty and relatable content to enhance engagement and appeal to its audience.

Moreover, when Zomato’s founder and CEO, Deepinder Goyal, joins the upcoming season of the popular TV show Shark Tank India, the event can set social media on fire. The company will not let go of this opportunity to impress netizens.

As global customer reach is its primary objective, Zomato utilises every available digital marketing tool to understand the preferences of its target audience and cater relevant content. According to the digital marketing agency Ideatick, the company sticks to a creative marketing strategy to stay at the forefront of the industry.

That does not mean Swiggy is lagging. The company has earned industry acclaim for its skilful storytelling, exemplified by its famous campaign What’s In A Name, where it ingeniously weaves relatable stories around restaurant names. Swiggy typically looks at people’s hunger quotient to craft a comprehensive marketing strategy, epitomised by its timeless tagline: Craving Something?

It also captivates its audience with visually compelling content and relevant Indian topics, ranging from cricket to political unrest. Again, pictures of delicious food are promoted on Instagram to position the company as the go-to choice for those desiring delectable meals.

Recognising the fast-growing significance of memes in the new millennium vernacular, Swiggy infuses its distinct flavours into them to enhance customer interaction on social platforms. A notable example is its viral Vadapav meme on Instagram (posted in September 2022), which got more than 1.2 Mn views and 5K comments, showcasing the effectiveness of this approach.

2024 Outlook: Competitive Sparring On The Menu

According to a Statista report, the number of users across the meal delivery market in India is estimated to reach 346.6 Mn by 2028. This anticipated surge in user numbers has transformed online food aggregation and delivery into a highly lucrative segment, attracting new players and investors. 

So, it is not surprising that startups like Waayu and Thrive, as well as the Indian government’s ambitious digital commerce network ONDC, are challenging the longstanding duopoly of Zomato and Swiggy.

Interestingly, WAAYU distinguishes itself as a no-commission food delivery platform, backed by Bollywood actor and investor Suniel Shetty and supported by the Mumbai-based Indian Hotel and Restaurant Association (AHAR). The startup charges an introductory fee of INR 1K per month per outlet, which will be doubled a month after the onboarding. Restaurants also have to pay a one-time onboarding/setup fee of INR 3,650.

Another noteworthy contender is Thrive, a foodtech platform supported by Coca-Cola. It collaborates with restaurants for online and WhatsApp ordering, order management and setting up digital menus. Thrive claims to have a large restaurant base (exact number not disclosed) as it charges a 3% commission compared to 18-25% levied by Zomato and Swiggy.

The presence of ONDC makes the market more competitive as it has already onboarded more than 50K restaurants, signalling a tough time ahead for Zomato and Swiggy. 

As we approach 2024, the fate of these industry leaders remains uncertain. Only time will tell if they can operate in a stable market and grow sustainably, or it will continue to be a roller-coaster ride.

[Edited by Sanghamitra Mandal]

The post The 2023 Face-Off: How Zomato Powered Past Swiggy In The Food Delivery Race appeared first on Inc42 Media.

The year was 2017 and four Flipkart executives decided it was time to disrupt the investment tech market. But Lalit Keshre, Harsh Jain, Neeraj Singh and Ishan Bansal had a different view of fintech than most entrepreneurs who jump into this sector. The result was mutual funds distribution platform Groww, where the consumer-first mindset is still paying off.

“We come at problems from a consumer lens because that’s what we know best. Solving problems that customers and consumers face has been our biggest learning at Flipkart,” Jain tells Inc42 at Groww’s HQ in Bengaluru, where nearly 40% of all Indian unicorns have their bases.

But unlike many of its neighbours, Groww has had an optimistic 2023. Jain seems nonplussed when I ask him what it feels like to finally turn profitable as a group. As per him, profits are a byproduct of Groww’s approach to solving the problem.

“We haven’t done anything different, and profitability is just one of our goals. In fact we never had this as a target in our mind that next year we will be profitable. Because we trust that the process of being consumer-first will pay off,” he says, reiterating Groww’s focus on solving consumer problems, which has brought in the results as far as profits are concerned.

Beyond profits, Groww reached another landmark with 6.63 Mn active investors at the end of September 2023, as against Zerodha’s 6.48 Mn. This made the company the biggest discount brokerage by clients in India. For context, Groww had 5.3 Mn active investors at the end of 2022, compared to Zerodha’s 6.3 Mn.

And there’s one more reason why 2023 has been different for Groww — the company’s plans to venture beyond investment tech are becoming clearer and clearer. In other words, Groww too is joining the super app race in some ways, though these are still early days in that regard.

But the blueprint has been laid out — if Groww grew to its current stature on the back of mutual funds and stockbroking, its future could very well be determined by what it took on in 2023.

Firstly, like most other fintech unicorns, Groww jumped onto the lending bandwagon in late 2022, and in 2023, it also entered the tightly contested payments vertical. Effectively, Groww is joining the likes of Paytm, PhonePe, CRED, BharatPe and others in this space, although its lynchpin product remains investment tech.

But as Jain is keen to point out, the approach will be consumer-first. We wanted to understand what that meant for Groww and how the company has leveraged this direction to outgrow long-time competitor Zerodha in some ways.

Our visit to Groww’s headquarters was a part of Inc42’s 2023 In Review series, and we wanted to dive into the fintech unicorn’s journey in 2023 as it prepares for a brave new leg in 2024 with a slew of new products. Here’s what we learnt:

Groww’s Content Stack

At one point during our conversation with executives, Groww is often referred to as a D2C company. The direct-to-consumer model is more commonly used with ecommerce, but even there, the model has become diluted through multiple channels and distribution points.

But in the case of Groww, the approach extends to how the company thinks about new products and verticals.

Another senior executive at Groww tells us that the company’s key strength has been able to convince even on-the-fence customers that investing is not rocket science. The content-to-commerce chain is something D2C brands have tried to leverage for growth. But in the case of Groww, this extends to handholding customers through tough financial decisions via content and allowing them to take charge of their investments in a transparent manner.

The first step is not treating new investors any differently than existing customers except when it comes to content. The end goal for both cohorts of users is the same, Jain reminds us, which is to manage their money better.

Often, discount brokerages get stuck in their positioning around casual or serious investors, and this tends to make it harder for the platform to grow unless the market matures. For Groww, content and its educational initiatives have been the great leveller.

“There’s no such thing as a casual investor. If someone earns INR 15K a month and invests INR 500, they are making a very serious financial decision. So content is critical to help them make the right choice,” the executive mentioned above adds.

Unlike new investors, those who are already familiar with the market and investment strategies need a different degree of assistance from a content POV. There’s also a focus on localisation of content through regional language videos that simplify strategies for new investors.

Localised content is a key pillar for Groww, as we will see, because this ties into the company’s larger plans around lending and other verticals.

Yet, there’s a governance aspect to the content being produced as well, which guards the company against the temptation to bombard new users with content just to drive growth. While many rival investment tech platforms have brought in influencers to bolster content, Groww does it all in-house.

Influencer-led investment marketing has earned a bad reputation in recent months, and Groww does not want to go into this model. On YouTube, it has nearly 2.15 Mn subscribers, compared to Zerodha, which has less than 600,000 followers. Groww launched its YouTube channel in 2017, compared to Zerodha’s 2014 launch.

Instead of relying on other investment experts, Groww prefers a DIY approach when it comes to users Influencer-led investment content has brought trouble for platforms such as Vauld and others in the past, and even market regulator SEBI is cracking down on unauthorised selling.

“We don’t even give our business teams targets to increase transactions, so asking someone like an influencer is out of the question. Again, we wanted to focus on solving for the consumers which influencer-led marketing does not do,” adds cofounder Jain.

Jain believes that not chasing growth has brought the growth that Groww has seen in the past year. “If you do right by the customers, they will stick with you, and eventually each user becomes more profitable. We won’t change this philosophy just for growth.”

In 2021, Groww saw its valuation jump from $250 Mn to $3 Bn+ thanks to massive funding rounds and backing from the likes of Tiger Global, Lone Pine Capital, and many others. The company has since then expanded its lineup of investment tech products, as highlighted above, and added more pieces in 2022-23.

From A Lending Play…

It’s hard to hide from the competition in the fintech space. One way or the other, you will cross paths.

The great fintech convergence is one of the more enduring themes of the past year, as individual apps turned to platforms. Groww is also a platform in many ways, but key leaders in the company believe the difference is in the way it has approached this transition.

Thoughtful product expansion has been the hallmark of CRED in 2023, while massive deployment of capital and resources has been the playbook for PhonePe. Groww has taken customer-first to a different level. And for the company, this is a key USP because it creates a long-term trust bridge between the platform and its users.

“For many days in the past year, our founders have been on the ground and talking to customers directly. We had roadshows to meet some of our most active investors in Tier 2 and Tier 3 towns, where we saw that our customers have deeper problems and a trust in Groww,” says another key member of the Groww platform.

The trust comes from the fact that Groww has helped these individuals see returns on their wealth. Users know that Groww is a legitimate partner and therefore they are more likely to turn to the company for other services.

Based on the feedback from the users on the ground, Groww added lending as the first piece of the platform beyond investments. It had also acquired an NBFC licence through Groww Creditserv Technologies in late 2022 for its first real attempt into lending, and by mid-2023, it had also ventured into UPI payments.

…To Joining The UPI Race

Let’s get one thing clear — UPI is not exactly a novel product by any means and can be expensive to maintain at scale despite its low revenue contribution given the current zero MDR regime.

Even market leader PhonePe struggles to monetise UPI and has to turn to non-payments revenue for growth. But UPI is a glue in the fintech ecosystem and every app realises that UPI can be a top funnel to gain more users.

Groww ranked 28th among all UPI apps in October 2023, facilitating 5.89 Mn transactions totalling INR 3,354 Cr in value. As such, it has a long way to catch up with PhonePe, Google Pay, Paytm and CRED, which are the top four UPI apps in India.

While other companies spend to drive usage, Groww is looking at UPI as a nice-to-have and not as a core focus area. UPI only adds to the trust element of a platform.

Sources close to the company told Inc42 that Groww is also working on a payments gateway business, which is being used to reconcile transactions made by investors on its app. It’s very likely that the company will offer it to other businesses to recoup the investment towards building this product. But Groww did not comment on the plans to enter the enterprise fintech space.

What Can Groww Count On?

Trust is a fundamental building block for any platform, says a founding partner at a Bengaluru-based early stage VC firm. The partner, who primarily looks at fintech investments, believes that fintech platforms need to become walled gardens and there are various ways in which companies are doing this.

Paytm has the deep brand value, CRED has cutting-edge product and design, PhonePe has the scale — for Groww, this is replaced to some degree by the trust from its customer base.

On the lending side, the company has looked at consumer durable loans at the points of sale as well as merchant loans to begin with, but according to sources close to the leadership, there are plans for home loans, personal loans and other credit products.

But the company’s plans are not just restricted to lending. Reports in the past year indicated that Groww is also looking at a co-branded credit card and there was even some speculation earlier about a tie-up with Federal Bank for a neobanking play. These are very much on the cards as well.

Interestingly, Zerodha, Groww’s chief rival on the investment tech side, is also eyeing a banking licence, as per reports. A banking licence is being considered a critical advantage in the discount broking space for speed of executing transactions. As more and more companies look to automate processes for a quicker turnaround time on transactions, having an in-house bank would be a massive competitive edge.

So Groww’s primary objective with its content stack is to inform — and that was also the objective with meeting people on the ground. It’s not about bringing new users, but building trust and visibility with the brand.

If digital-first new-age brands do it through retail channels, Groww does it with roadshows.

Rethinking Asset Management 

Groww’s NBFC licence keeps the door open for a larger banking play in the future, but another critical factor is the new asset management business.

Earlier this year, Groww completed the acquisition of Indiabulls’ AMC licence, a process that began in 2021. For Groww, the AMC licence is critical from a revenue point of view as AMCs typically charge a management fee based on the asset percentage, while brokerages generally charge per trade or offer flat-fee accounts. But for Jain, the opportunity is not about revenue but actually changing the trust equation.

Once again, Groww links the product expansion to consumer-first thinking. The consumer does not want the business to ask for money to solve the problem. The consumer wants to see the value of the brand, and needs to trust the brand to solve the problem.

“There is a lack of trust in the industry because products are not very simple. Customers or new investors need a very simple report. They want to know how to invest. They ask, ‘How do I get the money back? Where is it invested? Is it invested with the right philosophy? Are people taking too much risk or are they very conservative?’ We have the opportunity to create that level of transparency with our AMC and that level of governance,” Jain said.

As per him, Groww’s approach to content and solving the problems faced by consumers easily extends to other categories such as insurance. In other words, it’s not just the AMC space or the investment space that is fraught with bad information.

Sources at Groww talk about insurance as one of these areas and how it has remained a mystery product for certain categories. “Think about life insurance. It is the most critical product for long-term financial planning, but it’s the least understood product and it’s the most mis-sold product. There’s the need to demystify this in the right way and no one is doing that yet,” one source close to the management says.

Groww’s Super App Moment 

Once again, content is the answer for Groww because the questions the company is asking itself are the questions that the consumer has. Even if content does not always translate into monetisable users, there’s a strong belief that investment tech, mutual funds or even fintech as a whole is not a winner-take-all market. Growing the base of eventual users only helps the ecosystem.

Groww might be more suitable for one kind of consumer, because it has a deep consumer insight. But there will always be room for other companies, just like a healthy economy has multiple banks competing.

Despite having higher active user numbers, Groww trails Zerodha in terms of revenue. Nithin Kamath-led Zerodha reported INR 6,875 Cr in revenue and a net profit of INR 2,900 Cr in FY23. In contrast, Groww reported a net profit of INR 449 Cr in FY23 on an operating revenue base of INR 1,277 Cr.

The gap is evidently wide, but comparisons with Zerodha are perhaps misrepresentative of Groww’s place in the fintech ecosystem. Or, at least, will be if the company is able to press the accelerator on its larger plans.

Indeed, the comparisons then will be made with the likes of Paytm or PhonePe, and it will be interesting to see where each of these fintech ‘super apps’ stand a year from now. Will their product diversity stand the test of time?

In some ways, Groww has been lucky so far that the company’s products have been well timed with the market growth and the push for investments in India from policymakers. Plus, digital investment platforms grew by leaps and bounds during the Covid pandemic aka one of the biggest bull runs in India.

Even though the past few years have brought in some correction, Groww believes in taking a broader decade-long view. The aspirations of modern Indians are already growing and this is also an important time to help Indians grow in the right manner.

The cofounder believes that just like Groww got ‘lucky’ in the past few years with its core business, it has the good fortune to be building new products for this new India. Incidentally, this is also the best time to prove any thesis around super app platforms as the consumer base is maturing.

And Groww says it knows consumers well — will this be its trump card?

The post Groww’s ‘Super App’ Year: Going D2C To Win The Fintech Race appeared first on Inc42 Media.

CRED doesn’t do labels — ask the company to name its key leaders, and there’s no straight answer. The refrain time and again is about functional teams and high ownership across the ranks.

But I wasn’t at the company’s new second office in Bengaluru to discuss official designations. Instead, we wanted to dive into the year that went by with the leadership. And I couldn’t help but notice an airier, more open version of the company which is otherwise quite guarded.

After all, 2023 is a big year for CRED — it’s about the coming-of-age for the company’s products and embracing the platform life and proving that financially too, it is on the right track. With new products that could add significant revenue momentum, CRED is answering many who had questioned its business model for years. This year was also about showing that building patiently and slowly has its rewards.

With its new office, the Kunal Shah-led startup has now bookended an entire block on Indiranagar’s 100-foot road, creating what can only be described as the CRED bubble.

The CRED bubble is, of course, not a bad thing. It’s largely indicative of Shah’s outsized influence on the Indian tech ecosystem. Naturally, most people associate CRED with its founder — the only designation that cannot be hidden.

Having completed five years in 2023, CRED is finally opening up, even though it’s awkward about it.

As part of Inc42’s wrap-up of 2023, we dove deep into the year gone by for CRED and unearthed some insights from how the startup builds its products, its relatively slow-burn approach and the questions about profitability.

‘CRED’s Broad Canvas’

For CRED, the benchmark is not Paytm or PhonePe or any other fintech app, it’s Apple and Mercedes — no surprises there (more on this later). It’s the one thing that perhaps sets the startup apart from the horde of competitors in the rapidly growing fintech space.

Every company is gearing up to become an all-in-one fintech app, but CRED claims to have taken a deliberate approach, without compromising on the product ethos — deeply thought-out features, high-quality design assets and UX, and products that fit into CRED’s customer persona model, which make sense for the platform.

“Kunal had a very crisp vision of what the opportunity is, which is that the trustworthy and credit-worthy user base in India deserves better, and can be served in a unique way. That was the broad canvas and that canvas is still the same today,” says the company spokesperson, adding that the primary challenge for CRED from a product vision point of view is choosing what to do next.

Choosing what to do next is not something most startups have the luxury of. In CRED’s case, that’s largely due to the capital raised by the company that allows it to take its time, but it also goes deeper than that. Shah’s reputation as a founder who has seen a big exit also brings a lot of time to grow.

The company has raised over $1 Bn over 10 rounds in five years, so it’s not lacking capital. But it’s also about knowing what pieces of the puzzle will actually fit next to each other.

“You really cannot do step seven, unless you do step one through six. And then you may imagine I want to do step 27 also, but you don’t get the right to do that until you sort of actively build the layers and things adjacent to it,” the spokesperson said.

‘Is This A Delta-4 Experience?’

So when did CRED choose to go into something like vehicle management with CRED Garage, which came out of the blue, but fits like a glove within the platform. After the launch, it seems like a very obviously CRED product, but how did the company arrive at that point?

For the company, it goes back to the underlying thesis of building for the ecosystem of people who are high-trust, which is based on an objective metric called a credit score. In some ways, this cohort represents the cream of the overall Indian fintech TAM. Essentially, the very premium layer comprises the 100 Mn Indians who own a credit card.

“So when we look at the problem statements that they have in their life where we can potentially make a difference. That’s the starting point of how we think about all products, not just Garage. There are some products which we aspire to make, but until we have a unique insight that fits this persona, we’re not gonna go build it.”

The origin point for Garage was more than a year before the launch when the CRED team was ideating on developing a product linked to FasTAG electronic toll payments. By itself, the product would have been just another FasTAG service like Paytm or PhonePe, but the idea was to flesh it out more fully.

Another decisive question that CRED asks itself in the process of product development: ‘can we create a Delta 4 experience’, based on the theory put forward by Shah. Put simply, Shah claims, “Once the user experiences a significantly better way of using a product, there is no way he or she is going back to the old way of doing things.”

The company claims a product like Garage doesn’t exist anywhere in the world, and it’s similar to how CRED changed credit card bill payments, which seems like an afterthought today, but it was also a unique product at the time. In the first three weeks, CRED Garage claims to have hit 1 Mn vehicles registered.

Building backward from the customer persona, CRED is looking to intersect with the digital commerce and lifestyle journey of its users. Besides, the company is also eyeing investment tech vertical as the next area of growth.

Garage is also unique in the sense that CRED did not acquire any companies to build this product, as it has done on the lending side with the acquisitions of CreditVidya in 2022 or Spenny in 2023 or even the likes of Happay in 2021.

While these acquisitions are key for CRED’s grander plans in the investment tech and lending space, Garage remains a wholly unique proposition.

What’s not unique is CRED’s UPI play, but even here the company banked on building for the customer persona, which has paid off in a big way.

‘Why’s Yours Black And Why’s Mine White?’

For years, fintech meant payments and payments meant UPI. Startups built user bases through UPI and now realise they need services for revenue, something which UPI does not contribute towards.

In October 2022, when CRED launched UPI payments, we wondered whether it was too late to enter the game. But since the launch, the company has managed to climb up the UPI rankings and is the fourth-most used UPI app in the country today.

The launch of UPI has been critical for CRED to drive engagement among its users and it’s also one of the places where we can see the product philosophy pay off. “It was an important piece in the puzzle as it ties the various verticals together and you can see the impact in terms of the financials and the growth,” says a Bengaluru-based founding partner at an early-stage VC firm that has invested in several fintech startups.

Unlike other players of its ilk, CRED decided to take a gradual approach to UPI, launching nearly half a decade after the likes of PhonePe or Paytm or Google Pay. And it helps that perhaps people want to try new apps for UPI because there is no cost involved with switching apps.

“The paucity of rewards on other apps after five long years meant CRED had the opportunity to offer rewards and syphon off users. Users ant rewards and delight, and CRED offers both in spades,” the spokesperson added.

We asked CRED team what led to this quick success for CRED UPI, and the answer was — people use different signals for different transactions.

Someone with multiple credit cards will likely pull out the fanciest one in the right company, and the same could be said about CRED’s UPI play. “There’s the factor of ‘Why’s yours black and why’s mine white?’ We also focussed on speed, safety and privacy. We have the fastest QR scanner today and we have fraud protection measures, which is basic but no other app has done that,” the spokesperson said.

The UPI product has been key in converting the user base from low-frequency actions for credit card payments to high-frequency actions like daily small-ticket purchases. And indeed, Garage or CRED Escapes (travel) or the CRED Store are all part of this effort to push up engagement among the most active users.

‘Building Like Apple Or Mercedes’

Products by themselves don’t matter of course. It’s about how they move the revenue needle. For CRED, the FY23 performance is seen as a turning point, but there’s an even more meaningful outcome that the company had been chasing for — higher engagement from its users.

The startup reported a total revenue of INR 1,484 Cr in FY23, a 251.6% increase from INR 422 Cr in the previous fiscal year. On the other hand, losses grew marginally at 5% to INR 1,347 Cr, thanks to expenses growing to INR 2,831.9 Cr from INR 1,702 Cr.

On the engagement side, an average CRED monthly transacting user (MTU) now opens the app more than 20 times a month, which the company claims is one of the best in the industry.

One-third of the credit card bill payments by value were done on CRED, we were told and on a unit economics level, CRED spent INR 2 to earn every single rupee from operations.

That’s a major improvement from INR 4.3 it spent last year to earn a rupee of operating income. So, there have been some measurable improvements for CRED in the past 12-16 months, and new products are very clearly a part of it.

For CRED, financial prudence is not new, and in fact, the company claims to be CM1 positive for seven quarters now and CM2 positive for five quarters (as of December 2023). These are of course the fundamentals that indicate the right trajectory from a unit economics point of view. And these metrics will be sacrosanct — or in other words, they won’t be sacrificed for growth.

As for EBITDA breakeven, for CRED and many other companies at a similar stage, it’s a choice. The company is likely to invest in growth if there are products worth chasing.

The company also claims to be ahead on its plan for EBITDA breakeven, without stating any timelines for when that might be announced. Perhaps, it’s the company’s shyness for labels that’s once again surfacing here.

But even the likes of Google and Amazon faced questions on profitability and their business models before they went public. Until the larger vision and the business fundamentals became clearer. CRED is not in a hurry to claim profitability.

The analogy we were given is of Apple or Mercedes. The best companies in the world take their time because they are pushing the envelope on products. Whether that be a car or a smartphone or laptop or indeed a fintech app. These titans of industry have earned the right to garner the largest share of profits or goodwill among customers.

Of course, success is a factor of the work and not just patience. For the company, the key will be to fight, perform and deliver every day; becoming less and less quiet about the progress. And then perhaps CRED might not shy away from labels as much.

Update | 11th Dec, 9:40 IST

Some parts of the story have been edited for clarity.

The post Five Years In The Making: CRED’s Year Of Vindication appeared first on Inc42 Media.

A landmark fine by the Competition Commission of India (CCI) on Google in late 2022 set into motion a series of events that echoed well into 2023. The domino effect led to a turbulence that hit Google’s ship, a force to reckon with and a digital juggernaut. 

Emulating its global operations, 2023 turned out to be a tumultuous year for the big tech major in India as well. The CCI penalty emboldened Indian startups to take the company to courts and even paved the way for the homegrown ecosystem to wrest control of a key industry body (IAMAI) from Google.

Piling on top of these issues were other anti-competitive cases brewing in the news aggregation and the smart television space. 

Besides, as a flurry of legislation, centred on the country’s digital ecosystem, took shape this year, Google found itself in the crosshairs of the government. Be it rap from authorities for failure to crack the whip on fake news or the emergence of deepfakes, the year turned out to be a trying time for the big tech giant.

Macroeconomic headwinds too hit the company as layoffs brought bad press for the big tech giant.

Notwithstanding these challenges, Google continued to focus on India, its biggest market globally in terms of users. 

From chief executive officer (CEO) Sundar Pichai’s bonhomie with Prime Minister Narendra Modi to moving some of the production of Pixel smartphones to India, Google left no stone unturned to tout its India push. 

The year also saw Google bolster its fintech ambitions while rolling out new AI offerings for its Indian audiences. While 2023 indeed was, in some sense, a mixed bag for the company, unease prevailed among the company’s top leadership over regulatory strife and legal cases stuck in limbo.

Google Caught In The Great Indian Legal Limbo

As the competition watchdog issued a landmark antitrust judgement against Google in October 2022, little was known that it would stir up a big storm for the company. 

The CCI slapped two separate fines, totalling over INR 2,200 Cr, on Google for abusing dominance in the Android devices market and over its Play Store policies. It also directed the US-based major to undertake sweeping reforms to its operations in the country. 

Refusing to take the order lying down, the company appealed the decision before the National Company Law Appellate Tribunal (NCLAT). 

As cases dragged on, Google was forced to change course and instituted a slew of changes to India operations. It made some changes to its agreements with original equipment manufacturers (OEMs) and even announced a new user choice billing system (UCBS), which slashed developer commissions to 11-26%.

However, as Google began rolling out new policy changes to comply with the CCI rules, it met an unexpectedly tough adversary — Indian startups. 

First on the menu were public statements by Indian startup founders, trashing the new billing policy and equating it with British-era ‘Lagaan’. Some even termed Google a threat to the country’s startup ecosystem. 

What followed was Indian startups banding together to file cases against Google’s UCBS in Delhi High Court and Madras High Court. The homegrown players even approached the NCLAT and other stakeholders to pitch their case against the new policy.

As this saga played out, many founders were irked by the silence of industry body Internet and Mobile Association of India (IAMAI) on the matter. Consequently, the startups trained their guns on the industry body, which, as per many founders, was controlled by big tech executives. 

The aftermath saw Indian founders participate in huge numbers in the IAMAI’s elections and wrest its control from Google representatives – a small win for the Indian startup ecosystem.

In the middle of all this, it was the regulatory standoff that seemed to be the biggest trouble in Google India’s paradise.

Google’s Regulatory Pitfalls In India

A recurring theme of Google’s operations in India has been its behind-the-scenes, if not always public, skirmishes with the government. As the government undertook the overhaul of key digital laws in 2023, Google found itself in the middle of the action. 

While the amended IT Rules brought the safe harbour protections into question, the Telecommunication Bill hinted at the possibility of regulation of its OTT communication apps. The Digital Data Protection Act proposed an elaborate set of homework, hefty fines and additional compliance burden for the Sundar Pichai-led company.

The emerging threats such as deepfakes as well as misinformation, ahead of 2024 general elections, has also put the company in the crosshairs of the union government. 

In a bid to tide over this, the company has largely resorted to its time-tested strategy of engaging with authorities behind closed doors, partnering with the Centre on a slew of initiatives, and emboldening its Make in India push. 

Be it the production of Pixel smartphones in India or launching accelerator programmes for Indian startups, in partnership with MeitY, Google pitched itself as a force dedicated to the cause of the Indian digital economy. 

Meanwhile, the company continued to shore up its fintech ambitions, looking to capitalise on the burgeoning number of Indians joining the digital fold. 

The India Ambition Scales Up

Google continued to heavily scale up operations to capture a bigger pie of the Indian digital economy, which is projected to soar to a market size of $1 Tn by 2025. 

Diversifying from offering mere digital payments services, the big tech major forayed into the financial services segment. In partnership with Indian banks and startups, Google Pay, starting 2023, began to offer merchant credit lines and sachet loans for consumers.

With an eye on accelerating its fintech growth, Pichai also announced that the company would set up its global fintech operation centre at the GIFT City in Gujarat. 

Capitalising on GenAI, the flavour of the season, Google announced a spree of AI-focussed launches this year. Be it Bard or visual search, the tech giant rolled out a host of AI-led products and services for its Indian users even as competition intensified from Sam Altman-led OpenAI. 

Meanwhile, it continued to feel the heat of the global economic meltdown that unfolded in 2023. As a result, Google undertook a cost cutting exercise to streamline operations which resulted in axing of more than 450 jobs in India. 

The Mountain View-based company also shut down and announced the discontinuation of a slew of products and services, such as Google Podcasts, Google Stadia, and Google Jamboard, to focus on actual money-minting products. 

In India, YouTube also shut down its live social commerce app Simsim, just two years after the streaming giant splurged millions of dollars to acquire the Indian startup. 

What 2024 Holds For Google?

After a turbulent 2022 and 2023, Google has work cut out for itself in 2024. With general elections around the corner, Google could be in the spotlight as apprehensions grow over misinformation and negative use of generative AI.

While its legal troubles and standoffs with government authorities are expected to continue well into next year, the company could be hoping for some relief from Indian courts as it charts its path ahead in India.

The company will also continue to pump millions of dollars to roll out GenAI offerings, especially its GPT-4 rival Gemini. The suite of AI products will largely cater to consumer-facing products while it straddles potential regulations for the emerging technology. 

The world is also expected to return to sanity as macroeconomic pressures ease, paving the way for healthier revenues for the big tech giant. While the antitrust rulings are expected to continue, the company will continue to scale up its presence in India, focussing more on vernacular media and tapping into the growing Indian population that wants to access the internet in their own language.

The post 2023 In Review: A Year When Digital Goliath Google Met Its Adversaries In India appeared first on Inc42 Media.

Just when Paytm seemed to be on track to hit profitability, there’s another speed bump. And this time around, Paytm doesn’t just have to slow down but also swerve to avoid a crash.

This week’s withdrawal of the company’s low-ticket Postpaid feature or buy-now-pay-later (BNPL) service has created a difficult situation, as this was one of the key success factors for Paytm’s profitability in the past few quarters.

And while Paytm has denied that this is the end of BNPL on the app, it’s looking increasingly like that given that the new focus is higher ticket loan sizes.

The BNPL loan book had become a critical monthly recurring revenue for Paytm and the changes could derail Paytm’s run towards profits. But before we look at that, let’s take a detour into the top stories of the week from our newsroom:

• ZestMoney’s Last Days: ZestMoney is shutting down after a torrid time this year. But what happened at the fintech startup that was flying high at one time? Here’s a look at the last few days of ZestMoney.
• Year Of Shutdowns: More than 15 startups had to shut shop this year after being pushed to the brink by tough market conditions — Pillow and FrontRow were some of the big names that bit the dust in 2023
• Layoffs At Simplilearn: Inc42’s exclusive report on how Blackstone-owned edtech giant Simplilearn has laid off 200 employees citing performance reason, which employees allege is not the full picture

Paytm Postpaid’s New Avatar

First, let’s understand the sequence of events leading up to the changes at Paytm. In late November, many users reported on Twitter about being frozen out of Paytm Postpaid.

Then reports emerged this week about Paytm halting Postpaid operations, which the company denied after a swift press conference. Finally, in a call with investors and shareholders, Paytm said it is not halting Postpaid, but recalibrating the portfolio origination of less than INR 50,000.

It claimed to have taken this call on the back of recent macro development and regulatory guidance, in line with its focus on driving a healthy portfolio. “While we’ll continue to do postpaid, and it may not be the same growth level that we were doing earlier, it will be significantly lower than what we were doing earlier, but it will be a product that will continue,” the fintech major told investors.

Given the recent RBI directives to banks and NBFCs to increase the risk weights — the amount of cash banks need to reserve to service risky loans — which has forced the banks and NBFCs to reassess their portfolio. As a result, agreements with the likes of Paytm which offer small ticket loans are being reassessed.

One Delhi NCR-based fintech founder says even banks and NBFCs need to show improved profitability and these small loans do not contribute to their bottom line significantly.

What Postpaid Means To Paytm

Losing the key low ticket size segment of Postpaid is a blow to the company’s financials. While it has admitted that future growth will be slow, the company would also be wary of value erosion due to any slowdown in its lending business.

Paytm has posted staggering growth in the lending vertical in the last quarter i.e. Q2 FY24, where disbursals increased to 1.32 Cr loans (44% higher YoY) and the total loan amount to INR 16,211 Cr (122% higher YoY).

But how much of that is from Postpaid and what can we expect come next quarter?

The Postpaid vertical has historically contributed the biggest to its lending business in terms of value. In Q2, Paytm disbursed Postpaid loans worth INR 9,010 Cr, which is 12% higher than what the company did in Q1. Interestingly, loans under INR 50,000 made up to 75% of the total disbursements, and this entire chunk is more or less out of the picture.

Even if we assume some overall growth for Postpaid in Q3 FY24 (December 2023), Paytm is looking at significantly lower revenue on the lending side.

The nature of Postpaid meant that a lot of Paytm’s young users without credit cards were using the BNPL credit line like a credit card. Postpaid also had wide acceptability in the offline merchant space, making it more attractive than the likes of LazyPay and others which offered a similar feature.

Paytm’s Value Tied To Lending 

For Paytm, the decision to defocus from the low ticket size means that it will likely lose out on the traction it sees from users due to Postpaid usage. It’s a double blow along with the revenue, and one which has decimated Paytm’s stock.

After a rally throughout most of the last few months, Paytm’s market cap tumbled from INR 55,256 Cr to INR 41,373 Cr in a week, a fall of 25%.

Brokerage Motilal Oswal believes Paytm’s loan disbursement run rate is expected to decrease from INR 6,000 Cr per month to about INR 4,500 Cr. “Paytm adds an average 3.5 Lakh to 4 Lakh customers every quarter, which is now expected to come down by 50%,” the firm claimed.

Similarly JM Financial noted that Paytm’s FY24 estimated loss before tax is likely to increase by 11% as a result of the changes.

BNPL’s Time Running Out 

But of course, BNPL was never a reliable ship. The segment has had its share of worries for a long time. Plus, this particular Paytm episode highlights the weakness of relying on a base of low-value loans.

Analysts expect several other companies to also focus more sharply on higher loan tickets where a higher standard of risk assessment and diligence is needed, rather than the blitzscaling of BNPL startups and the associated irresponsible lending.

“BNPL was always a sticky wicket and it’s no surprise when you see that with each RBI intervention, the segment sees great pain. And even the valuation bubble is now burst, so the time is for responsible lending and not spraying capital around,” said one Delhi NCR-based fintech founder.

BNPL startups such as Simpl and Slice which had models similar to Postpaid’s credit lines have pivoted to other models since then, and even Lazypay introduced personal loans to hedge against any slowdown in BNPL.

Speaking to Inc42, Kissht/RING founder Ranvir Singh added that lending by itself is too big and too ingrained into the economy to slow down. What we might see is better governance standards in lending operations. Kissht claims to have an average ticket size of INR 1.1 Lakh.

“Though risk weights for unsecured loans have increased, there is an elevated interest from lenders and co-lending partners to disburse loans greater than INR 50,000. This will further usher an era of more responsible lending where credit worthy customers will continue to be served adequately,” Singh said.

Can Paytm Refocus?

For Paytm, the answer lies in adding more partners for its personal and merchant loans, where it will be looking to make up most of the lost Postpaid revenue. These areas are typically more lucrative for revenue and long-term profits, but building a large loan book requires a lot of legwork.

In the initial days, Paytm is likely to have to spend heavily on customer acquisition and even then it will need to keep a high bar for disbursing loans. Shifting focus to larger ticket loans is not without challenges, given that besides higher risk weights, there is the FLDG component, where partner financial institutions are likely to ask digital lenders to put up collateral.

Lending might continue growing as a whole, but Paytm will have to fight harder for its share of the pie.

2023 In Review: Recapping The Highs And Lows 

As 2023 draws to a close, it’s time to reminisce about everything — from the key deals to breakthroughs from trends to controversies in the Indian tech & startup ecosystem. Like every year, Inc42 launched 2023 In Review in late November and throughout the past few weeks, we have captured the year through snapshots and analyses.

This week, we looked back at the startups that turned profitable in FY23 and set off on a new trajectory. Plus, our roundup of the sport stars and athletes that turned investors, as well as those who continued to back new-age ventures. And while 2023 was not a massive year for IPOs, some startups managed to buck the trend and go public despite tough market conditions.

Bookmark this page to see what we have in store!

Sunday Roundup: Tech Stocks, Startup Funding & More

• Slow Year For Funding: With the year about to close, Indian startup funding is likely to just breach the $9 Bn mark. Between December 4 and 9, startups raked in $85 Mn across 18 deals
• OpenAI’s India Plans: Sam Altman-led OpenAI is reportedly partnering with former Twitter India head Rishi Jaitly to help facilitate talks with the Indian government about AI policy

• SoftBank Sells Zomato: SoftBank offloaded 9.35 Cr shares of foodtech giant Zomato this week in an INR 1,127 Cr block deal, most likely completely exiting its position
• Another Boost For UPI: The RBI has proposed increasing the INR 1 Lakh limit for UPI payments to hospitals and educational institutions to INR 5 Lakh per transaction among other changes

That’s all for this week folks. We’ll be back next week with another roundup as we close the curtains on 2023.

Don’t forget to stay tuned to our social media channels during this time of the year. Join Inc42 on Instagram, X/Twitter and LinkedIn for the latest news as it happens.

The post Paytm’s Lost Postpaid Magic appeared first on Inc42 Media.

Call it the year of a prolonged funding winter or the year of corrections, the fact is that investors have not forgotten how their funding was burnt ruthlessly in the name of the rapid expansion of half-done business models and whatnot.

As a result, funding dry spell remained a norm throughout the year, and the world’s third-largest startup ecosystem couldn’t help but mint only one unicorn in 2023 versus 21 in 2022 and 44 unicorns in 2021.

Towards the end of last year, positive anticipations had held their heads high as industry experts saw a funding revival on the cards. However, much to everyone’s dismay, the funding winter seeped into 2023, and the Indian startup ecosystem saw a 75% year-on-year decline in funding in the first quarter (Q1) of 2023.

Besides, the number of deals, too, nosedived 58% YoY to 213 during the quarter under review from 506 in the year-ago quarter.

What triggered this was the inability of a majority of Indian startups to turn a profit, particularly at the late stage.

Corrections continued unabated and the funding winter stretched well into Q3 CY23, marking its 18-month-long journey.

According to Inc42’s latest “Indian Startup Funding Report Q3 2023”, startup funding stood at a mere $1.7 Bn in Q3 2023, the lowest in the past three quarters. On the year-on-year (YoY) basis, it fell 43.8%, while the number of deals declined 38.6% to 205 from 334 deals in Q3 2022.

However, something was different this time. Industry experts saw the country’s startup ecosystem heading towards a renaissance, with founders taking lessons from the likes of Broker Network, BYJU’S, Mojocare, Zilingo, ZestMoney, GoMechanic, just to name a few bad apples.

Interestingly, a keen focus on positive unit economics and effective corporate governance practices was seen returning to the system. Not just this, but away from the gloom and doom, many startups turned profitable this year.

Nevertheless, while the year 2023 had its own set of challenges in terms of investors further tightening their purse strings despite sitting on billions of dollars of dry powder, silver linings did exist. And amid all this, some of the most noteworthy funding deals were inked.

As we stand at the precipice of 2024, we have compiled a list of some of the biggest startup funding deals of the year.

Here Are 2023’s Highest Funded Startups

PhonePe Tops The Charts With A Mammoth $850 Mn Raised In 2023

Even as the entire Indian startup ecosystem was struggling to raise capital and was gripped by funding winter in 2023, investors continued to flock to invest in Walmart-owned fintech startup PhonePe.

This was evident by the fact that the finch decacorn secured a mammoth $850 Mn (INR 7,021 Cr) in funding during the year, at a valuation of $12 Bn.

In what was touted as the largest equity fundraise by an Indian startup, the cash infusion saw participation from big names including Walmart, Ribbit Capital, Tiger Global, TVS Capital Funds, and General Atlantic, among others.

Of its stated intention to raise $1 Bn in 2023, PhonePe achieved 85% of its target while many other unicorn peers were mired in valuation markdowns and paucity of funds.

The move to raise big-ticket funding rounds was likely attributed to the INR 8,000 Cr tax liability on account of shifting headquarters to India and to fuel its growth ambitions ahead of the planned IPO.

Since securing the capital, the company has undertaken a blitzscaling approach – introducing a slew of new products and foraying into new categories such as income tax payment and health insurance.

PhonePe also plans to introduce a range of consumer credit products in the coming six to seven months to bolster its lending play.

Founded in December 2015 by Sameer Nigam, Rahul Chari, and Burzin Engineer, PhonePe is a digital payments and financial services company. It claims to have more than 400 Mn registered users that use its products across the country.

The Bengaluru-based startup recorded a revenue of INR 2,914 Cr in the financial year 2022-23 (FY23), up almost 77% from INR 1,646 Cr in FY22. The startup didn’t disclose its net loss for the financial year ending March 2023.

The fintech platform competes against the likes of Paytm, Google Pay, and CRED in UPI transactions.

Lenskart Fancied A Solid At $600 Mn In 2023 

Eyewear unicorn Lenskart successfully secured $600 Mn in 2023, with a significant portion of $500 Mn coming from the Abu Dhabi Investment Authority (ADIA) and an additional $100 Mn from private equity player ChrysCapital. The investments propelled Lenskart’s total capital infusion to nearly $850 Mn.

According to Inc42, Lenskart raised $879.6 Mn in funding between 2014 and November 2022. The Faridabad-based eyewear brand has raised more than $205 Mn since the beginning of 2022 alone.

Established in 2010, Lenskart stands as India’s largest omnichannel eyewear retailer, extending its reach to Singapore, the UAE, and other geographies. The company currently boasts a customer base of 20 Mn in India.

Lenskart is aggressively expanding internationally, particularly across Asia and the Middle East. In June last year, the ecommerce platform made headlines by acquiring Japan’s largest online eyewear brand, OWNDAYS, in a deal valued at $400 Mn.

With over 2,000 stores, including 1,500 in India and the remaining spread across various geographies, Lenskart is positioned for further growth.

Earlier this month, the eyewear brand announced that it was set to strengthen its presence in Southeast Asia (SEA) by launching 300-400 stores in the region over the next two years.

With approximately 70 stores currently operational in Singapore, the Delhi NCR-based unicorn plans to extend its footprint to Thailand and the Philippines.

The company’s FY23 profit stood at INR 260 Cr against a loss of INR 100 Cr in FY22, the company’s founder and CEO Peyush Bansal told ET in an interview. The startup also reportedly more than doubled its revenue to INR 3,780 Cr.

Lenskart has also ventured into the creation of a Thrasio-styled eyewear-focussed ecommerce roll-up brand, Neso Brands. To further broaden its customer base, the company is actively engaged in vertical integration through a new manufacturing facility, enabling the brand to maintain competitive pricing.

DMI Finance Lapped Up $447 Mn From Multiple Investors 

In April this year, Mumbai-based DMI Finance secured $400 Mn in a funding round led by Mitsubishi UFJ Financial Group. Investor Sumitomo Mitsui Trust Bank (SuMi TRUST Bank), too, participated in the funding round, which included both primary and secondary transactions.

In January last year, the NBFC arm of the DMI Group raised $47 Mn in an equity round from Sumitomo Mitsui Trust Bank and existing investors NXC Corporation and New Investment Solutions.

With this year’s funding round, the total funding raised by the non-banking financial company (NBFC) has reached $900 Mn.

Founded in 2008 by Shivashish Chatterjee and Yuvraja C Singh, DMI Finance is a pure-play digital lender. It extends credit lines in the form of personal and MSME loans. DMI Finance sources and services customers through digital channels. It is an embedded digital finance partner for the likes of Samsung, Google Pay and Airtel.

Ola Electric’s $384 Mn Funding Buffet

In October this year, Bhavish Aggarwal-led Ola Electric secured INR 3,200 Cr ($384 Mn) in a combination of equity and debt to fuel the expansion of its EV business and establish India’s first lithium-ion cell manufacturing facility in Krishnagiri, Tamil Nadu.

Temasek spearheaded the equity portion, while the State Bank of India led the debt segment of the funding.

The company lapped up funds at a time when it was alleged of violating FAME-II subsidies norms. Besides, allegations of sub-par quality of its scooters and concerns with after-sales service have continued to shroud the EV maker for long.

Despite this, investors see a lot of potential in Ola Electric, which now plans to file its IPO papers before December 20. The startup plans to raise $700 Mn and is looking to target a market capitalisation of $10 Bn through its IPO.

Founded on May 26, 2017, under the leadership of Bhavish Aggarwal, Ola Electric is a subsidiary of Ola and operates as an Indian electric two-wheeler manufacturer. The company is headquartered in Bengaluru, Karnataka.

In October, electric two-wheeler registrations in India surpassed 70,000 units after four months. Despite facing controversies, Ola Electric’s escooter registrations continued to lead the market.

In the meantime, the startup expanded its product line, launching the Ola S1X escooter model in August shortly after delivering the Ola S1 Air model to customers.

Ola Electric’s net loss almost doubled to INR 1,472 Cr in FY23 from INR 784.1 Cr in FY22 due to a steep rise in expenses.

Its consolidated revenue during the fiscal surged 510% YoY to reach INR 2,782 Cr in FY23. The EV startup aims to garner revenue of INR 4,655 Cr in FY24.

Builder.ai Received A $250 Mn Qatar Investment Authority Boost

London-based AI startup Builder.ai raised $250 Mn in a Series D funding round led by Qatar Investment Authority (QIA). Other investors who backed the startup included Iconiq Capital, Jungle Ventures, and Insight Partners.

In a statement, the Microsoft-backed startup revealed that the funding round resulted in a valuation increase of over 1.8X.

Builder.ai had raised the funds for hiring new talent, fostering partnerships, and advancing its technology.

The company claims to have doubled its headcount since January 2022 and expanded its global presence with the opening of four new offices in the US, the UAE, Singapore and France.

With its last funding round, Builder.ai’s total funding now stands at over $450 Mn.

Founded in 2016 by Sachin Dev Duggal and Saurabh Dhoot in Gurugram, Builder.ai offers a platform for entrepreneurs to build apps without little to no coding knowledge using AI.

InsuranceDekho Lapped Up $210 Mn To Disrupt Insurtech Sector

Insurtech startup InsuranceDekho raised $210 Mn across two funding rounds in 2023 to expand its presence across the country.

In February, the startup raised $150 Mn in a Series A funding round, which was a mix of equity and debt. The equity round was led by Goldman Sachs Asset Management and TVS Capital Funds, and also saw participation from Investcorp, Avataar Ventures and LeapFrog Investments

Almost seven months after this, InsuranceDekho secured $60 Mn in a mix of equity and debt in its Series B round. It saw participation from Mitsubishi UFJ Financial Group, Inc, BNP Paribas Cardif, Beams Fintech Fund and Yogesh Mahansaria Family Office. Existing investors TVS Capital, Goldman Sachs Asset Management, and Avataar Ventures also participated in the round, which valued the startup at around $650 Mn-$700 Mn.

The insurtech soonicorn said it planned to utilise the capital to enhance marketing efforts, expand distribution in rural India, scale up its tech platform, and explore inorganic growth opportunities.

Founded by Ankit Agrawal and Ish Babbar in 2017 as the insurance arm of online car marketplace CarDekho, InsuranceDekho received $20 Mn from its parent firm Girnar Software in 2020. Later, it was hived off to function as a separate unit. The platform allows users to compare and buy insurance from top companies. The insurtech platform offers motor, life, health, pet, and travel insurance.

The startup reported a 29% decline in its net loss to INR 51.5 Cr in FY23 from INR 72.2 Cr in the previous fiscal year. Operating revenue doubled to INR 96.4 Cr from INR 47.9 Cr in FY22.

Perfios Inked $229 Mn Funding Deal With Kedaara Capital

In September, Bengaluru-based fintech SaaS startup Perfios signed an agreement with Kedaara Capital for an investment of $229 Mn in the startup’s Series D funding round through the combination of a primary and a secondary sale.

The investment had come almost 19 months after Perfios raised $70 Mn at a valuation of $400 Mn.

The funds were intended to fuel its global expansion plans, particularly into North America and Europe. Additionally, the startup had planned to invest in technology to enhance its comprehensive suite of decision analytics SaaS products.

Founded in 2008 by VR Govindarajan and Debasish Chakraborty, Perfios is a credit decisioning and analytics startup, which operates in B2B and B2C segments. Currently operating in 18 countries, it claims to be working with over 1,000 financial institutions.

According to the company, it delivers 8.2 Bn data points to banks and financial institutions every year to facilitate faster decisioning and processes 1.7 Bn transactions a year with an AUM of $36 Bn.

Fintech SaaS startup Perfios turned profitable in FY23, posting a consolidated net profit of INR 7.8 Cr on the back of a significant jump in its service income from India business.

The startup reported a net loss of INR 16.8 Cr in FY22 on an operating revenue of INR 136.5 Cr.

Zepto Turned Unicorn With $200 Mn Funding Round

Mumbai-based quick commerce unicorn Zepto successfully raised $200 Mn in its Series E funding round in August at a valuation of $1.4 Bn, becoming the first and only unicorn of 2023. Without disclosing how it planned to use the fresh capital, the startup said it plans to go public by 2025.

Later in November, Zepto raised an additional $31.25 Mn as part of the Series E funding round from Goodwater Capital and Nexus Venture Partners, along with the participation of angel investors such as Oliver and Lish Jung, and Mangum II LLC.

Founded in 2021 by Aadit Palicha and Kaivalya Vohora, Zepto seized the opportunity created by the increased demand for rapid ecommerce delivery during the Covid-19 pandemic. The startup gained attention when it secured $60 Mn in funding in November 2021 from investors like Glade Brook Capital, Nexus, and Y Combinator.

Zepto competes against the likes of Swiggy’s Instamart, Zomato-owned Blinkit, and Reliance-backed Dunzo.

Zepto’s net loss surged 3.35X to INR 1,272.4 Cr in FY23 from INR 390.3 Cr in the previous financial year. Revenue from operations zoomed 14.3X to INR 2,024.3 Cr during the year under review from INR 140.7 Cr in FY22.

B2B Manufacturing Unicorn Zetwerk Secured $120 Mn In Series F

In October, B2B ecommerce unicorn Zetwerk raised $120 Mn in its Series F funding round, which was led by Avenir Growth Capital and saw participation from existing investors Lightspeed, Greenoaks Capital, and Steadview Capital.

Additionally, the B2B unicorn secured INR 100 Cr (around $12 Mn) in debt funding in March this year.

Notably, Zetwerk raised $210 Mn at a valuation of $2.7 Bn in a round led by Greenoaks in December 2021.

Founded in 2018 by Amrit Acharya, Srinath Ramakkrushnan, Rahul Sharma and Vishal Chaudhary, Zetwerk connects manufacturing companies with vendors and suppliers for customised products, industrial machine components and other equipment.

Zetwerk has raised nearly $674 Mn in funding since its inception. The B2B unicorn competes with the likes of Infra.Market, Moglix and OfBusiness.

While the unicorn has yet to file its financials for FY23, it posted a loss of INR 59.7 Cr in FY22, up 45% from INR 41.1 Cr in FY21.

Last year, Zetwerk went on an acquisition spree, picking up four companies between July and November 2022 for a total of $50 Mn.

Mintifi Raised $110 Mn To Give Indian SMEs A Lending Push 

In March, the B2B digital lending startup, Mintifi, announced that it raised $110 Mn (INR 902 Cr) in a Series D funding round led by Premji Invest.

The startup’s existing investors, Norwest Venture Partners, Elevation Capital, and International Finance Corporation (IFC), too, participated in the round.

Mintifi had raised the funds to deepen its presence in the supply chain financing domain and expand its product range. The startup also intended to deploy investments towards scaling up the B2B payments vertical and dealer management system.

A part of the funds was put aside to strengthen the tech stack and enhance engagement. The investment also enabled Mintifi to expand its capital base for credit purposes to more than $600 Mn.

The post Big Money Moves: Here’s The List Of India’s 10 Highest Funded Startups Of 2023 appeared first on Inc42 Media.

The years 2020 and 2021 were among the most historical ones for the Indian startup ecosystem. Amid the Covid-19 pandemic wreaking havoc across the globe, Indian startups made a name for themselves on the back of their innovations. This resulted in global investors making a beeline to pump in capital in the country’s startup ecosystem.

Such was the gold rush to India that the startups in the country raked up a record $42 Bn funding. Every investor of note seemed to be wanting a piece of India’s digital ecosystem. The fear of missing out took over and the bottom lines of the startups in which capital was being infused took a back seat. 

To put things into perspective, as many as 55 out of 74 Indian unicorns incurred a cumulative operating loss of $5.9 Bn in FY22, as per an Inc42 analysis. This was almost double the cumulative loss of $3 Bn incurred by 53 of these startups in FY21. However, this didn’t deter investors from participating in the funding rounds of these startups.

At the time, it seemed as if nothing could go wrong for the Indian startup ecosystem. Then, came the funding winter. Amid the global economic slowdown and tight liquidity, investors suddenly started focussing back on profitability and the growth-at-all-costs approach was thrown out of the window.

This came as a rude shock to Indian startups, which had got accustomed to the free-flowing funding scenario of the previous years. As investors tightened their purse strings, realisation struck that they needed to focus on their bottom lines to extend their runways and get fresh funding. This resulted in the start of restructuring exercises across startups.

Layoffs, pay cuts, and cuts in advertising expenses became the norm as turning profitable and cutting down loss became the top priority. As per Inc42’s layoff tracker, Indian startups have laid off over 29,000 employees so far. 

But did it help Indian startups turn profitable? While a majority of Indian startups are still in the red, a few of them managed to turn profitable in FY23. Besides, many of them also managed to cut down on their losses. 

As 2023 nears its end, we have collated a list of startups that managed to turn around their business and became profitable in FY23.

Editor’s Note: This compilation is neither exhaustive nor a ranking of any kind. Startups are listed alphabetically.

Decline In ESOP Expenses Steers CarTrade To The Profitability Lane

Listed auto marketplace CarTrade turned profitable in FY23. It reported a net profit of INR 40.43 Cr in FY23 as against a net loss of INR 121.35 Cr in the previous fiscal year.

The sharp improvement could be attributed to the decline in its ESOP expenses, or non-cash share-based payment expenses. ESOP expenses plummeted to INR 27.94 Cr during the year under review from INR 185.18 Cr in FY22. This resulted in a drop in the startup’s overall expenses to 23.2% to INR 367.16 Cr in FY23 from INR 478.07 Cr.

On the other hand, the startup’s revenue from operations rose by 16% to INR 363.74 Cr during the year from INR 312.72 Cr.

Meanwhile, the startup has continued its profitable ride in FY24 as well. In Q2 FY24, it reported a 132% year-on-year (YoY) increase in consolidated profit to INR 12.96 Cr. 

Exceptional Gain Catapults Fractal Into The Profitable Club

AI Intelligence startup Fractal, which took almost two decades to enter the unicorn club, reported a profit of INR 194.4 Cr in FY23 as against a loss of INR 148.4 Cr in the previous financial year.

However, the startup would still have posted a loss if not for an exceptional item gain of INR xxx Cr from the loss of control of a subsidiary company. An email sent to Fractal seeking information about this exceptional item gain didn’t elicit any response till the time of publishing this story.

Meanwhile, Fractal’s operating revenue zoomed 53% to INR 1,985.4 Cr in FY23 from INR 1,295.3 Cr in the previous year, with majority of the revenue coming from the US. 

Founded in 2000 by Srikanth Velamakanni and Pranay Agrawal, along with core team members – Nirmal Palaparthi, Pradeep Suryanarayan, and Ramakrishna Reddy, Fractal offers AI and advanced analytics solutions to Fortune 500 companies.

The startup has raised a funding of around $680 Mn to date and counts TPG, Apax Partners, and Khazanah Nasional among its investors. 

Groww’s Growing User Base Helps It Become Profitable

Billionbrains Garage Private Limited, the parent entity of Groww, turned profitable in FY23. It reported a net profit of INR 448.7 Cr in FY23 as against a loss of INR 239 Cr in the previous fiscal year.

The primary reason for the startup turning profitable was strong growth in its operating revenue, which rose over three-fold to INR 1,277.8 in FY23 from INR 351 Cr in the previous fiscal year. Meanwhile, total expenses rose a meagre 1.4X to INR 932.9 Cr.

The increase in operating revenue could be attributed to the startup’s growing user base. Groww surpassed bootstrapped unicorn Zerodha in terms of number of active investors at the end of September 2023. 

As per National Stock Exchange (NSE) data, Groww had 6.63 Mn active investors at the end of September 2023 as against Zerodha’s 6.48 Mn.

Besides its stock broking platform, Groww has also started offering loans. Earlier this year, it rolled out UPI payments feature on its broking app and acquired the mutual fund business of Indiabulls Housing Finance for a consideration of INR 175.6 Cr.

Increase In MSME Lending Helps Indifi Post Profit

ICICI Venture-backed Indifi reported a profit of INR 5.1 Cr in FY23 as compared to a loss of INR 39 Cr in the previous fiscal year.

The improvement in the startup’s financials could be attributed to the 2X jump in its operating revenue. The MSME lender reported an operating revenue of INR 197.9 Cr in FY23 as against INR 96.29 Cr in the previous fiscal year.

As per Aloke Mittal, the founder of Indifi, the startup saw a sharp improvement in business during the pandemic due to higher demand from MSMEs for working capital. Amid the stay-at-home restriction, MSMEs relied more on digital lenders for their hassle-free and digital offerings than banks, which often require tedious paperwork and visits to the branch.

Lower Expenses Help NeoGrowth Report Profit

Mumbai-based non-banking financial company (NBFC) NeoGrowth turned profitable in FY23 on the back of decline in its expenses. The startup reported a profit of INR 17.2 Cr in FY23 against a loss of INR 39.4 Cr incurred in FY22.

Neogrowth’s operating revenue rose 5.3% to INR 381 Cr during the year under review from INR 361.5 Cr in FY22. At INR 363.1 Cr, the NBFC earned the biggest chunk of revenue from interest income in FY23. This number stood at INR 357.5 Cr in the previous year. 

Besides interest income, NeoGrowth also earned revenue from commissions and fees. Total revenue rose to INR 382.9 Cr in FY23 from INR 362.7 Cr in FY22. 

Meanwhile, total expenses declined 14% to INR 357.4 Cr in FY23 from INR 414.5 Cr in FY22. 

The NBFC raised $66 Mn in a mix of debt and equity funding across multiple rounds in FY23. Overall, it has raised around $188 Mn to date and counts Dutch development bank FMO, Development Finance Corporation (DFC), Omidyar Network, and Lightrock among its backers.

 
Perfios Turns It Around In FY23

Fintech-focussed SaaS startup Perfios achieved profitability in the fiscal year ending on March 31, 2023, marking a significant milestone after four consecutive years of losses. 

The Bengaluru-based company reported a profit of INR 7.8 Cr after incurring a net loss of INR 16.8 Cr in FY22.

In FY23, Perfios’ operating revenue surged nearly 200% YoY to INR 406.8 Cr compared to the INR 136.5 Cr reported in the preceding fiscal. 

The company generates revenue by providing software solutions to financial institutions, covering areas such as analytics, onboarding automation, and due diligence.

Earlier this year, Perfios secured $229 Mn in its Series D funding round from Kedaara Capital.

Looking ahead, Perfios is gearing up for a public market listing within the next 18-24 months. For this, the company has appointed Sumit Nigam as the Chief Technology Officer (CTO) and Anu Mathew as the Chief People Officer (CPO).

Tracxn Takes The Profitability Route

Listed data intelligence platform Tracxn turned profitable in FY23 with a PAT of INR 33.09 Cr against a loss of INR 4.85 Cr a fiscal ago.

During the year under review, Tracxn recorded a deferred tax expense of INR 23.26 Cr. Additionally, in the December 2022 quarter, the company recovered INR 4.78 Cr, previously recognised as an IPO expense, from shareholders who sold their shares during the public offering.

Excluding the aforementioned recovery of IPO expenses and the deferred tax expense, the startup’s profit stood at INR 5.34 Cr in FY23 versus a loss of INR 36 Lakh in FY22.

The startup’s operating revenue rose 23% to INR 78.11 Cr in FY23 from INR 63.45 Cr in FY22 on the back of continued growth in large accounts and increased uptake of products globally, especially in India, the Americas, and Asia Pacific. It must be noted that around 70% of the startup’s revenue comes from outside India.

In the first quarter of FY24, the startup’s profit declined 18% to INR 69 Lakh from INR 1.36 Cr reported in the same quarter last fiscal year. Revenue from operations increased to INR 19.82 Cr, up 8% YoY.

The post Balancing The Books: Here’re The Indian Startups Which Turned Profitable In FY23 appeared first on Inc42 Media.

As we approach the end of 2023, it can be safely said that India’s startup ecosystem has had a year to forget. As funding slowed to a drip, dozens of startups have bitten the dust since the start of the year, as startup layoffs continue to disrupt livelihoods across the country.

According to Inc42’s Indian Tech Startup Funding Report Q3 2023, Indian startups have raised $7.1 Bn in the first nine months of 2023, down 68% compared to approximately $22 Bn raised during the corresponding period last year.

While the current scheme of things has prompted many marquee investors to instruct their portfolio startups to cut costs and increase runways, many founders seem to have caused a bloodbath in the job market in the name of undertaking cost-cutting measures.

Since the onset of the funding winter in 2022, an estimated 34,785 employees have been laid off by 121 Indian startups.

Further, edtech has seen the most layoffs, followed by consumer services and ecommerce. The three sectors have collectively seen 57 startups laying off 25,909 employees since last year.

The edtech segment, in particular, has come under intense scrutiny. Since last year, 24 Indian edtech startups, including six of the seven edtech unicorns, have fired 14,616 employees.

Further, as many as 15,247 employees have been fired by 69 startups so far this year, highlighting the fact that the situation around job cuts has hardly improved.

As the startup ecosystem continues to endure a funding winter and the subsequent slowdown, Inc42 has compiled a list of startup layoffs that have happened so far.

If you would like to report a layoff, pay cut etc. at a startup, write to us at editor@inc42.com.

Indian Startup Layoffs

December 6 | ZestMoney To Shut Down By December-End, Fires 150 Employees

Fintech startup ZestMoney is about to shut down as the efforts of the new management to revive the company failed to materialise. The fintech startup will wrap up operations by the end of December and lay off its entire workforce of 150 employees.

The development has come after the company failed to raise a follow-on round or find a buyer to save its sinking ship. Meanwhile, the company has promised two months of severance payments and outplacement support to the outgoing employees.

The shutdown comes after the company’s original cofounders, Lizzie Chapman, Priya Sharma, and Ashish Anantharaman, quit the startup in May this year. The leadership team resigned after the acquisition talks with the fintech major PhonePe went awry. At the time, the company had to trim 30% of its workforce.

November 30 | Krafton-Backed Loco Fires 36% Workforce Amid GST Woes

Game streaming platform Loco laid off 40 employees, or around 36% of its workforce, as part of the company’s realignment process. 

Loco’s founders Anirudh Pandita and Ashwin Suresh announced the layoffs during a recent town hall, stating it was part of the company’s restructuring plan, even as they aimed to expand operations globally.

Suresh told Inc42 that after a recent strategic review, they decided to focus on transaction-based monetisation and operate with a leaner cost structure. Moving ahead, Loco will concentrate exclusively on core objectives, including monetisation.

Last year, Loco raised $42 Mn (INR 330 Cr) in its Series A funding round led by South Korea’s early-stage venture fund Hashed. The startup also counts Krafton and Lumikai as its other investors.

November 20 | Inc42 Exclusive: Jodo Sacks 100 Employees As Business Outlook Falters

Jodo laid off around 100 employees in a cost-cutting exercise on the back of lower-than-expected business growth, multiple sources told Inc42.

The layoffs took place across departments, including engineering, data, customer success, product management, and sales. New employees, as well as those drawing high salaries, were impacted by the retrenchment exercise.

The educational fee management startup held a virtual town hall meeting on November 17, during which its founders informed the employees that Jodo would need to cut down its costs to sustain itself over the coming months. The founders also said that the startup failed to achieve the business targets for this year, the sources said.

An email sent to the founders of Jodo regarding the layoffs didn’t elicit any response.

November 19 | PhysicsWallah Lays Off Around 120 Employees

Edtech unicorn PhysicsWallah (PW) laid off around 70-120 employees, less than 1% of its workforce. While reports suggest that the move was part of a cost-cutting exercise, the company claimed that these layoffs were due to performance issues.

“At PW, we regularly assess performance through mid-term and end-term cycles. For the cycle ending in October, less than 0.8% of our workforce, ranging from 70 to 120 individuals with performance concerns, may be asked to transition. Our primary focus remains on fostering a dynamic, high-performing team,” the CHRO of PW, Satish Khengre, said.

Khengre added that the edtech unicorn plans to hire an additional 1,000 employees in the next six months. “We deeply value the dedication of our existing employees and recognise their integral role in shaping the future of education technology,” he added.

October 26 | Inc42 Exclusive: Unacademy’s Graphy Cuts 20-30% Jobs

Unacademy-owned SaaS platform Graphy culled 20-30% of its workforce, or nearly 50 employees, multiple sources privy to the development told Inc42. 

Graphy, which offers learning management system services to creators in the edtech space, has been struggling to hit the revenue target, leading to a restructuring within the firm, Inc42 learned from sources.

In a statement sent to Inc42, an Unacademy representative stated that the job cuts happened on the basis of performance and had nothing to do with layoffs or revenue growth plans.

“We have not done any layoffs, and we remain focussed on enhancing our team’s performance and overall productivity so we can continue to compound our growth,” a Graphy spokesperson said.

October 16 | Inc42 Exclusive: CityMall Fires Another 90 Employees

Nearly 16 months after undergoing its first retrenchment round, social commerce unicorn CityMall conducted its second round of layoffs on October 16, terminating around 90 employees, sources privy to the development told Inc42. 

The layoffs impacted nearly all departments within the company. CityMall provided a month’s salary as severance pay. As per sources, the layoffs happened as a result of a cost-cutting exercise and on investors’ directives.

Inc42 also found out that while the startup had been conducting layoffs in smaller groups since June this year, the October 15 layoff round was the most significant since last year.

October 12 | Adda247 Joins The Edtech Layoff Spree, Fires 250-300 Employees To Extend Runway

Google-backed Adda247 fired around 250-300 employees across multiple verticals as it looked to extend its runway amid the ongoing funding winter. 

According to Entrackr, Adda247 also laid off 100-150 employees at its UPSC-focussed test prep vertical, StudyIQ. The edtech startup fired another 150 employees from sales, content, and faculty teams. 

Inc42’s email to the startup did not elicit a response.

As per the report, the layoffs were undertaken because the edtech player doesn’t expect the investment environment for the sector to improve. The employees were told to resign without any prior notice. 

October 5 | Bizongo Lays Off 50 Employees A Day After Announcing $50 Mn Funding Round

Just a day after raising $50 Mn, B2B vendor management platform Bizongo fired nearly 50 employees. The layoffs could likely be attributed to the company’s growing focus on profitability. 

In a statement to Inc42, Bizongo said the move is part of its focus on driving key business goals.

“We are driving sharper focus towards key business goals, and in lieu of this, we have reallocated our people. Parting ways with people is never easy, and these are difficult decisions. We are fully committed to extending support to affected employees to the best of our abilities,” a Bizongo spokesperson said.

September 26 | Embattled Edtech BYJU’S Announces 4,000 Job Cuts

BYJU’S announced to lay off around 4,000 employees as part of a restructuring exercise amid a severe cash crunch, sources told Inc42. The layoffs were to be restricted to Think & Learn Private Ltd, the parent of BYJU’S, sources said.

“…indications of such layoffs have been given to the employees. This is the only way to move forward,” one of the sources said. The layoff exercise will also impact senior employees and team managers. 

A BYJU’S spokesperson confirmed that the edtech company will be undertaking a restructuring exercise but did not disclose the number of employees who will be impacted by it. 

September 21 | DealShare Shuts B2B Biz, Fires Another 100 Employees

DealShare discontinued its B2B business and fired over 100 employees as part of this process, sources told Inc42. The unicorn confirmed the development to Inc42. DealShare said it is moving its operations to Gurugram and consolidating its business to focus on the Jaipur, Delhi NCR, Lucknow, and Kolkata markets.

“We also took a conscious decision to focus on B2C business at this point to stay relevant to our consumers in the market. We have taken decisions about realigning our budgets, reorganising teams and locations, etc.,” a company spokesperson said in a statement. 

The development came almost two months after DealShare cofounder and CEO Vineet Rao stepped down from his role. 

September 11 | Chargebee Fires 10% Workforce In 2nd Round Of Layoffs

Chennai-based SaaS unicorn Chargebee laid off 10% of its workforce, affecting 100 to 120 employees across multiple departments.

Chargebee CEO Krish Subramanian cited ‘market shifts’ as the primary reason behind the layoffs. The company said that it would provide severance packages in accordance with the relevant labour laws in each country.

The latest layoffs come almost ten months after the company sacked approximately 142 employees due to volatile economic conditions.

September 1 | Khatabook Fires Over 40 Employees

Peak XV Partners-backed fintech startup Khatabook sacked more than 40 employees to cut costs and turn profitable. The impacted employees were from sales, marketing, analytics, and tech teams.

The startup offered a three-month salary as a severance package to the impacted employees, including pay, stock option vesting, health insurance extensions, and other job search-related support, the startup told Inc42.

Khatabook has raised $187 Mn to date, including $100 Mn from Tribe Capital and Moore Strategic Ventures in its Series C round. It counts B Capital, Peak XV Partners, and Better Capital among its investors.

August 30 | Inc42 Exclusive: Shiprocket-Owned Omuni Fires 35% Workforce

Shiprocket-owned retail SaaS platform Omuni laid off around 60-70 employees, or nearly 35% of its workforce, sources told Inc42. 

The retrenchment exercise, which took place in the second week of August, impacted employees from the tech, product, sales, and talent acquisition teams.

Omuni is giving a salary of two months as severance pay to the outgoing employees.

Besides, Inc42 learned that Omuni CEO and cofounder Mukul Bafna and CTO Sumeet Chandhok were also planning to step down.

August 29 | CoinSwitch Fires 44 Employees Amid Regulatory Hiccups

Tiger Global-backed crypto exchange CoinsSwitch laid off 44 employees as part of a restructuring exercise. The layoffs predominantly impacted the customer support team.

As per the company, the layoffs took place earlier this month, with impacted employees ‘voluntarily resigning’ from their positions. The unicorn did not share any details of the severance packages the outgoing employees would be eligible for.

The job cuts come at a time when the entire crypto ecosystem has been reeling under the impact of a hefty taxation regime. Be it a 30% tax on gains from the sale of virtual digital assets (VDAs) or a 1% tax deducted at source (TDS) for all crypto transactions worth INR 10,000 and above, the crypto industry has been mired in regulatory uncertainty.

August 29 | Kenko Health Fires Over 20% Of Employees

Bengaluru-based healthcare financing startup Kenko Health trimmed at least 20% of its workforce (around 80 employees). The layoffs impacted employees from support, processing, sales, and tech teams in the Delhi NCR and Bengaluru offices, sources told Inc42. The move to cut jobs has been attributed to the ongoing funding crunch and Kenko’s failure to generate consistent revenues.

There are no details of any severance package being offered to the impacted employee.

The recent round of layoffs comes more than a year after the startup raised $12 Mn in its Series A funding round led by Peak XV Partners, with participation from BEENEXT, Orios, 9Unicorns and Waveform.

August 26 | Cuemath Fires Another 100 Employees To Cut Costs

Peak XV-backed edtech startup Cuemath fired another 100 employees to cut costs. 

“Unfortunately, our revenue and cost trajectories are still divergent from expectations, and our problems are compounded by the bad macro situation around capital availability, particularly for edtech,” Cuemath founder and CEO Manan Khurma told the employees in an email on Friday (August 25), as per a Moneycontrol report.

Inc42’s email to Cuemath did not elicit a response.

The development comes three months after the Bengaluru-based edtech startup fired around 100 employees in May this year, within a year of raising $57 Mn. After the May layoffs, Khurma reportedly told the Cuemath employees that there wouldn’t be any need for more layoffs. 

August 24 | Chingari Sacks Over 50% Employees In Second Round Of Layoffs

Cash-strapped short-video platform Chingari laid off more than 50% of its workforce in a second round of layoffs within two months, sources told Inc42. The layoffs impacted employees from teams like product, customer support, design, and marketing. 

Following the latest round of layoffs, Chingari is now left with only 50-60 employees, as per sources. Besides layoffs, Chingari has also asked some of its employees to take pay cuts of up to 50%. 

August 19 | Gaming Startup Spartan Poker Fires 40% Workforce Amid GST Pressure

Spartan Poker fired 125 employees or 40% of its total workforce, as it grapples with the new 28% tax regime. It was not immediately clear, which departments were impacted by the company’s retrenchment move. 

There is no clarity if the company offered any severance package to the impacted employees. 

Founded by Amin Rozani, Sameer Rattonsey and Peter Abraham in 2014, Spartan Poker is an online poker platform that allows gaming enthusiasts to play poker tournaments online across various formats.

August 10 | Hike Fires 22% Employees Amid GST Pressure

Web3 gaming startup Hike, which pivoted from instant messaging, fired 22% of its workforce, about 55 people, following the GST Council’s decision to charge a 28% GST on online gaming.

People familiar with the development told Inc42 that the retrenchments came as the gaming company was staring at a 400% increase in tax burden. While sources said as many as 100 employees were impacted, Hike’s founder and CEO Kavin Mittal told Inc42 that nearly 55 people have been laid off by the company.

“…Business is in the best shape ever but this 400% increase in GST is a bazooka pointed at us. We’ll need to absorb some of it and as a result, the RIF [reduction in force] at Hike/Rush,” Mittal said.

Meanwhile, there was no information available on the teams impacted and any severance benefits the outgoing employees were entitled to.

August 8 | MPL Fires 350 Employees Following The 28% GST Regime

Gaming unicorn Mobile Premier League (MPL) decided to slash 350 jobs to cut costs following the GST Council’s decision to levy a 28% tax on online gaming. The move comes more than a year after the startup fired 100 employees in May 2022.

In an internal mail, MPL cofounder and CEO Sai Srinivas said that the startup would lay off about 350 employees. Placing the blame squarely on the levy of 28% GST on full face value for real-money gaming, Srinivas told employees that the new levy has increased the tax burden on the company by as much as 350-400%.

Srinivas also told employees that the company spent a ‘lot of time evaluating and re-evaluating’ the layoffs. He added that the unicorn eventually decided that ‘the sooner we are able to deliver certainty to everyone, the better’.

However, no details were available on the teams affected and any severance benefits the outgoing employees were entitled to.

August 3 | Spinny Lays Off 300 Employees Post Merger

Spinny downsized around 4.5% of its total workforce, approximately 300 employees, out of a total of 6,500 after the merger of Truebil and Spinny Max with its main Spinny platform.

“This business reorganisation will strengthen our go-to-market business model, reduce costs and improve our margin profile, putting us on an expedited path to profitability. However, it will impact approximately 4.5% of our total workforce as we consolidate our operations under a single brand,” the company told Inc42.

The used cars marketplace did not share any information regarding the teams impacted by the layoffs, or whether the impacted employees were entitled to any severance benefits following the retrenchments.

August 2 | SaaS Startup Actyv.ai Fires 60 Employees

SaaS startup Actyv.ai fired 60 employees or around 50% of its 120-strong workforce, impacting employees from the product, marketing, HR, sales and solutions teams at Actyv.ai, sources told Inc42.

Actvy.ai fired the employees during a town hall meeting on July 31, the sources said, adding that the startup offered one month’s salary as severance pay to the impacted employees.

Raghu Subramanian, founder and global CEO of the startup, said, “We value the dedication and commitment of each team member during this transition period, and we believe that these measures will position us for a stronger and more resilient future.”

The development comes months after the SaaS startup announced the close of a $12 Mn (INR 96 Cr) Pre-Series A funding round from Singapore-based 1Digi Ventures and Subramanian’s family office in January 2023.

August 1 | Inc42 Exclusive: Increff Lays Off 20% Workforce To Cut Costs

Premji Invest-backed SaaS startup Increff laid off around 60 employees or 20% of its workforce in a cost-cutting exercise. The employees were from the tech, sales, customer success, and HR teams, among others.

Responding to Inc42’s queries on the development, Increff CEO and cofounder Rajul Jain confirmed the layoffs. Per Inc42 sources, adverse macroeconomic conditions and failure to meet the targets for onboarding new clients led to the layoffs. There was no information made available by the startup regarding any severance benefits.

Last year, it raised $12 Mn in a Series B round, which saw participation from Premji Invest, Binny Bansal’s 021 Capital, among others. Earlier, in 2017, it raised around $2 Mn from Sequoia Capital (now Peak XV Partners).

July 14 | Skill-Lync Fires 225 Employees In Another Round Of Layoffs

Skill-Lync conducted a second round of layoffs which impacted nearly 20% of its workforce or around 225 employees. There was no clarity on which specific teams and positions were impacted as part of the mass firings.

“This decision was not taken lightly, and we have done our utmost to ensure that the process was as transparent and fair as possible for the employees involved,” said Skill-Lync cofounder Suryanarayanan Paneerselvam in a statement to Techcrunch. 

In April this year, the Chennai-headquartered startup slashed more than 400 jobs, blaming macroeconomic conditions.

July 13 | Sachin Bansal-Led Fintech Navi Fires 200 Employees

IPO-bound fintech startup Navi Technologies reportedly has fired around 200 employees across multiple departments. Per media reports, product development and management teams have seen up to 70% of members impacted by the layoffs at Navi.

A spokesperson for the fintech unicorn attributed the layoffs to a routine performance appraisal. “Navi conducts performance appraisals twice a year, which results in expected departures from the company,” said the spokesperson. Navi did not respond to Inc42’s query related to any severance to which the impacted employees would be entitled.

The move comes days after Navi’s NBFC arm, Navi Finserv, started raising up to INR 500 Cr through the public issue of Non-Convertible Debentures (NCDs). The debt raise opened on July 10, and the subscriptions will close on July 21.

July 12 | WayCool Fires 300 Employees To Chase Profitability

Agritech startup WayCool fired 300 employees in a restructuring exercise to chase profitability. The agritech startup will also shut down some of its distribution centres and a few new experimental projects.

“We plan to focus on our core and profitable businesses, slowing down on some of our experimental initiatives as we work to grow further. This will change the profile of our business but is aimed at ensuring a sustainable and long-term success of our enterprise,” a WayCool spokesperson told Inc42.

The layoffs come nearly 18 months after WayCool raised $117 Mn in January 2022 in the largest-ever agritech funding round.

June 19 | Inc42 Exclusive: Chingari Lays Off 20% Workforce, Pivots Content Model

Short-video app Chingari fired 20% of its workforce weeks after Chingari cofounder Aditya Kothari quit the startup. While employees across teams lost their jobs, the tech team was impacted the most. The layoffs specifically affected employees at the startup’s Mumbai and Bengaluru offices.

“We deeply regret the need for these workforce reductions of 20% as a part of Chingari’s organisational restructuring,” a Chingari spokesperson said.

Chingari has offered a two-month salary as severance pay to the laid off employees and extended their health insurance by three months.

Shortly after the layoffs, Inc42 also exclusively reported Chingari’s apparent pivot into the NSFW territory with paid live 1-on-1 calls between creators and users. The app has introduced the feature in an apparent bid to increase monetisation on the platform.

June 17 | Mojocare Fires 80% Workforce, Misconduct Allegations Surface Against Founders

Healthtech startup Mojocare fired more than 80% of its workforce as part of its cost rationalisation drive and focus on profitability. While media reports suggested a number of more than 200 employees being impacted, a spokesperson of the startup pegged the number at 150-170 employees. 

The development comes nearly 10 months after Mojocare raised a funding of $20.6 Mn from the likes of B Capital, Chiratae Ventures, Sequoia India’s Surge and Better Capital.

Shortly after the layoffs, Mojocare’s founders admitted before the board and investors of the startup that they had fudged numbers. Sources told Inc42 that Mojocare founders approached investors in May and confessed to round-tripping of funds.

For now, the group of investors has appointed an interim CFO, asked the founders to step away, and is considering a legal action against the founders. As for Mojocare, the startup’s operations have been suspended and it is staring down the barrel of dissolution.

June 14 | Mamaearth To Shut Momspresso’s MyMoney, Brand Marketing Vertical; 80 Employees Impacted

IPO-bound D2C unicorn Mamaearth will shut Momspresso MyMoney, the influencer engagement platform of Momspresso, later this month due to the latter’s mounting losses, sources told Inc42. The move led to 80 employees at Momspresso being fired.

According to Inc42 sources, in a town hall meeting in the first week of April, Momspresso’s top management, including the cofounders, informed the employees about the decision to shutter MyMoney. The D2C beauty unicorn is also likely to shut Momspresso’s brand marketing business, multiple sources informed us.

Mamaearth acquired the parenting platform Momspresso in 2021 for INR 152.3 Cr. The platform currently operates three verticals – user-generated content platform, brand marketing, and MyMoney.

June 12 | Freshworks Fires Employees For The Third Time

Freshworks has seen another round of layoffs across multiple teams in the US, citing performance reviews. The layoffs have happened within senior positions in the SaaS unicorn’s product, engineering and go-to-market (GTM) teams, sources told Moneycontrol.

When Inc42 reached out to the listed SaaS unicorn for clarification, a spokesperson said, “Freshworks does not comment on the management of the workforce in our normal course of business. There have been no organisation-wide layoffs to report.”

Freshworks fired around 2% of its staff – around 90 employees – in December 2022. While there were no confirmations from the SaaS unicorn on the number of impacted employees during the second layoff round in March, media reports indicated around 114-125 staff being impacted.

June 1 | Glamyo Health Joins Indian Startup Layoff Spree

Glamyo Health reportedly fired employees without any prior notice or without any clarity on final salary settlements, according to a police complaint cited by a YourStory report. The complaint, filed by an employee at Barakhamba Road police station in New Delhi, reportedly also claims that Glamyo Health delayed salary payments ‘several times’ over the last few months.

“About 50 employees were let go in the last two months with the aim of cutting costs and containing losses. But almost all the employees were asked to leave in the last two days without any information of severance, salaries or reasoning,” the report quoted a former employee as saying.

A legal representative of Glamyo was cited as terming the claims ‘baseless allegations’, as Inc42 did not hear back from the startup till the time of publishing of the article.

May 30 | Mensa Brands Cuts Jobs From Recently Acquired India Lifestyle Network 

House of Brands unicorn Mensa Brands laid off around 30 employees from India Lifestyle Network (ILN), which it acquired in December last year.

A spokesperson of Mensa Brands told Inc42 in a statement, “ILN is committed to providing the best content to its consumers and industry-leading services to its client partners. To enhance efficiency post-integration, we restructured some teams that impacted a few positions. This activity affected less than 30 team members in ILN.”

The Mensa spokesperson said the startup is providing each of the impacted employees up to three months’ salary, extended health insurance and support in finding new roles.

May 25 | Inc42 Exclusive: Prosus-Backed Airmeet Lays Off 75 Employees

Virtual events platform Airmeet fired about 30% of its 250-300 people workforce or at least 75 employees, sources told Inc42. The layoffs impacted multiple teams, including sales, marketing, tech, and operations. Besides India, employees working in the US, and Europe, among others, were also impacted by the layoffs.

In an internal mail, Lalit Mangal, cofounder and CEO of Airmeet, said the startup had to lay off employees as its ‘execution’ was not yielding the desired outcomes. Inc42 has accessed the mail sent by Mangal. Mangal confirmed the layoffs with Inc42 but didn’t disclose the number of employees impacted.

The startup has offered two months of salary as severance pay to the Indian employees and acceleration of vesting of all ESOPs options till June 30, 2023. It will also extend its health insurance coverage for these employees till August 18, 2023.

The layoffs came more than a year after Airmeet raised $35 Mn in its Series B funding round from Prosus Ventures, Sistema Asia Fund, RingCentral Ventures, KDDI Open Innovation Fund, DG Daiwa Ventures and Nexxus Global.

May 12 | Inc42 Exclusive: CRED-Owned Happay Cuts 35% Workforce

Fintech unicorn CRED-owned Happay has reduced its workforce by approximately 35%, sources told Inc42. At least 160 employees across various departments, including sales, marketing, tech, product and operations were let go as part of a restructuring exercise.

While sources told Inc42 that the restructuring was related to employee performance and was part of the appraisal process, Happay did not revert to a detailed questionnaire till press time.

As part of the severance package, the startup is offering employees three months’ salary along with additional benefits, such as an extension of insurance coverage and job placement assistance.

The layoffs come after Kunal Shah’s CRED spent $180 Mn on acquiring Happay in December 2021.

May 8 | Gold Loans Startup Rupeek Fires 20 More Employees Citing Restructuring

Sequoia-backed Gold loans startup Rupeek fired 20 more employees, around 2% of its workforce, as it looks to become profitable amid an ongoing funding crunch.

A Rupeek spokesperson told Inc42, “We have witnessed strong growth and efficiency gains that take us closer to becoming profitable. As we continue to assess the volatile market situation and take strategic and proactive steps to adapt, it is necessary to maintain a leaner and more agile organisation. Unfortunately, this also meant that we had to make the difficult decision to part ways with less than 2% of our workforce.”

The startup incurred a total loss of INR 364.3 Cr in FY22, a 2.3X jump from INR 156.3 Cr in FY21, while Rupeek saw its total revenue climb to INR 132.4 Cr in FY22, a 49% jump from INR 88.5 Cr in FY21.

May 8 | Edtech Startup Cuemath Fires 100 Employees Citing Restructuring

Cuemath restructured its management and laid off its employees, with founder Manan Khurma returning as its full-time CEO. According to media reports and Inc42 sources, the company has fired around 100 employees.

“Some functions and roles will also be rationalised to reflect our increased focus on LCX and retention. While this will impact some talented people who have contributed a lot to Cuemath, we are committed to supporting our affected colleagues with everything they need to ensure a smooth transition into the next phase of their professional journey,” Khurma said on LinkedIn.

The development comes less than a year after the edtech raised $57 Mn in June 2022, as it saw its standalone losses reach INR 216.6 Cr in FY22.

May 5 | Inc42 Exclusive: Edtech Startup Teachmint Fires 70 Employees

Teachmint conducted its second round of layoffs since the onset of funding winter, having fired over 70 employees, sources told Inc42. Employees working in talent acquisition, tech, and support roles; and quality analysts were impacted during this round of layoff.

Employees were informed about the layoffs in a town hall held by the top management, including founders, on May 4, sources privy to the matter informed Inc42. Teachmint confirmed the layoffs to Inc42 without disclosing the number of impacted employees.

In a statement, the startup said that they are working to provide support to the impacted employees. The layoffs come after the startup’s net loss surged 24X to INR 131.7 Cr in FY22 from INR 5.5 Cr in FY21, while its revenue from operations stood at INR 77.45 Lakhs in FY22. The startup’s first year of operations was FY22.

May 5 | Meesho Fires 251 Employees In Third Round Of Layoffs

Ecommerce unicorn Meesho fired 251 employees or about 15% of its present workforce of 1,675 as a part of a cost-cutting exercise. The ecommerce giant’s cofounder and CEO Vidit Aatrey informed the employees of the decision in an email earlier on May 5.

“As leaders, we made judgement errors in over-hiring ahead of the curve. At the same time, we could have run our org structure in a more effective and lean manner overall,” said Aatrey in the email. This was Meesho’s third round of layoffs, having fired 450 employees over two layoffs in 2022 before.

A Meesho spokesperson told Inc42 that the exiting employees will be entitled to a separation package that includes a one-time payment of 2.5-9 months, depending on the tenure and designation, insurance benefits, job placement support and accelerated vesting of ESOPs by one year.

April 29 | Data Startup Cogito Laid Off 177 Employees 

New York and Delhi NCR-based automation startup Cogito fired 177 employees after the project they were working on was scrapped, leading to protests by the impacted employees who claimed they were not paid any remunerations before being let go.

Speaking with Inc42, Cogito CTO Rohit Agrawal said, “Due to the current market environment, a client of ours decided to abruptly ramp down their operations,” which led to the 177 employees working on the project being let go.

He further refuted the employees’ claims and added that every employee was paid April salaries and they were satisfied with the company’s actions.

April 26 | Inc42 Exclusive: Edtech Startup Extramarks Fires 300 Employees

Edtech platform Extramarks laid off over 300 employees in a restructuring exercise as it is looking to shut down its B2C vertical, sources told Inc42. While most of the employees let go were from the closing B2C vertical, employees from sales, customer support, HR, marketing, tech, and content teams were also impacted.

While Extramarks has stopped onboarding new students for its B2C vertical, it would continue to provide its services to the existing students.

The company did not respond to Inc42’s queries. In an internal mail seen by Inc42, the startup said it would pay the laid off employees salary till April 20 and an additional pay as per their respective notice periods.

April 25 | Inc42 Exclusive: Skill-Lync Lays Off 400 Employees

Skill-Lync, which provides job opportunities to students upon completion of the programme, fired over 400 employees in a restructuring exercise, sources told Inc42. The impacted employees were from sales, marketing, pre-sales, tech and talent acquisition departments.

Skill-Lync cofounder SuryaNarayanan PaneerSelvam informed the employees about the layoffs in an internal mail and attributed it to the “recent macroeconomic conditions”. Inc42 has accessed the mail sent by PaneerSelvam. “This doesn’t reflect in any way on the performance of the individual,” the cofounder wrote in the mail.

The startup offered severance packages to the laid off employees based on their respective notice periods. Besides, Skill-Lync also closed the shutters of its Delhi NCR office post the latest layoff round, the sources told Inc42.

April 20 | Neobanking Unicorn OPEN Fires 47 Employees Citing Performance

Neobanking unicorn OPEN laid off 47 employees based on performance evaluation, the company said. OPEN also said that all four of its cofounders have taken a 50% salary cut. However, it added no other employee will be subjected to any such pay cuts.

“While 47 Openers were exited based on performance, the company is actively recruiting for critical functions such as growth marketing, product, and sales functions to continue growing the business and better serve its customers,” OPEN said in a statement.

“As a part of scale up and profitability, OPEN will continue the efforts to make a highly performance-oriented effective organisation fit for scale and is one of the very few startups with visibility on profitability and runway above 30 months to well face the market conditions,” said the cofounder Anish Achuthan.

The startup has offered a one-month notice period worth of salary to the impacted employees.

April 19 | BNPL Soonicorn Simpl Fires 120-150 Employees In A Cost-Cutting Exercise

BNPL platform Simpl fired an undisclosed number of employees, though media outlets have reported between 120 and 150 people impacted by the layoffs. It was not immediately clear as to which teams were impacted by the layoffs.

“In lieu of the current economic condition and preparing for the new economic reality, we’ve re-looked at our headcount towards becoming a leaner and agile organisation. We are sincerely grateful to the employees for their valuable contribution,” a Simpl spokesperson told Inc42.

Simpl’s cofounder and CEO Nitya Sharma reportedly did a virtual town hall and informed employees that the move would help the startup extend its runway. The startup has offered a severance package to the outgoing employees, though it did not share the details of the package with Inc42.

April 17 | FamPay Sees Top Level Exits, Fires Employees Amid Funding Crunch

Teen-focused fintech platform FamPay fired employees as it looks to extend its runway amid an ongoing funding winter. The startup also saw head of engineering Shobhit Gupta, Brijesh Bhardwaj, who oversaw product and growth and Fatema Raja, who led the design team, resign from the startup.

While media reports suggested that FamPay fired up to 50 employees, the startup’s founder said in a tweet that that less than 10 employees have been impacted by the retrenchments.

FamPay saw its loss widen to INR 50 Cr in FY23 from INR 43.3 Cr reported in the previous fiscal. The fintech company posted a meagre INR 3 Cr in operating revenue in the year ended March 2022.

April 14 | Inc42 Exclusive: Drip Capital Fires 20% Staff Without A Clear Reason

Trade financing startup Drip Capital laid off about 20% of its 400-member workforce in November last year in a restructuring exercise, sources told Inc42. The tech, engineering and sales departments took the biggest hit in the retrenchments.

The sources told Inc42 that the startup did not give a clear reason for the layoffs, and when Inc42 reached out to the startup on the matter, it declined to comment. The sources said that CEO Pushkar Mukewar announced the business restructuring plan during a town hall meeting with all employees in mid-November last year.

Within hours, the impacted employees were separately asked to resign over emails. Drip Capital gave a two-month salary as severance pay to the impacted employees and it cleared the full and final payments within 15 days.

April 10 | EV Maker Euler Motors Fires 10% Workforce Six Months After Raising $60 Mn

EV manufacturer Euler Motors has laid off 10% of its employees across departments citing restructuring. While the company’s LinkedIn page shows around 500 employees, taking the number of impacted employees to 50, an Inc42 source said the number was between 180 and 200.

“We are restructuring our company to better deliver to customers as well as to investor expectations of greater efficiency in the context of changing global circumstances,” said a company spokesperson in a statement on Monday (April 10).

The startup claimed that it has provided “appropriate” severance to the laid-off employees. The layoffs come after its net loss almost doubled to INR 36.3 Cr in FY22.

April 8 | Healthech Major Practo Fires 41 Employees

Practo fired 41 employees as part of its performance management and planning process. In a statement sent to Inc42, the startup confirmed the development saying that it will provide all required support to the impacted employees.

At the same time, the company claimed that it was not undergoing any restructuring exercise and that the employees were handed pink slips over performance issues.

“… as part of our continuous performance management and planning process, we had to part ways with 41 employees in accordance with their employment contracts. As always, we are and will remain fully committed to providing the requisite support to all employees who may be impacted,” a company spokesperson said.

April 7 | ZestMoney Fires 20-30% Workforce As PhonePe Deal Collapses

ZestMoney has laid off between 20% and 30% of its workforce as part of a cost-cutting exercise after PhonePe cancelled its plan to acquire the BNPL platform. While Inc42 sources said the number was close to 30%, other media outlets reported a number close to 20%, translating to about 100 employees impacted across departments.

Sources further said a sizeable chunk of the employees are moving to PhonePe, even as the fintech decacorn pulled the plug on the deal to buy ZestMoney over multiple issues, including due-diligence issues, disagreements over valuation, sustainability of the business and the shareholding structure.

ZestMoney has paid the impacted employees one month’s salary as severance pay and other benefits like insurance and mental health assistance.

April 6 | Dunzo Fires 30% Staff In Second Layoffs In Three Months

Dunzo went for another round of layoffs within three months as it fired 30% of its employees ahead of a business model shift. Reportedly, the number of impacted employees comes to around 300.

Following the layoffs, the quick commerce unicorn will shut down 50% of its dark stores and run only those which can either be profitable or are close to being profitable. Dunzo will partner with supermarkets and other merchants wherever it shuts down dark stores.

The unicorn’s consolidated loss in FY22 widened 2X to INR 464 Cr from INR 229 Cr in FY21 on the back of a doubling of its expenses.

April 4 | 1K Kirana Fires 40% Employees Citing Restructuring

Gurugram-based Kirana tech startup 1K Kirana fired 40% of its workforce, citing a restructuring and closure of operations in a few regions.

As per the startup’s LinkedIn page, it had 1,052 employees at the beginning of April, taking the impacted employees to 421. However, media reports suggest the number could be more than 600 employees.

In a statement shared with Inc42, 1K Kirana cofounder Kumar Sangeetesh said, “We are currently in the process of restructuring as our growth forecasts have changed. We are changing our focus areas and moving out of a few geographies. Due to this, we have to let go of 40% of our employees. All the employees will be given severances and we will assist them with outplacements.”

The development comes less than a year after the startup raised $25 Mn in a Series B funding round in May 2022.

March 30 | Temasek-Backed Blue-Collar Jobs Platform GoodWorker Fires 90% Staff Ahead Of Acquisition

Bengaluru-based blue-collar job discovery platform GoodWorker, backed by the likes of Temasek, fired 90% of its employees, per a DealStreetAsia report. The retrenchments have impacted employees across departments.

Per the startup’s LinkedIn page, it has 190 employees, therefore, the retrenchments could have impacted as many as 171 employees. GoodWorker has also been reportedly acquired by Affinidi, a Singapore-based decentralised identity verification platform, which is also backed by Temasek.

Interestingly, GoodWorker is a joint venture between SchoolNet and LemmaTree, and the latter is a wholly-owned subsidiary of Temasek. As such, the retrenchments and the fire sale seems to have been orchestrated by the Singapore-based investor.

March 30 | Unacademy Fires 12% Of Workforce In Fourth Round Of Layoffs In 12 Months

Unacademy fired 12% of its workforce in the fourth round of layoffs at the edtech unicorn. While media outlets reported a number of around 380 employees, according to Inc42 data, the number would be around 540, post the three layoffs it has done before.

In a Slack message sent to the team, Unacademy CEO and cofounder Gaurav Munjal said, “We have taken every step in the right direction to make our core business profitable, yet it’s not enough. We have to go further, we have to go deeper.”

He added, “Unfortunately, this has led me to take another difficult decision. We will be reducing the size of our team by 12% to ensure that we can meet the goals we are chasing in the current realities we face.”

The outgoing employees will be eligible for a severance pay equivalent to the notice period and an additional month’s pay, along with accelerated vesting of one year for employees that were with Unacademy for at least one year.

March 30 | Inc42 Exclusive: FanClash Fires 75% Workforce Following Business Model Pivot

Delhi NCR-based fantasy esports startup FanClash laid off around 75% of its workforce this year, according to Inc42 sources. The startup undertook the layoff exercise in three rounds and fired about 100 employees, the sources said.

Apart from firing employees, the startup also shut down FanGuild, a fantasy Web3 gaming platform, and halted operations of its fan engagement platform FanSpace.

“Considering the temporary uncertain environment towards mobile esports, we had no option but to restructure our business which meant that we had to ask 75% of our workforce to leave,” said a company source, requesting anonymity.

Inc42 sources added that the impacted employees were given a two-month salary as a severance package.

March 17 | Freshworks Goes For Round Two Of Layoffs

Freshworks undertook a fresh round of retrenchments, a second round of layoffs in the past three months. Without specifying the number of employees impacted in the exercise, Freshworks said that the move has been made to strengthen organisational and operational efficiencies.

“Freshworks has not conducted org-wide layoffs and continues to hire for open positions. We continue to review organisational efficiencies to avoid duplicated efforts and maintain a strong performance culture. As a result, a small number of individuals are impacted and are leaving the company,” a Freshworks spokesperson said.

The development came three months after Freshworks fired ‘less than 2%’ of its workforce amid an organisational reshuffle.

March 15 | Inc42 Exclusive: Home Decor Unicorn LivSpace Fires 100 Employees Citing Restructuring

Home renovation and interiors platform Livspace fired 100 employees, or 2% of its workforce, as part of a cost-cutting exercise, sources told Inc42. Product, engineering, content, and marketing teams were the most impacted by the layoffs, a source added.

“Our focus continues to be on the most efficient deployment of capital and resources to maximize value for our shareholders, customers, partners and employees,” the company said in a statement, adding, “in a company of our size, we will, in the normal course of our operations, redeploy resources. This is organic and a reflection of normal adjustments and/or performance management parameters.”

Without sharing details, LivSpace said it is extending an assistance package and healthcare coverage to the impacted employees. The startup has raised close to $430 Mn across funding rounds, entering the unicorn club in February 2022.

March 15 | Inc42 Exclusive: Retailtech Startup Dukaan Fires 30% Workforce Citing Restructuring

Retail tech startup Dukaan laid off around 56 employees, or around 30% of its workforce, sources told Inc42. The layoffs, due to a change in Dukaan’s focus to D2C brands from SMBs, affected inside sales team and account managers.

Dukaan offered a two-month salary as a severance package to the impacted employees. Suumit Shah, Dukaan’s founder and CEO, confirmed the development to Inc42.

Dukaan last raised $12.4 Mn in its pre-Series A round, led by 640 Oxford Ventures, in September 2021. In all, the retailtech startup has raised more than $18 Mn in funding across its seed and Pre-Series A round.

March 6 | upGrad Campus Lays Off 30% Workforce Amid Prolonged Funding Winter

Video learning platform upGrad Campus fired 30% of its total workforce, accounting for nearly 120 employees, Indian Express reported. It was unclear if the layoffs were targeted at a specific department within the startup.

Impartus, as upGrad Campus was known prior to its acquisition in March 2021, operates independently as an upGrad subsidiary. The layoffs at upGrad Campus are the second one at a subsidiary of the Ronnie Screwvala-led edtech unicorn.

In January, Harappa Education, which was acquired by upGrad in July 2022 for $38 Mn, fired 40% of the workforce or about 73 employees.

March 2 | Inc42 Exclusive: Fitness Startup Fittr Fires 11% Workforce Citing Role Redundancy

Pune-based fitness startup Fittr laid off 11% of its workforce, or around 30 employees, across marketing, sales, client servicing and tech teams, sources told Inc42. The sources added that the company may have fired as many as 60 employees, though the claim remained unconfirmed.

In a statement given to Inc42, the cofounder and CEO of Fittr, Jitendra Chouksey, said the company had to let go of people due to role redundancy (11% of the total workforce in a span of 6-8 months). “Meanwhile, we did hire to backfill certain critical positions,” Chouksey added.

According to Fittr’s MCA filings, it slipped into losses in FY22. The startup registered a loss of INR 25.2 Cr in FY22 against a profit of INR 49.04 Lakh in FY21, even though its revenue from operations rose to INR 83.05 Cr in FY22 from INR 52.7 Cr in FY21.

March 1 | Conversational AI Startup Yellow.ai Lays Off 15% Employees Amid Funding Winter

Conversational AI startup Yellow.ai has fired 15% of its employees since August, on account of slow growth and a bloated workforce. According to media reports, the SaaS startup has carried out two layoffs between August 2022 and February 2023.

The startup has 1,063 employees, according to its LinkedIn profile. Confirming the development to Inc42, a Yellow.ai spokesperson said, “We had to reorganise some of the teams to double down on high-priority, high-growth areas, which in turn has affected 15% of the company.” The spokesperson added that the company is supporting the outgoing employees, without sharing details of any severance packages.

The layoffs come just months after Yellow.ai announced a $43 Mn ESOP plan for its employees. The startup has raised more than $102 Mn across funding rounds so far, with the latest round coming in August 2021 when Yellow.ai raised $78.15 Mn from the likes of WestBridge Capital, Sapphire Ventures and Salesforce Ventures.

February 22 | Edtech Startup Camp K12 Fires 70% Employees

Edtech startup Camp K12 reportedly fired 70% of its workforce without paying any dues to the impacted employees. While Inc42 could not reach Camp K12, media reports suggest that it might have laid off as many as 300 employees, of the 433 it had, according to its LinkedIn account.

According to media reports, the coding edtech startup has not paid salaries to its employees since December 2022; the layoffs took place in January 2023. The company has allegedly not paid any salaries to the impacted employees and it is not letting the remaining employees resign either.

Another edtech startup on the verge of capitulation, Camp K12 has raised $16 Mn in funding across two rounds, with the startup last raising $12 Mn in August 2021.

February 21 | Crypto Startup Polygon Fires 20% Staff As Crypto Winter Extends

Ethereum Layer-2 scaling startup Polygon laid off around 20% of its workforce, or 100 employees, as part of a restructuring exercise amid the ongoing crypto winter. The startup has fired employees across multiple business functions.

“Earlier this year, we consolidated multiple business units under Polygon Labs. As part of this process, we’re sharing the difficult news that we’ve reduced our team by 20% impacting multiple teams and about 100 positions,” the startup said in a blog post.

Polygon said that the employees impacted will receive a three months’ pay as severance, regardless of their level or tenure. The layoffs come a year after Polygon raised $450 Mn in a funding round, led by Sequoia India

February 20 | Security Management Startup MyGate Fires 30% Staff Amid Funding Crunch

Community and security management startup MyGate has reportedly laid off 30% of its employees across mid-management and junior roles. The startup’s total headcount was reduced from 600 pre-layoffs to 400.

Only a few laid off employees were offered a salary of two months as a severance package, while others did not receive severance at all, according to media reports.

Founded in 2016, MyGate offers security solutions for apartment complexes at entry and exit gates, along with other security systems such as RFID cards, biometrics and vehicle stickers. It has raised $79.5 Mn in VC funding to date.

February 14 | Inc42 Exclusive: Healthtech Platform Phablecare Faces Capitulation, Fires 350 Employees

In another startup capitulation story amid the harsh funding winter, healthtech platform Phablecare has fired 350 employees, nearly 50% of its workforce. The startup is currently facing a funding crisis and has held back the salaries of employees.

While sources told Inc42 that Phablecare has laid off around 350-400 employees so far, hundreds voluntarily resigned due to the delays in getting their salaries. The founders are yet to revert to a detailed questionnaire sent by Inc42.

In the meanwhile, the founders communicated to the staff as late as January that they were trying to raise funds. Phablecare’s situation is still developing as its day-to-day operations have taken a beating.

February 14 | Prime Venture-Backed HackerEarth Fires 9% Employees, Introduce Pay Cuts

Tech-focused skilling and hiring startup HackerEarth laid off nearly 9% of its employees working in different verticals, according to media reports. The number of employees impacted was around 17 of a total headcount of 190.

Sachin Gupta, CEO of HackerEarth, said, “2020 and 2021 were years of strong growth for us. We built a team in anticipation of this trend continuing. Instead, the second half of 2022 saw a slowdown in hiring, which resulted in lower growth in our business than what we had prepared ourselves for.”

HackerEarth has provided a severance package including eight weeks of pay to impacted employees. While employees with more than two years of stint in the company have been given one additional week of pay for every year of their service.

February 6 | FilterCopy Parent Pocket Aces Fires 25% Staff To Cut Costs

Digital entertainment startup Pocket Aces, which owns YouTube channels such as FilterCopy and Dice Media, fired a quarter of its workforce, or about 25 employees. The job cuts impacted employees in content, production and post-production teams.

Aditi Shrivastava, cofounder and CEO of Pocket Aces, told Inc42, “It has been a tough decision to part with some of our talented team members and friends. However, we must keep innovating our operating models, and this is the right thing to do in order to ensure that we remain agile with the changing audience preferences. We deeply care about the people leaving us and will provide them with financial support, and ongoing health insurance coverage and help them with their transition.”

The company further added that it would keep engaging with some of the outgoing employees on a freelance basis.

February 3 | Inc42 Exclusive: SaaS Logistics Startup FarEye Fires 90 Employees In Layoffs Round Two

Microsoft-backed SaaS logistics startup FarEye laid off 90 employees in a second round of layoffs in just eight months. The startup has fired 340 employees or around 45% of its workforce before the first layoffs. The job cuts impacted people across tech, product, HRBP and sales, sources told Inc42.

Confirming the layoffs, FarEye cofounder and CEO Kushal Nahata told Inc42 in a statement, “The reduction in staff was necessary to align business strategy with market demand and continue to serve our customers’ business needs, as has always been our mission. Our focus on product innovation and customer solutions remains strong, and we will continue to expand our reach in new industries and markets around the globe.”

While the startup did not go into the specifics, it said it has offered severance packages to the impacted employees as per the local laws.

January 27 | Ecommerce Unicorn DealShare Fires 100 Employees To Cut Costs

Tiger Global-backed grocery delivery unicorn DealShare fired 100 employees or about 7% of its 1,500-strong workforce in a bid to reduce monthly burn rate. The move impacted employees across all teams, according to the unicorn’s founder Sourjyendu Medda.

“We have removed the roles as a result of the current market conditions. We look at the business plan for the year and we have reduced the focus on some of the areas which would need very long-term capital infusion before becoming totally profitable,” said Medda, confirming the development to Inc42.

The grocery delivery unicorn did not specify the details of the severance benefits the outgoing employees would be entitled to.

January 25 | Inc42 Exclusive: SaaS Startup SirionLabs Fires 130 Employees Days After Raising $25 Mn

Sequoia and Tiger Global-backed SaaS startup SirionLabs fired around 15% of its total workforce, or about 130 employees, days after announcing a Series D fundraise of $25 Mn, Inc42 exclusively reported. Employees in DevOps, analysts, and support teams were impacted by the layoffs.

In a mail sent to the employees, Ajay Agrawal, the founder and CEO of the contract management startup, informed the employees about the decision. Inc42 has reviewed the mail sent to the employees by Agrawal. In the mail, Agrawal said that the startup has to shift its business strategy towards profitability due to the current macroeconomic environment, and this will result in downsizing.  

SirionLabs offered a salary of two months as a severance package to the impacted employees.

January 24 | Inc42 Exclusive: Healthtech Unicorn Innovaccer Goes For Second Layoff Round, Fires 245 Employees

Tiger Global-backed healthtech unicorn Innovaccer fired around 15% of its workforce, or 245 employees, in the second round of sackings at the unicorn within four months. The layoffs impacted teams in India and the US across multiple departments, Inc42 exclusively reported.

Confirming the development with Inc42, the unicorn’s cofounder and CEO Abhinav Shashank cited an ‘uncertain macroeconomic environment’ as the reason for the second round of layoffs. The cofounder said that Innovaccer will deprioritise certain areas that distract the unicorn from its “core portfolio”.

The startup will offer severance packages to the impacted employees along with transitional health insurance benefits, and job placement support, an Innovaccer spokesperson told Inc42. The round of layoffs also comes after the unicorn fired 90 employees in September 2022.

January 23 | India’s First Unicorn InMobi Fires 50-70 Employees After Performance Review

InMobi, India’s first-ever unicorn, fired around 50-70 employees or about 3% of its workforce after it concluded a performance review, Business Standard reported. The impacted employees are both from InMobi and its mobile advertising platform Glance.

“InMobi/Glance is in the market actively hiring talent for the ambitious plans that we have. We also evaluate the performance of our existing talent on an annual basis and make decisions based on it. This is business as usual for us and part of our annual process. This year is no different,” the adtech company was cited as saying.

The company also announced that it will skip increments for CY23 and also undertake recruitment only when required.

January 20 | Inc42 Exclusive: MediBuddy Fires 200 Employees After Restructuring

Lightrock India-backed healthtech startup MediBuddy fired around 200 employees after conducting a restructuring exercise. The tech, product, sales and operations teams were the worst impacted because of the sudden layoffs, sources told Inc42.

“While layoffs are never easy and it is painful in the short term, this was to realign our current business goals for long-term stability and growth. In this entire process of realignment, we had to part with 8% of the workforce across all departments as a one-time restructuring exercise and eliminate any redundancy in roles and responsibilities,” MediBuddy said in a written statement.

MediBuddy said it would provide outplacement assistance to the impacted employees. Further, it has designed a care package that includes MediBuddy wallet continuity and extended health coverage.

January 20 | Swiggy Lays Off 380 Employees Citing Restructuring To Cut Costs

Food delivery major Swiggy fired 380 employees as part of a restructuring exercise to cut costs, founder and CEO Sriharsha Majety said in an email to the employees on January 20. The layoffs impacted around 5% of Swiggy’s workforce.

“While we’d already initiated actions on other indirect costs like infrastructure, office/facilities, etc, we needed to right-size our overall personnel costs also in line with the projections for the future,” added the CEO. The layoffs come after Swiggy reported a 2.2X growth in its losses, which reached INR 3,628.9 Cr in FY 22 compared to INR 1,616.9 Cr in FY21.

Swiggy is offering several benefits to the outgoing employees, including a payout worth at least three months of salary, including all the bonuses and incentives. Employees can also avail of the payout equivalent to their notice period, plus 15 days ex-gratia for every completed year of service.

January 19 | Hubilo Goes For A Second Layoff, Fires 115 Employees 

Event management startup Hubilo laid off 115 employees or around 35% of its workforce in a restructuring exercise.

In a written statement, the startup said, “Hubilo has made the difficult decision to restructure the company amid global macroeconomic conditions. Approximately 35% of the company was laid off as a result. We have made our best effort to ensure that the impacted employees are supported with generous severance packages as well as outplacement services to give them a smooth transition.”

Hubilo fired employees for the second time in six months after it fired around 45-50 employees in July 2022.

January 17 | Inc42 Exclusive: Exotel Lays Off 80 Employees

Bengaluru-based cloud telephony platform Exotel laid off 142 employees, or 15% of its workforce, citing their poor performance, sources told Inc42.

The layoffs took place following a revision in the startup’s performance improvement plan (PIP) policy in November 2022, under which Exotel removed the clause of giving two warnings to employees for below par performance.

However, a company spokesperson told Inc42 in a statement that 80 employees were impacted due to the revision in PIP policy and business restructuring.

An Exotel spokesperson, without confirming or denying the number of employees sacked, attributed the recent layoff exercise at the startup to restructuring and mid-year review. 

“Recently, some members of our team have been affected due to our restructuring efforts (3%) & the mid-year review, business as usual performance improvement planning process (less than 5%),” the spokesperson said.

January 17 | Auto After-Sales Service Platform GoMechanic Fires 70% Employees

Automobile after-sales service startup GoMechanic sacked nearly 70% of its workforce, which amounted to nearly 500 employees being fired. 

While Inc42 could not immediately verify the details, media reports noted that the startup’s backer Sequoia has launched a forensic audit of its finances amid allegations of financial irregularities at the startup. The startup is said to have a total loans of INR 120 Cr and ‘market pendency’ of INR 40 Cr.

The Gurugram-based startup needs to raise funds in the ‘next few months, sources familiar with the development added, as the startup does not have any runway beyond that.

January 16 | Quick Commerce Soonicorn Dunzo Fires 3% Workforce After Shutting Dark Stores

Reliance-backed quick commerce startup Dunzo laid off nearly 3% of its workforce, having shut down a few dark stores a few months ago. While the startup did not clarify how many employees left the organisation, media reports reported a number between 60 and 80.

“Whatever the numbers, these are people who chose to build their careers with Dunzo, and it is sad to have talented colleagues leave us. We are extending the best support possible to help them during this transition,” Dunzo CEO and cofounder Kabeer Biswas said in a statement.

As with the number of employees fired, Dunzo did not clarify the severance packages given to the impacted employeer, nor the departments the employees were fired from.

January 16 | Foodtech Unicorn Rebel Foods Fires 50 Employees Citing Performance Review

Foodtech unicorn Rebel Foods fired 50 employees, or about 2% of its workforce, citing an annual performance review at the startup. The startup did not provide details on the departments the employees were fired from or the sewerage benefits the said employees would be entitled to, if any.

“Any news heard is on account of annual performance evaluation and realigning the organisation to our priorities for future goals. The impacted number is less than 2% of our organisational strength,” a Rebel Foods spokesperson said.

The layoffs come after the startup‘s net loss widened 55% YoY to INR 564.4 Cr in FY22 from INR 364 Cr in FY21, while its revenue also doubled to INR 907 Cr from INR 436.5 Cr in FY21.

January 16 | ShareChat, Moj Parent Mohalla Tech Fires 500 Employees 

Mohalla Tech Pvt Ltd, the parent company of content platforms Sharechat and Moj fired 500 employees or about 20% of its workforce. It was not immediately clear which departments were impacted by the layoffs.

In a statement, a Sharechat and Moj spokesperson said, “We’ve had to take some of the most difficult and painful decisions in our history as a company and had to let go of around 20% of our incredibly talented employees who have been with us in this startup journey.”

The impacted employees will be receiving the entire salary of their notice periods, two-weeks’ pay for each year served with the company and 100% of the variable pay till December 2022. Also, the company will allow impacted employees to encash unused leave balance of up to 45 days, while also allowing them to keep their office assets, such as laptops.

January 13 | Inc42 Exclusive: SaaS Start Skit.ai Fires 115 Employees Citing Restructuring

Bengaluru-based SaaS voice automation startup Skit.ai laid off around 115 employees citing restructuring at the firm, sources told Inc42. The sources added that the number could be as high as 130. The layoffs were announced by Skit.ai CEO and cofounder Sourabh Gupta during a town hall meeting. 

The startup has fired employees across business analyst, software engineering, product, operations, SPM and CSM roles, the sources said. Most of the laid off employees are from the India team as the startup shifts its focus to the US market, according to Inc42 sources.

The startup has offered two months of salary as a severance package to the laid off employees and will extend their insurance coverage for the next six months, while also allowing employees to keep their assets such as laptops and iPads, documents reviewed by Inc42 showed.

January 12 | Crypto Unicorn CoinDCX Fires Employees As Part Of Restructuring Drive

Crypto unicorn CoinDCX fired some employees as part of a restructuring drive at the cryptocurrency exchange, a source close to the development told Inc42. 

While the number was not immediately verifiable, media reports suggest that the crypto exchange has fired around 50 people from the sales and marketing teams at the company, or around 8% of its total workforce. The impacted employees have reportedly been given a month’s severance pay and let go after serving their notice periods. 

The layoffs come as a prolonged crypto winter and the recent collapses of FTX and Terra Luna have shaken the public confidence in crypto as an asset class in India.

January 12 | Payments Soonicorn Cashfree Sacks 80 Employees Citing Organisational Reshuffle

Fintech platform Cashfree Payments sacked 80 employees – as many as 13% of its workforce – across several teams as part of an organisational restructuring, sources told Inc42. The fintech soonicorn could have fired as many as 120 people, but that could not be verified.

However, the company claimed that only 6-8% of the employees were affected by the retrenchment. The details of any severance packages or any other benefits that the outgoing employees would have been entitled to were not clear either.

“The organisation has reevaluated the relevance of certain roles and functions leading to movement of talent within teams and a few employee exits. This process of organisational restructuring has impacted around 6-8% of employees,” said a Cashfree spokesperson.

January 12 | Ola Fires 200 Employees Citing Restructuring

Mobility startup Ola fired 200 employees across verticals, citing an organisational restructuring. The laid off employees are from Ola Cabs, Ola Electric, and Ola Financial Services verticals, sources told Inc42.

Confirming the development, a Ola spokesperson told Inc42 in a statement, “We regularly conduct restructuring exercises to improve efficiencies, and there are roles which are now redundant. We will continue making new hires in engineering and design including senior talent in our key priority areas.”

The company offered severance packages as per their respective notice periods, they said, adding that the layoffs began earlier this week. 

January 10 | LEAD Fires Another 60 Employees, Takes Total Layoffs To 100

Mumbai-based edtech startup LEAD laid off around 60 employees, mostly from the tech and product teams. However, the startup told Inc42 that it was a regular churn due to business activities.

In a statement shared with Inc42, LEAD said, “We have grown 2X this year and are hiring for growth. If projects don’t meet success criteria or don’t fit our strategic roadmap, teams are either re-assigned or asked to seek other opportunities. This is a regular business activity and a normal churn of 1-2 % in an organisation of 2,000 people.”

The layoffs came shortly after LEAD raised INR 35 Cr in debt from Alteria Capital, and shortly after the layoffs, the startup raised INR 160 Cr. 

January 10 | Unacademy-Owned Relevel Fires 40 Employees As Company Pivots

Unacademy-owned Relevel plans to lay off 40 employees or nearly 20% of its workforce. In an internal mail sent to employees, Unacademy CEO and cofounder Gaurav Munjal cited Relevel’s pivot from core education business to test product business and focus on the newly launched NextLevel app as the reason for the layoffs.

“Almost 80% of Relevel’s remaining team will be absorbed by other businesses of Unacademy Group and we will have to let go of around 20% (around 40 people) of the team because of lack of availability of roles for them,” Munjal said in the mail. 

The impacted employees would be provided with severance pay equal to the notice period and an additional two months. Besides, the company also said that the laid off workers would also get accelerated vesting, medical insurance and placement support.

January 6 | Bike Rental & EV Startup Bounce Fires 3-4% Of Staff Citing Restructuring

Bike rental and electric vehicle (EV) startup Bounce laid off around 3-4% of its total workforce as part of an ongoing ‘restructuring drive’. The layoffs largely affected customer service and other segments, Bounce said.

A company spokesperson told Inc42 that the employees were “let go off” phase wise and the exercise largely affected the non-original equipment manufacturer (OEM) vertical. As per the company, the layoffs largely affected customer service and other segments.

It is prudent to mention that media reports have mentioned a much higher number, to the tune of almost 250 employees being fired. The startup, however, has denied the claims.

January 5 | Ecommerce Rollup UpScalio Fires 15% Of Staff Citing Performance Review

UpScalio became the first Thrasio-style startup in the country to lay off employees, as it fired around 15% of its staff citing a performance review.

In a statement shared with Inc42, Ankur Singh, head of people and culture at UpScalio, said, “While UpScalio has been able to grow aggressively, we always keep a keen eye on profitability. As part of our standard annual employee appraisal process, in December, we have let go of 15% of our staff.”

The layoffs come nine months after the ecommerce rollup startup raised $15 Mn in its pre-Series B funding round in March 2022. UpScalio has raised around $60 Mn from investors across funding rounds.

January 5 | B2B Marketplace Moglix Fires 40 Employees Citing Automation

B2B industrial goods marketplace Moglix fired 40 employees – around 6% of its total workforce – citing process automation and performance reviews. While other media reports mentioned the number could be as high as 200, Inc42 could not independently verify the same.

“We have hired 700+ people this year and continue to expand with a target to hire 300+ people for 2023. We keep a watch out for low performers and continue to automate tasks, for which annually 2-3% of people can be impacted,” said Moglix in a statement.

Moglix posted a loss of INR $21.03 Mn in FY22, up 88.1% from $11.18 Mn in FY21. At the same time, its revenue rose 192% to $306.9 Mn from $105.2 Mn in FY21.

January 4 | upGrad-Owned Harappa Education Fires 40% Of Workforce After Business Model Change

upGrad-owned edtech startup Harappa Education fired around 73 employees – about 40% of its workforce – in the first layoff of 2023. The startup laid off employees from content, design, product, and marketing teams, sources told Inc42.

Harappa might just see more layoffs this month, as sources told Inc42 that more employees are likely to lose their jobs in the coming days. “This is the first phase of layoffs and there could be more. It seems that two lists were made – one for December and the other for January. Hence, in January more layoffs are expected,” the sources told Inc42.

Harappa Education was acquired by edtech unicorn upGrad for $38 Mn (INR 300 Cr) in July 2022. Last September, upGrad announced plans to invest $40 Mn (INR 320 Cr) in Harappa Education to drive the edtech’s growth.

December 26 | PayU India Fires 150 Employees After Org Reshuffle

PayU India, the payments and fintech unit Prosus, laid off around 6% of its workforce or around 150 employees citing an organisational reshuffle in India. The layoffs mainly affected PayU India’s digital payment security and mobile payment technology unit Wibmo, which it acquired for $70 Mn in 2019.

“Keeping in mind our highest strategic priorities, we are realigning teams across some of [our] businesses in India. As a result of which, regretfully we will to have part ways with some of our colleagues,” a PayU spokesperson told Inc42.

The layoffs at PayU happened despite the fintech achieving profitability in FY22. The startup’s FY22 results showed a profit of INR 126 Cr against revenue of INR 2,130.3 Cr.

December 16 | Listed SaaS Unicorn Freshworks Fires 90 Employees Citing Org Rejig

Nasdaq-listed enterprisetech major Freshworks fired around 90 employees as part of an organisational reshuffle, or about 2% of its total workforce. The employees were fired across sales, marketing, and engineering verticals.

“We shifted some existing roles in product, marketing and sales to support more critical initiatives and reduced the need for a small number of others – less than 2% of our workforce. Freshworks did not do a company-wide layoff,” said a Freshworks spokesperson. The company paid severance packages and other settlements to the impacted employees.

In the third quarter of FY22, Freshworks reported consolidated revenue of $128.8 Mn, up 37% YoY. During the same period, the company narrowed its losses to $58.3 Mn from $107.4 Mn during the year-ago period.

December 8 | Swiggy Lays Off 250+ Employees Citing Performance Review

Foodtech unicorn Swiggy joined its competitor Zomato in having fired employees in 2022, with news coming that it may lay off 250+ employees or around 3% of its total workforce after a performance review.

“We concluded our performance cycle in October and have announced ratings and promotions at all levels. As with every cycle, we expect exits based on performance,” a Swiggy spokesperson told Inc42. The layoffs come off the back of Jefferies reporting that Swiggy’s losses during H1 FY23 were six times higher than Zomato’s standalone losses during the same time. 

Swiggy’s losses in the first half of FY23 were at around $315 Mn (INR 2,570 Cr), while Zomato’s standalone loss during the period remained around the $50 Mn (INR 410 Cr) mark.

December 7 | Vedantu Fires Another 385 Employees, Takes Total Layoffs To 1,109

Edtech unicorn Vedantu fired employees for the fourth time this month, laying off 385 people to take the total count to 1,109. The layoffs have impacted people from sales, HR and content teams.

The latest layoff comes around a month after the unicorn acquired a majority stake in Karnataka-based test prep platform Deeksha for $40 Mn. Internal sources told Inc42 that the startup was left with around 18 months of runway, prompting the decision to let go of employees again. Vedantu is left with 3,300 employees after the latest firings.

Vedantu is offering a salary of two months as a severance package and has extended the medical coverage for the fired employees till March 31, 2023, according to Inc42 sources.

December 3 | Inc42 Exclusive: Healthtech Startup HealthifyMe Fires 150 Employees Citing Global Recession Fears

Health and fitness startup HealthifyMe fired 150 employees, or about 15-20% of its total workforce, citing slow growth triggered by the fears of a global recession. Employees in SME (subject matter expert), quality analytics, product and marketing roles were impacted by the layoffs.

“We have had to take the tough decision to let go 150 of our team members. Like much of tech, growth hasn’t kept pace with expectations and hiring,” the startup said in a written statement. HealthifyMe will be offering a two-month severance package and will further extend medical coverage to the impacted employees.

The layoffs come a year and a half after the startup raised $75 Mn in a Series C round of funding, having raised $100 Mn to date.

December 3 | Inc42 Exclusive: Traveltech Major OYO Fires 600 Employees Across Multiple Teams

IPO-bound hospitality chain OYO fired 600 employees from tech roles in product and engineering teams. The layoffs come after OYO decided to merge the two teams.

“The downsizing in tech is also happening in teams which were developing pilots and proof of concepts such as in-app gaming, social content curation and patron-facilitated content,” said OYO in a statement. However, the hospitality chain did not provide any details of the benefits the outgoing employees would be entitled to.

Ritesh Agrawal, founder and CEO of OYO, added, “We will be doing all that we can to ensure that most of the people we are having to let go, are gainfully employed.” The layoffs come after OYO posted an adjusted EBITDA of INR 56 Cr in Q2FY23, its second consecutive EBITDA-positive quarter.

December 2 | Inc42 Exclusive: ShareChat Parent Shuts Down Fantasy Cricket Subsidiary Jeet11, Fires 100 Employees

Mohalla Tech Private Ltd, the parent company of ShareChat, has shut down its fantasy gaming platform Jeet11, sources aware of the development told Inc42. Mohalla Tech has also fired 100 employees, mostly from non-tech roles within Jeet11.

The shutdown comes two years after the ShareChat and Moj parent forayed into fantasy sport. “We can confirm that we are ceasing operations of Jeet11 and have reorganized some of our functions, which meant movement of this talent within teams and a few employee exits,” Mohalla Tech said, confirming the development.

The layoffs also come almost 19 months after the startup raised $502 Mn in its Series E round, becoming the first social media unicorn in the process.

November 30 | Inc42 Exclusive: Edtech Startup Teachmint Fires 45 Employees Citing Restructuring

Joining the contingent of edtech startup firing employees, Teachmint laid off 45 employees or about 5% of its workforce citing restructuring. Inc42 exclusively reported that the layoffs were conducted across sales and operations teams.

“The impacted employees have been informed in advance and we are supporting them to the maximum extent possible,” Teachmint said in a statement given to Inc42, confirming the development.

The layoffs came almost a year after the edtech startup raised $78 Mn in a Series B round led by new investors Rocketship.vc and Vulcan Capital. Teachmint has raised $118 Mn in total to date.

November 29 | Hiring Platform Hirect Fires 200 Employees Citing Restructuring

Bengaluru and US-based hiring platform Hirect fired 40% of its workforce, or 200 employees, citing an organisational restructuring and a change in its business model.

The layoffs triggered several social media posts from employees that were fired, alleging high spending on social media influencers, non-payment of PF contributions and dues, and non-receipt of relieving letters. Others reported that the startup did not provide any severance package or job search assistance as well.

According to Crunchbase, Hirect has raised nearly $15 Mn across several rounds. Incidentally, the startup was reported to have raised $14.6 Mn in its Series A just two days after conducting layoffs.

November 28 | VerSe Lays Off 150 Employees After Raising $805 Mn In April

The parent company of DailyHunt and Josh, VerSe Innovation, laid off 150 employees, or about 5% of its workforce of 3,000 before the layoffs. The startup also decided to undertake an 11% pay cut for employees with annual salaries of more than INR 10 Lakh, according to Inc42 sources.

According to Inc42 sources, most of the layoffs happened from the short video platform, Josh. The layoffs at VerSe come just a few months after it raised $805 Mn at a valuation of $5 Bn in April this year. Incidentally, the startup did not share details of the benefits the outgoing employees would receive.

The startup’s expenses surged 2.35X to INR 3,714 Cr in FY22 from INR 1,580 Cr in FY21, while revenue from operations increased only about 45% to INR 965 Cr in FY22.

November 19 | Zomato Fires At Least 100 Employees In Performance-Related Layoffs

Listed foodtech startup Zomato became the first in its segment to fire employees amid a global economic downturn, laying off 3-4% of its workforce. In response to Inc42’s queries, a Zomato spokesperson said, “There has been a regular performance-based churn of under 3% of our workforce; there’s nothing more to it.”

Over the last few weeks, Zomato has seen several high-profile exits, including cofounder Mohit Gupta. Further, Kuwait-based startup Talabat, who bought Zomato’s UAE food delivery business in 2019, shut down Zomato’s food delivery business there.

The foodtech unicorn narrowed its loss to INR 250.8 Cr in Q2 FY23 YoY.

November 9 | B2B Insurtech Plum Fires 10% Employees Citing Restructuring

Tiger Global-backed B2B insurtech player Plum fired 10% of its workforce, or about 36 employees, as part of a cost-cutting exercise. The startup said it conducted multiple cost-cutting measures before going for layoffs.

Plum’s CEO and founder Abhishek Poddar added that the impacted employees will receive severance pay, healthcare benefits, well-being counselling, ESOP vesting and placement and career support.

Notably, the layoffs came after Poddar had said Plum would increase its employee count to 1,000 by FY23. The startup’s last funding round was its Series A round worth $15.6 Mn, which saw Tiger Global participate. In all, the startup has raised $20.6 Mn.

November 7 | Unacademy Goes For Third Layoff Round, Fires 10% Employees

Edtech unicorn Unacadamy conducted its third round of layoffs citing “unprecedented times”, as communicated to the employees in an internal email. The third round of layoffs impacted 10% of its workforce, taking the total number of employees fired by Unacademy to 1500 for the year.

The layoffs come after the edtech major had said it would not conduct further layoffs during the earlier round. However, Unacademy’s losses almost doubled year-on-year (YoY) to INR 2,848 Cr in FY22. At the same time, the startup reported consolidated revenue of INR 719 Cr in FY22.

Unacademy said that the affected employees will receive severance pay equivalent to the notice period and an additional two months. Munjal also said that the affected employees will get medical insurance coverage for an additional year and a supposed ‘dedicated’ placement support.

November 7 | Edtech Startup Practically Lays Off Employees, Cuts Down Headcount By 190 In Three Months

Hyderabad-based K-12 STEM edtech startup Practically conducted a layoff in November, firing an unconfirmed number of employees. The edtech startup has gradually reduced its headcount by 190 employees since August 2022, according to Practically’s COO and cofounder Charu Noheria.

The layoffs at Practically come a year and a half after it raised $4 Mn in January 2021, after which it could not secure funding, resulting in the layoffs. Noheria told Inc42 that Practically’s last funding round worth $5 Mn could not materialise as investors backed out. The COO noted that the current investors have helped stabilise the startup.

November 4 | B2B Ecommerce Unicorn Udaan Fires 350 In Second Layoffs This Year

B2B ecommerce unicorn Udaan fired 350 employees, stating its move to turn profitable and “achieve efficiency”. The move comes less than five months after the ecommerce unicorn fired 180 people to cut costs, which Inc42 exclusively reported.

“As we move forward in our journey towards making Udaan a profitable company, the efficiency enhancement drive and the evolution in business model has created some redundancies in the system, with some roles no longer required,” an Udaan spokesperson told Inc42.

The layoffs at Udaan happened a week after it raised $120 Mn in debt, having raised $250 Mn in debt in January this year as well.

November 2 | SaaS Unicorn Chargebee Lays Off 10% Employees Citing Macroeconomic Conditions

Chennai-based SaaS unicorn Chargebee fired 10% of its staff citing macroeconomic conditions and a need to cut costs going forward. The development was confirmed in a LinkedIn post shared by the cofounder Kris Subramanian. The move impacted 142 employees across departments.

Chargebee said that the employees impacted will receive three months’ pay, three months of extended medical benefits and outplacement service. “This difficult decision was driven by external market forces as well as our need to address the operational debt we have accumulated in the last few years,” said Subramanian.

The layoffs come nine months after Chargebee raised $250 Mn in a funding round and nine months after it acquired collections management platform numberz.

October 12 | FrontRow Fires 125-130 Employees, Takes Layoff Total To 275

After having laid off 145 employees in May, edtech startup FrontRow laid off another 125-130 employees. With the latest layoffs, the edtech startup has laid off as much as 85% of its total workforce in less than six months.

FrontRow founder Ishaan Preet Singh said, “Unfortunately, as we realized that a sales and marketing-led approach to this market didn’t work with our current delivery model, we had to let go a large part of our team.” Singh added that the laid-off employees would receive a month’s salary as severance.

The layoffs come almost a year after the startup raised $14 Mn in its Series A funding round. FrontRow is backed by Deepika Padukone’s Family Office, Vishal Dadlani, rapper Raftaar, CRED’s Kunal Shah, Unacademy’s Gaurav Munjal and ShareChat’s Farid Ahsan.

October 12 | BYJU’S Lays Off 2,500 Employees After Notching Up INR 4,588 Cr In Losses

India’s most valuable startup BYJU’S laid off 2,500 employees from its workforce, citing its push to achieve profitability by the end of FY23. The decacorn laid off employees across product, content, media, and technology teams.

The edtech giant has also restructured its business, consolidating its K-10 acquired businesses such as Toppr, Meritnation, TutorVista, HashLearn, and Scholar into one unit, while Great Learning and Aakash would operate independently.

The move comes seven months after BYJU’S announced raising $800 Mn in a funding round and just weeks after it published its financial report for FY21. The edtech major clocked up INR 4,588 Cr in losses, almost 20X higher compared to FY20.

October 3 | WazirX Lays Off 60+ Employees Amid Crypto Winter

Indian cryptocurrency exchange WazirX laid off around 40% of its workforce, or at least 60 people, citing adverse economic conditions. The startup laid off across customer support, HR and other teams. WazirX has also relieved the entire public policy and communication team of its duties.

The laid-off employees would receive severance pay for 45 days and would not be required to report for work effective immediately. The reduced trade volumes across crypto exchanges in India prompted the startup to conduct layoffs.

The layoffs came when WazirX is facing heat from Indian authorities such as the ED on allegations of money laundering and tax evasion. Further, it was recently embroiled in a public spat with Binance after the Chinese crypto exchange denied acquiring WazirX.

September 19 | Dukaan Lays Off 23 Employees Citing Restructuring And Automation

Dukaan tech startup Dukaan laid off 23 employees citing restructuring and automation. Cofounder and CEO Suumit Shah announced the layoffs in a Twitter thread on September 19. Dukaan laid off employees in live chat support, call support and on the tech front after those processes were automated.

“Since we shifted our whole focus from the small kirana/SMB segment to enterprises/D2C brands, there wasn’t much of a role for live chat support or call support, and on the tech front, we automated a lot of stuff,” said the cofounder in a tweet.

The move comes more than a year after Dukaan raised $11 Mn in Series A; the enterprisetech startup has raised $17 Mn in funding so far.

September 19 | Ola Lays Off 200 Software Engineers As Part Of Its Restructuring Plan

Mobility giant Ola laid off 200 software engineers as part of its mega restructuring plan in a bid to centralise its operations and reduce redundancies. The startup had over 2,000 engineering roles across verticals, with 10% of them let go during the layoffs.

The unicorn has also hinted at hiring 3,000 more engineers in the coming months as part of its restructuring plan. The layoffs come after unconfirmed reports suggested the unicorn laid off as many as 2,100 off-role employees a few months ago.

Over the past few months, Ola has shut down various verticals in a bid to streamline its operations, including the used cars marketplace Ola Cars, the quick commerce vertical Ola Dash and its car-leasing service to drivers on Ola.

September 16 | Inc42 Exclusive: Clear Lays Off Around 200 Employees Citing Restructuring

SaaS startup Clear (formerly Cleartax) laid off 190-200 employees or about 20% of its total workforce. The startup cited restructuring to extend the runway as a reason for conducting layoffs across teams. According to Inc42 sources, the number of employees laid off could get higher.

The layoffs come after Clear made two acquisitions this year, compliance application CimplyFive and supply chain financing application Xpedize. The startup’s last funding round saw it raise $75 Mn in October 2021.

Clear reported a loss after tax of INR 118 Cr in FY21, 24% higher from INR 95 Cr in FY20. The startup reported an increase in both total income and total expenses during the said fiscal year.

September 7 | Inc42 Exclusive: Rupeek Lays Off 50 More Employees, Takes Total Count To 230

After laying off 180 employees exactly three months ago, fintech startup Rupeek laid off another 50 employees. The number let go amounted to around 5% of Rupeek’s workforce, said a spokesperson. The latest layoffs take the total number to 230, or around 20% of the startup’s original workforce.

Incidentally, these pink slips were issued just a day after Inc42 exclusively reported that Rupeek is in talks with investors to raise $16 Mn. So far, the fintech startup has raised $134 Mn, with its latest funding round back in January 2022.

Rupeek reported a loss of INR 156 Cr in FY21, down 68% from INR 487 Cr in FY20. At the same time, its total revenue grew to INR 88.5 Cr from INR 31.9 Cr in FY20.

September 1 | Inc42 Exclusive: Healthtech Unicorn Innovaccer Lays Off 120 Employees Amid ‘Adverse Economic Conditions’

Healthtech unicorn Innovaccer laid off 120 employees citing ‘adverse economic conditions’, with most of the employees being from the tech team. Many team managers have also been laid off, resulting in multiple projects shutting down.

According to Inc42 sources, Innovaccer offered a three-month salary as a severance package to the impacted employees. Innovaccer cofounder and CEO Abhinav Shashank confirmed the layoffs to Inc42.

The layoffs come nine months after Innovaccer doubled its valuation to $3.3 Bn after raising $150 Mn. In all, the healthtech unicorn has raised $375 Mn over its lifetime.

August 31 | Inc42 Exclusive: Microblogging Site Koo Lays Off Over 5% Workforce

Koo, the microblogging site being touted as India’s answer to Twitter, laid off 5% workforce. Most of the employees that were laid off were from the operations and backend teams.

The social media startup last raised funds in February 2022, when a dozen investors pumped $10 Mn into the startup. In all, Koo has raised $44.5 Mn so far.

August 25 | Meesho Shuts Down Meesho Superstore Operations In 90% Cities, Lays Off 300+ Employees

Ecommerce unicorn Meesho shut down the majority of its Superstore business, according to Inc42 sources. This has resulted in around 300 people being laid off as Meesho rolled back Superstore to only two cities, after expanding to six states in a short amount of time.

Sources told Inc42 that Meesho offered two months of salary as a severance package to the employees. It has also absorbed some of the on-roll employees in its core business. According to Inc42 sources, low revenue and high cash burn prompted the ecommerce unicorn to roll back its e-grocery service.

The layoffs come after Meesho raised a whopping $570 Mn in 2021 alone, having raised $1.1 Bn since it was founded in 2015.

August 5 | Edtech LEAD Lays Off Around 100 People After Performance Appraisal

Edtech unicorn LEAD has laid off around 100 employees as part of a performance appraisal process. The employees that were laid off belonged to multiple departments at the edtech unicorn.

A LEAD spokesperson said that performance appraisals happen each year and cited the layoffs as part of the same process. While media reports seemed to suggest a number of around 100, LEAD stated that the number is less than 100, without sharing the exact number of employees let go.

The layoffs come almost eight months after LEAD became a unicorn after raising $100 Mn in a funding round.

August 2 | Vedantu Takes Its Layoff Tally To Over 724 Employees; Conducts Third Layoff Citing Restructuring

Edtech startup Vedantu laid off a combined 724 employees across three layoffs, giving internal restructuring as the primary reason. Incidentally, Vedantu got the unicorn tag last year after raising $100 Mn in funding. 

The edtech’s first layoff came on May 5, when Inc42 exclusively reported that the edtech startup laid off 200 employees. The edtech startup said that it will be hiring around 1,000 people in the coming months. However, Vedantu conducted another layoff on May 17, this time firing 424 employees.

The third layoff came on August 2; Inc42 exclusively reported that Vendantu laid off more than 100 of its employees citing restructuring. The edtech asked the employees to put in their papers between July 4 and July 9 this year.

July 20 | Inc42 Exclusive: BlueStacks Lays Off 60 Indian Employees Citing Restructuring

Android emulator platform BlueStacks laid off 60 of its Indian employees as part of a restructuring exercise within the company. The layoffs impacted employees in various departments in BlueStacks’ Delhi office.

Hue Harguindeguy, CHRO, BlueStacks confirmed the developments to Inc42, stating that owing to macroeconomic changes, the startup had to realign. Harguindeguy added that the startup is helping the employees that were let go find new jobs.

BlueStacks has offered a one-month salary as severance pay to the laid-off employees which also includes medical benefits, per Inc42 sources.

July 12 | Event Tech Startup Hubilo Lays Off 12% Employees Citing Restructuring

Event tech startup Hubilo laid off 12% of its workforce, or around 45-50 employees after it stated that it will shift its focus to live and hybrid events. The Bengaluru and San Francisco-based has laid off employees across several departments.

A Hubilo spokesperson told Inc42 that the layoffs are a strategy to boost business. “On July 7th, Hubilo let go of approximately 12% of its workforce to pursue a strategy that will allow it to lay the foundation for the future of virtual, live, and hybrid events. We greatly value the contributions of all our team members,” the spokesperson said. Hubilo claimed that it has offered compensation packages and benefits, including stock options, bonuses, laptop retention, and job placement assistance to laid-off employees.

The layoffs come nine months after the startup had raised $125 Mn in a funding round.

July 12 | Inc42 Exclusive: Fresh Fruit & Vegetable Delivery Startup Fraazo Lays Off Over 150 Employees

Mumbai-based fresh fruit and vegetable delivery startup Fraazo has laid off more than 150 employees amid a cash crunch, winding down operations in Delhi NCR entirely and shutting down 50 dark stores across the country in the process. The layoffs took place across operations, tech, product, procurement, HR store managers, and planning and growth teams, among others, to cut expenses amidst a fund crunch.

Inc42 sources also noted that the number would be much higher if we include off-role employees such as delivery drivers. The employees that will leave the startup will receive a month’s salary as a severance package, mostly based on notice periods of the said employees.

The layoffs come nine months after the startup raised $50 Mn in a Series B funding round. Fraazo is shutting down more dark stores in Bengaluru and Hyderabad, which will result in more layoffs, particularly for the off-role employees.

June 30 | Inc42 Exclusive: Edtech Startup Crejo.Fun Shuts Down, Leaving 170 Employees Without A Job

Bengaluru-based edtech startup Crejo.Fun became the second edtech startup to shut down in June alone after Udayy, after failing to raise funding and schools reopening. The company claims to have refunded all of the customers, while it works to sell the IP to return some capital to the investors.

The company had raised $3 Mn in pre-seed funding last year from Matrix Partners India and Flipkart cofounder Binny Bansal-backed venture capital firm 021 Capital. However, it had been more than 14 months since then and Crejo.Fun was under pressure to raise fresh funding. The company’s 170-strong workforce will receive salary for July and the company claims that almost 90% of the same have been placed elsewhere. 

Cofounder Vikas Bansal confirmed the development with Inc42, saying in a written statement that even though the company grew well even with schools reopening, it has decided to shut down operations. “However we were running out of funds and while we were trying to raise capital for the last couple of months, but given the fundraising environment, we were unable to raise funds,” Bansal added.

June 29 | Inc42 Exclusive: EV Mobility Startup Oye Rickshaw Lays Off 40 Employees

Gurugram-based EV mobility startup Oye Rickshaw laid off 40 employees amid increasing losses and declining business, becoming the first in its industry to do so. Employees from tech, sales, marketing and several on-ground executives have been laid off by the startup citing adverse market conditions.

Mohit Sharma, cofounder and CEO of Oye Rickshaw, in a statement, said, “As we head towards a market downturn, we have had to make some difficult decisions to ensure the company continues to stay stable and achieve our mission of redefining India’s EV ecosystem.” Sharma said that when market improves in the future, the startup would look to get some of the laid-off employees back on board.

After having raised INR 24 Cr in a debt round last year, Inc42 was also informed that Oye Rickshaw is raising another INR 40 Cr in debt for day-to-day operations and to buy more batteries for its battery-swapping business.

June 29 | BYJU’S-owned Toppr Lays Off 350+ Citing Restructuring

In another layoff at a BYJU’s-owned edtech company, Toppr has laid off around 350 employees citing company restructuring. Most of the impacted employees were subject matter experts, content developers, managers and heads of departments for various subjects, among others, according to Inc42 sources.

According to an email sent to laid-off employees accessed by Inc42, the company said that it conducted a restructuring and that left multiple roles redundant. Toppr will provide severance payment equivalent to the notice period of the laid-off employees, along with a package including 15 days’ salary for each year completed and prorata performance bonus (if applicable) till June 30.

A BYJU’s spokesperson told Inc42 that it has absorbed 80% of Toppr’s workforce, after having bought the edtech startup for $150 Mn last year. In FY21, Toppr incurred a loss of INR 125.9 Cr. It generated INR 52 Cr in revenue, of which INR 50.6 Cr came from operations. Its expense stood at INR 178 Cr during the same time.

June 28 | Nova Benefits Lays Off 70 Employees Citing Restructuring, Takes Total Layoffs To 80

Bengaluru-based employees wellness platform Nova Benefits has laid off 70 employees as a result of restructuring. Earlier this month, the startup had laid off 10 employees, and the current layoffs take the total employees impacted to 80, or about 40% of its total workforce. The employees were laid off from sales, accounts, marketing and creative teams, among others.

“We owe everyone at Nova a challenging, fast-paced growth path. However, in the face of our redefined business strategy, we cannot provide this to 30% of our teammates,” a mass mail accessed by Inc42 read. The startup also cited cost-cutting as a reason to lay people off and conduct a business restructuring.

The layoffs come four months after it raised an undisclosed amount from Naval Ravikant-backed AngelList Early-Stage Quant Fund. In September, last year, the startup had raised $10 Mn in its Series A which Inc42 had exclusively reported. The round back then was led by Susquehanna International Group (SIG) and Bessemer Venture Partners.

June 28 | Inc42 Exclusive: BYJU’s-owned WhiteHat Jr Lays Off 300 Citing Cost Cutting

After forcing around 1,000 employees to resign as it called them to work from office, BYJU’s-owned WhiteHat Jr has laid off around 300 employees to cut costs. The sales, marketing and operations teams were the affected teams, with the first two being the worst affected.

According to Inc42 sources, the management has cited business restructuring as the reason behind the layoffs. Another source informed Inc42 that the WhiteHat Jr is in process of firing more people, and the number of employees impacted could double to reach 600 by the end of it. The company is said to have run out of operating capital, and is set to be completely absorbed by BYJU’s, a person said on condition of anonymity.

WhiteHat Jr has been posting staggering losses. In FY21, the edtech startup recorded INR 1,690.4 Cr in losses. During the same fiscal, it spent INR 2,175.2 Cr to earn INR 483.9 Cr.

June 27 | Inc42 Exclusive: Ecommerce Platform Udaan Lays Off 180 Citing Cost Cutting

B2B ecommerce platform Udaan became the eighth ecommerce startup to lay employees off in 2022, laying off 180 employees citing cost-cutting. While the layoffs do not amount to a significant percentage of its employees, Inc42 sources said that there are more layoffs to come. The number of employees affected can reach as high as 600, sources said.

Udaan has conducted the layoffs mere months after it raised $250 Mn in a round from big-name investors such as Microsoft, M&G Prudential, Kaiser Permanente, Nomura, TOR and others. In a statement given to Inc42, Udaan said that it will support outgoing employees. Udaan has said that it will provide medical insurance, a compensation package and outplacement assistance.

Udaan generated INR 5,919 Cr in revenues at an expense of INR 8,742 Cr in FY21. The startup narrowed its loss to INR 2,482.3 Cr in FY21 from INR 2,518.7 Cr in FY20. According to an internal mail sent a week before the layoff, the CEO Vaibhav Gupta had said that Udaan was en route to hit positive unit economics by the end of the June quarter. However, the startup still cited unit economics as a reason to lay people off.

June 20 | Inc42 Exclusive: Sequoia Surge-backed Aqgromalin Lays Off 80 After Investors Back Out

Chennai-based Animal husbandry and aquaculture startup Aqgromalin laid off 80 full-time employees from its corporate offices as a funding round did not materialise. The layoffs account for 30% of the startup’s total workforce and have impacted marketing, sales and support, among other teams.

The funding round was supposed to be led by a Korean fund, which pulled out on the day of signing the deal. The layoffs came almost five months after Aqgromalin raised $5.25 Mn in a pre-Series A round from the likes of Sequoia India’s Surge, Omnivore Partners and Zephyr Peacock India.

The layoffs have also likely prompted a pivot in the startup’s business, as Inc42 sources told that Aqgromalin might look to move away from animal husbandry and focus only on its aquaculture business. The Chennai-based startup is also in talks for a potential merger, with Licious coming up as a potential candidate.

June 18 | Social Commerce Startup CityMall Lays Off 191 Employees Citing Restructuring

Gurugram-based social commerce startup CityMall has laid off 191 employees, both on-roll and off-roll, across multiple positions citing restructuring. The move comes three months after the startup had raised $75 Mn in its Series C round of funding.

The startup has shuttered its operations in Noida and is likely to do the same at the warehouse in Jaipur, according to Inc42 sources. The startup has also closed two dark stores for one-day delivery in Rohtak and Gurugram.

CityMall recorded a loss of INR 15.18 Cr in FY21, having spent INR 28.9 Cr to make INR 15.18 Cr. A CityMall spokesperson, confirming the development, told Inc42 that the startup will provide outgoing employees with outplacement assistance to find jobs at other places.

June 17 | Inc42 Exclusive: Unacademy Lays Off 150 Employees, Takes Total Layoffs To 1,150

It has been a difficult few months to be an edtech employee, and this is far more evident at Unacademy than anywhere else.

The edtech unicorn has conducted four separate layoffs citing cost-cutting, performance reviews, restructuring and whatnot, as it pivots to offline and perhaps more interestingly, into SaaS with Cohesive, all in a bid to achieve profitability.

In late March, Inc42 first reported that in a cost-cutting exercise, the edtech startup had laid off more than 125 consultants from its PrepLadder team. PrepLadder, which was acquired by Unacademy in July 2020 for $50 Mn, gives students material for competitive exams such as IIT/JEE, NEET and so on.

Days later, Unacademy laid off more than 200 teachers in a cost restructuring exercise. Inc42 exclusively reported that the edtech unicorn fired the educators based on their poor performance. In early April, the startup laid teachers off again, this time firing 600 teachers. The layoffs, according to a company spokesperson, were based on several assessments to determine the performance.

The latest layoff has seen Unacademy lay off 150 more employees, mostly from its sales and operations verticals. According to Inc42 sources, the impacted employees are from Unacademy Group’s core business, Unacademy, and PrepLadder.

June 16 | Inc42 Exclusive: IPO-Bound PharmEasy Lays Off 40 Employees From Subsidiary Docon Technologies 

PharmEasy’s parent company, API Holdings has laid off 40 employees from its subsidiary Docon Technologies, an EMR or electronic medical record solutions provider. Docon has seen layoffs mostly across the sales background, such as business development managers, cluster heads and area managers.

Docon has been taken apart and incorporated into PharmEasy by API Holdings, forming PharmEasy One. According to Inc42 sources, many of the employees had resigned following the restructuring, and the remaining 40 employees were the ones that were laid off from the Docon team.

Docon Technologies made a loss of INR 29.7 Cr in FY21 against a total income of INR 2.25 Cr. Currently, it has stopped all on-ground operations and is working virtually.

June 14 | Inc42 Exclusive: Breathe Well-being Lays Off 50 To Cut Costs

Gurugram-based healthtech startup Breathe Well-being laid off around 50 employees or around 30% of its total workforce over the last few weeks in a bid to cut costs and extend its runway. The sales, operations, tech, and talent acquisitions, among others, are the teams that were impacted by the layoffs.

Per Inc42 sources, the startup had been aggressively hiring until April, looking to raise fresh funding. However, in failing to do so, it has not only laid off existing employees but also rescinded offer letters from employees that were supposed to join soon.

As per FY21, the startup had incurred a total loss of INR 2.27 Cr, while generating sales worth INR 39.2 Lakh, registering expenses of INR 2.66 Cr. The company had last raised $5.5 Mn in a funding round last August.

June 10 | Inc42 Exclusive: Logistics SaaS Startup FarEye Lays Off 250 Employees Citing Restructuring

New Delhi-based logistics SaaS startup FarEye has laid off 250 employees this week, impacting employees across offices in India, North America and Europe. FarEye has laid off across its product & engineering, professional services, talent acquisition, quality analysts, sales and developers teams, among others.

According to founder and CEO Kushal Nahata, the layoffs have happened because of a shift in focus of the startup and internal restructuring. He said that the laid-off employees will receive “rightful benefits and entitlements”, though employees that talked with Inc42 blame extensive hiring for the layoffs.

Notably, the layoffs come slightly over a year after FarEye raised $100 Mn in a Series E round. The startup has raised $150 Mn so far. FarEye recorded losses of INR 62 Cr on a standalone basis in FY21, having incurred an expenditure of INR 142.2 Cr during the same period.

June 9 | Inc42 Exclusive: Edtech Startup Yellow Class Lays Off 19 Employees

Elevation Capital-backed edtech startup Yellow Class has let go of around 19 employees in recent weeks. The startup had informed its team about the layoffs on May 19, as per Inc42 sources.

While Inc42 sources hinted that a lack of funds is the reason behind the layoffs, founder Anshul Garg denied any such claims. He agreed on the layoff count but said the layoffs were part of restructuring as Yellow Class has chosen to focus deeply on fewer initiatives. The startup had a total workforce ranging from 120 to 130 on its payroll.

The layoffs have come almost 10 months after Yellow Class raised $6 Mn in its Series A round led by Elevation Capital along with a clutch of angel investors including Vidit Aatrey, and Dhruv Agarwala.

June 7 | Sequoia-Backed Gold Loans Startup Rupeek Lays Off 200 People To Cut Costs

The Bengaluru-based gold loans provider Rupeek laid off 200 people in a bid to cut costs. The laid-off workforce represents 10-15% of Rupeek’s total workforce, a company spokesman said, adding that the startup will support the outgoing employees without sharing any details.

Rupeek’s layoffs came five months after it had raised $34 Mn in January 2022, valuing the startup at over $600 Mn. So far, the fintech soonicorn has raised $134 Mn in venture capital funding.

Incidentally, the startup reported a net loss of INR 156.5 Cr in FY21, having incurred a total expense of INR 245 Cr. The startup reported a net income of INR 88.5 Cr in FY21.

June 4 | SoftBank-Backed Edtech Startup Eruditus Lays Off 40 Employees After Resizing Expansion Plans

Mumbai-based edtech unicorn Eruditus laid off 40 employees from its workforce. The company has rolled back its expansion plans to around 100-150 hirings this year, eliminating the need for a large talent acquisition team.

“So that team (talent acquisition), unfortunately, has been affected. And yes, we have downsized that team because we don’t need the same set of people,” Eruditus cofounder and CEO Ashwin Damera said.

According to Damera, Eruditus scaled down its expansion plans to achieve profitability in the near term, saying that the startup’s India business is already profitable.

June 2 | Inc42 Exclusive: Info Edge-Backed Yojak Fires 140 Employees, Shuts Domestic Operations

Gurugram-based construction-focused ecommerce startup Yojak laid off 140 employees in April and May. Yojak is also shutting down its domestic operations and will now focus on Yojak Exports to export construction materials and equipment.

The startup, backed by Info Edge, ran out of funds to operate its domestic operations, sources claimed. Out of the 140 employees it has asked to leave, 60 were full-time, while 80 were contractual hirings. Yojak founder Rachit Garg further told Inc42 that the startup has laid off many third-party workers, without sharing any numbers for the same.

Yojak’s employee benefits expenses increased by 40-50% since January 2022 owing to its aggressive hiring, which saw its runway shrink significantly.

June 1 | Edtech Startup Udayy Shuts Down, Leaves 100 Employees Jobless

Gurugram-based edtech startup Udayy said that it will be shutting down operations, three years after it was founded by Saumya Yadav in 2019. This has left 100 people that it employed without a job.

At the time of the shutdown, the edtech claimed to have users across 45 cities, with 400 classes a day being operated. Udayy had last raised $2.5 Mn in January last year in a seed funding round, backed by the likes of Alpha Wave Global and InfoEdge Ventures. In all, the early stage startup had raised $13.5 Mn of institutional capital.

Udayy’s founder and CEO told Inc42 that it has given severances to its employees and contractural teachers. After winding up operations, Udayy will also return $8.5 Mn to some investors.

May 31 | Inc42 Exclusive: Indiabulls’ Social Commerce Venture Yaari Lays off 150 Employees

The social commerce platform Yaari, a venture of Indiabulls, asked almost 150 employees to submit their resignations in the last week of April. The impacted employees, from the supply support, customer support, business development and marketing teams, account for 60% of its total workforce.

Yaari looked to compete with the likes of Meesho and Trell, but it was underfunded by several orders of magnitude as compared to the two unicorns. According to several employees Inc42 talked with, the company was not doing well. Even so, the employees were reassured of their jobs.

In the aftermath of the layoffs, Yaari’s tech team has been absorbed by Dhani.com, another Indiabulls-backed ecommerce venture. Yaari itself will be merged with Dhani.com as well.

May 30 | MPL Lays Off 100 Employees, Exits Indonesia, Shuts Down Streaming

Mobile Premier League (MPL), the fantasy gaming unicorn, laid off 100 people from multiple teams. The layoff has impacted about 10% of its total workforce as the unicorn exits Indonesia and shuts down its streaming service.

In an email to employees, MPL cofounders Sai Srinivas and Shubh Malhotra said, “It is time to make the difficult decision to redeploy our resources in other parts of our business to ensure our long-term health and success as a company.”

The unicorn had last raised $150 Mn in funding in September 2021, becoming one of India’s 100 unicorns at that point. The layoffs come eight months after the said fundraise.

May 27 | Inc42 Exclusive: FrontRow Lays Off 145 Employees To Cut Costs

Extracurricular edtech startup FrontRow laid off 145 employees across sales, quality control and HR teams. The layoff, impacting almost a third of the startup’s total employees, has been done to cut costs and increase the startup’s runway. According to Inc42 sources, the sales team alone saw 100 people fired.

FrontRow founder Ishaan Preet Singh told Inc42 that the decision was taken to ensure that the startup has over 24 months of runway. “This included letting go of ~30% of our team, primarily in sales, to make sure that we come out of this market stronger,” he added.

FrontRow laid off employees eight months after it raised $14 Mn in a Series A funding round, having raised $17 Mn in funding overall, having the backing of the likes of Deepika Padukone, and several other angel investors.

May 24 | Invact Metaversity Crashes; Lays Off 66% Of Workforce

Invact Metaversity, founded by ex-Twitter India head Manish Maheshwari, started as a promising edtech startup, offering a 16-week MBA alternative for around INR 2 Lakh. The first course was supposed to start on May 12.

However, even before anything like that, the Metaversity is all but closed up, having laid off 20 out of the 30 employees that were working from the Bengaluru office. Maheshwari had announced his plans in December 2021 and the startup had raised more than $5 Mn from some of India’s biggest angel investors.

Even so, Metaversity’s fall from grace has come as little surprise, as the founders struggled to find the right product and the right approach. The startup lacked a shared vision among the leadership.

Last evening, Metaversity said that Maheshwari has stepped down from his position as CEO.

May 21 | Inc42 Exclusive: MFine Lays Off 600 Employees Prompting Protests

In what proved to be another example of apathy of a startup, healthtech startup MFine fired almost 75% of its workforce citing financial difficulties.

However, the writing was already on the wall for MFine. The company had reported a loss after tax worth INR 102.7 Cr in FY21, as it spent INR 116 Cr to make INR 12.9 Cr. According to an ex-employee, MFine had already been firing people in small batches since October 2021.

Entire teams were laid off in the process, which triggered protests against the startup as 100 former employees gathered outside MFine’s Bengaluru office. The protestors demanded the rollout of the full May salary along with an early release of their full & final payment.

However, not only did MFine not let Inc42 enter the office, it did not allow female ex-employees, which included a pregnant woman, to use the restroom.

May 19 | Inc42 Exclusive: Cars24 Lays Off 600 Citing Automation, Cost Cutting

Used car unicorn Cars24 also joined the list of startups that have laid employees off. Mostly laying off across lower divisions, Cars24 cited automating operations and cutting costs as the two reasons for laying off 7% of its total workforce.

On the other hand, the unicorn has raised $950 Mn across its lifetime. These layoffs come five months after it raised $400 Mn at a valuation of $3.3 Bn. Speaking on the layoffs, a Cars24 spokesperson told Inc42, “This is business as usual – performance-linked exits that happen every year.”

The startup is looking for an IPO over the next 18-24 months, joining the list of Indian startups that are waiting for the storm to pass to go for a public listing.

May 17 | Vedantu Lays Off 624 Employees In 15 Days Citing Restructuring

Edtech startup Vedantu laid off a combined 624 employees across two layoffs within a span of 15 days, citing cost restructuring as the primary reason.

First, Inc42 exclusively reported that the edtech startup laid off 200 employees. The edtech startup said that it will be hiring around 1,000 people in the coming months. However, two weeks in, Vedantu conducted another layoff, this time firing 424 employees.

The startup has conducted the layoffs after it achieved the unicorn tag last year after raising $100 Mn in funding. A blog post by CEO Vamsi Krishna showed that the startup will extend health benefits for laid-off employees and their families till August 5, 2022.

May 10 | Inc42 Exclusive: WhiteHat Jr Conducts ‘Soft’ Layoffs As 1,000 Employees Resign

In a strange and probably the first case of its kind, Indian startup WhiteHat Jr asked its remote employees to either join offices or hand in their resignations. Inc42 had exclusively reported the resignations of 800 employees, however, after publishing the story several employees reached out, claiming the number to be more than 1,000.

According to ex-employees, this was a layoff in disguise. Interestingly, Inc42 learnt that if an employee is based out of Gurugram, they were not allowed to join WhiteHat Jr’s Gurugram’s office, but the Bengaluru office for a similar job role.

The edtech startup’s soft layoffs have triggered the debate between working remotely and working from the office as more and more companies are asking their employees to join. However, WhiteHat Jr gave the employees no choice at all.

April 21 | Ola Restructures Quick Commerce Business; Lays Off 2,100 Dark Store Workers

After going bullish on quick commerce twice before, Bhavish Aggarwal-led Ola’s quick commerce arm Ola Dash went for restructuring its entire business, which resulted in the unicorn laying off around 2,100 dark store workers. Ola ended the contracts of these workers who were hired to man its 200 dark stores.

In terms of its dark stores, Ola has reportedly scaled down half of them and may even shut a few of them down. The unicorn had run into regulator challenges with bringing in its $500 Mn term loan from foreign lenders and that had prompted the scale back.

However, doing a 180 recently, Ola has announced that it will go for quick commerce again, scaling down its food delivery operations this time around. This means that laying off those 2,100 people meant nothing, as the company tries hard to pivot away from its core business of cab aggregation.

April 11 | Layoffs At Meesho: 150 Employees Fired Citing Restructuring

The ecommerce unicorn Meesho laid off 150 employees, saying that it is restructuring Meesho Superstore which has impacted the said number of employees.

Meesho said, “As we look to boost efficiencies in the light of the integration, a small number of full-time roles and certain third-party positions on six-month contracts at Meesho Superstore were reassessed to remove redundancies with the core business.”

The layoffs happened less than seven months after the unicorn raised $570 Mn in funding. The ecommerce and social commerce unicorn tried its hands at grocery delivery with a pilot project in Karnataka less than nine months ago. It had plans to expand to Tier 2+ cities, but it has had to scale back following limited success.

March 26 | Furlenco Lays Off 180 Employees To Cut Costs

Furniture startup Furlenco laid off around 180 employees to cut costs and achieve profitability ahead of a public offering, according to several employees Inc42 spoke to.

Around 95% of the employees let go were in customer-facing roles which include customer support and other similar roles. The startup claims to have extended medical coverage for the impacted employees, which constitute almost a third of the startup’s total workforce.

The layoffs come as the company had raised $165 Mn in funding last year alone, including a $24 Mn funding round in February 2022 itself.

March 14 | Trell Lays Off Half Of Its Workforce To Extend Runway, Cut Costs

Bengaluru-based social commerce platform Trell laid off 300 employees after the company’s founders were alleged of financial irregularities and the company saw its $100 Mn funding round fall through.

Amid the boardroom tussle, which saw the company’s investors order an investigation against the founders and the founders hitting back, the company’s employees suffered.

The layoffs were cited to be an exercise to cut costs and extend its runway as Trell looked to survive. The company incurred a loss of 78.4 Cr in FY21. This is an almost 550% increase from INR 12.07 Cr that it had incurred in FY20.

March 10 | Blinkit Lays Off Nearly 1,600 Employees After Splurging INR 600 Cr

Quick commerce startup Blinkit reportedly laid off employees across major cities including Mumbai, Hyderabad and Kolkata. The layoffs impacted close to 5% of Blinkit’s overall workforce, which amounts to around 1,600 people, including riders, pickers and store managers.

The layoffs came on the heels of Zomato investing $150 Mn in the cash-strapped company, which had also picked up a loan of $10 Mn from Innoven Capital.

Blinkit has had to cut back after reportedly splurging INR 600 Cr on expanding its business last year between November and February. The deep discounting tactics backfired and the startup cut costs and corners to reduce its cash burn by firing employees.

February 23 | OkCredit Lays Off 35% Of Workforce To Change Business Model

Bengaluru-based bookkeeping startup OkCredit laid off 40 employees or around 35% of its total workforce. Most of these layoffs were from the backend, tech and engineering teams.

The Tiger Global and Lightening-backed startup said that it is focusing on its fintech initiatives and strengthening its growth channels, which has resulted in the startup laying off the said employees. OkCredit said that the laid off employees were being supported by outplacement services and extended medical insurance.

In FY21, the startup spent INR 114.6 Cr, to earn a mere INR 3.79 Lakh in sales revenue, forming another possible reason for the layoffs.

February 21 | Lido Lays Off 150 Employees To Cut Costs

Edtech startup Lido’s founder Sahil Sheth, during a virtual town hall, told the company employees that they were in a financial crunch. Following this, the company asked 150+ employees to submit their resignation as it looked to raise funds or possible acquisition of Lido.

The company assured these employees that they would be paid the pending salaries for January 2022 and the 1st week of February 2022 within ’30 to 90 days’, but to date, their salaries are pending, which has prompted them to take the fight to social media.

Since its launch in 2019, Lido Learning has raised close to $24 Mn in funding. The layoff had come only six months after it raised $10 Mn from Ronnie Screwvala’s Unilazer Ventures.

This is a running article. We will add as new information comes in.

If you would like to report a layoff, pay cut etc. at a startup, write to us at editor@inc42.com.

Last updated on August 14, 2023, 20:00 IST.

The post Indian Startup Layoff Tracker: 34,780+ Employees Laid Off By 120+ Startups Since 2022 appeared first on Inc42 Media.