What Zomato’s IPO Means for Indian Tech Startups
The first Indian IPO of the year, which raised $1.25 billion for the company, could herald a new era of exits for Indian tech startups.
In the last few years, Indian tech companies have witnessed a historic boom, attracting foreign investors, registering unprecedented growth, and becoming unicorns in quick succession. In the first six months of 2021 alone, 14 startups each reached a valuation of at least $1 billion; six earned that feat in four days in April.
Many of these companies are also preparing to go public. On July 14, Zomato, the Indian restaurant discovery and food delivery company, launched its widely anticipated $1.25 billion initial public offering (IPO) on the Bombay Stock Exchange (BSE) — in the biggest IPO since Coal India Ltd.'s $3.4 billion offering in November 2010.
According to Pankaj Chaddah, Zomato’s co-founder who quit the company in 2018, the company’s IPO is foremost a “huge validation of the value” that the company has created. He isn’t wrong. In the last 12 years, Zomato, which counts Info Edge, Tiger Global, Sequoia Capital India, Alibaba’s Ant Financial, and Singapore-based Temasek as investors, has revolutionized how Indians consume food in the country and abroad. By 2019, Zomato was available in 24 countries, including the U.A.E and Portugal. And in India, the Zomato app is a constant fixture on smartphones (in 2019, the Zomato app had 11 million downloads every month). Today, 10.7 million customers order food on Zomato every month in India.