Top loss-making Unicorn startups in India

Anwesha Singha
02 Jul 2022
Top loss-making Unicorn startups in India

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To most businesses is all about making money that is making profits. Earlier businesses used to be pretty straightforward, the main goal of companies was to build something that would aid the target audience in some way otherwise why would someone buy the service in the first place.

It was like a loop starting with building a product, marketing it, then selling it, making profits or losses, if profit is made then the company would go ahead and expand the business and also maybe use the money to build more products that's how the loop works even today some part of it is still prevalent.

It was straightforward, dependable, and steady. But that's no longer how business works, at least this isn't for start-ups. We can now replace it with this.

Growth is no longer determined by profits or losses, but by how much money a start-up can raise from its investors.

Indian startups that went public on exchanges last year have had a mixed bag of quarterly results. While some have reduced their losses, others have reported a drop in profits for the fiscal quarter ending March 2022.

InAmidhe IPO frenzy, newly listed companies lost $231 million in the second quarter of FY22.

Even after being publicly traded, some of India's largest startups continue to lose money. Only five of the eleven newly listed Indian technology startups that went public in 2021 reported losses in their previous fiscal year.

Having taken advantage of the lower marginal costs in the tech industry, startup founders have not demonstrated the ability to create a scale that can lead to profitability in the year 2022.

So we can see that startups in India are facing a difficult period and setbacks as a subdued demand environment and a lack of funding are likely to put loss-making companies in a difficult position. Most publicly traded startups' valuations have dropped by more than half in the first five months of this year.


Founder(S): Deepinder Goyal

Headquarters: Delhi NCR, Delhi, India

Founding date: February 2008

Zomato's technology platform, which was launched in 2010, connects customers, restaurant partners, and delivery partners to meet their various needs. Customers use the Zomato platform to search for and discover restaurants, read and write customer reviews, view and upload photos, order food delivery, reserve a table, and make payments while dining out. 

Zomato, on the other hand also, provides restaurant partners with industry-specific marketing tools that allow them to engage and acquire customers into row their business while also providing a dependable and efficient last-mile delivery service. Zomato also operates Hyper pure, a one-stop procurement solution that provides high-quality ingredients and kitchen products to restaurant partners.

Zomato's loss increased to Rs 360 crore from Rs 134.2 crore at the same time last year. Revenue from operations was Rs 1,211.8 crore, up 75.01 percent from Rs 692.4 crore in the previous quarter.

In Q4FY22, the company said it launched services in over 300 new cities. It is now available in over 1,000 towns and cities throughout India.

The company's losses for the fiscal year 2022 were Rs 1222.5 crore, up from Rs 816.4 crore the previous year. Revenue increased from Rs 1993.8 crore to Rs 4192.4 crore.


Founder(S): Girish Mathrubootham, Shan Krishnasamy, Vijay Shankar

Headquarters: San Mateo, California, United States of America

Founding Date: Oct 2010

Freshworks is a SaaS startup that is disrupting traditional CRM, ITSM, Customer Support, and Marketing Automation with its complete customer engagement suite, Freshworks360. In 2018, the company surpassed $100 million (INR 782 crores) in annual recurring revenue and joined the prestigious unicorn club. Freshdesk, Freshservice, Freshsales, Freshcaller, Freshteam, Freshchat, Freshmarketer, and Freshrelease are among the company's products.

 Freshworks, a software-as-a-service (SaaS) unicorn, reported net losses of $56.4 million (INR 441 crores) in the fourth quarter of 2021, up from $3.6 million (INR 281 crores) in the fourth quarter of 2020.

The non-GAAP loss (excluding non-cash expenses) increased to $10.7 million (INR 83 crores) in Q4,2021 from $3.4 million (INR 26 crores) the previous year. Since its IPO in September of last year, the Nasdaq-listed SaaS company's stock has dropped 56%. Freshworks' stock price decline is being interpreted as part of a larger price correction trend in US tech share prices.

According to Freshworks' quarterly earnings report, the company's total revenues increased by 44% to $105.5 million (INR 821 crores). Freshworks expects total revenue for 2022 to be approximately $495 million (INR 3874 crores). For 2022, the non-GAAP loss is expected to be in the $56.5 million-$48.5 million range.


Founder(S): Vinay Sanghi

Headquarters: Mumbai, Maharashtra, India

Founding Date:2010

Cartrade is a leading automotive marketplace for new and used vehicle buyers and sellers. Cartrade, founded in 2010 in Mumbai, Maharashtra, offers its services throughout India through a strong network of over 4000 dealers.

Cartrade's features include used car price information, certified used cars, on-road dealer prices, and expert reviews, which enable buyers and sellers to select the most appropriate vehicles at the most affordable prices.

Cartrade Tech reported a net loss of Rs 25.67 crore in the quarter ended March 2022, compared to a net profit of Rs 13.25 crore in the previous quarter ended March 2021. In the quarter ended March 2022, sales increased 13.43 percent to Rs 93.14 crore, up from Rs 82.11 crore in the previous quarter ended March 2021.

For the fiscal year ended March 2022, the net loss was Rs 132.10 crore, compared to a net profit of Rs 92.50 crore in the previous fiscal year ended March 2021. Sales increased by 25.25 percent to Rs 312.72 crore in the fiscal year ended March 2022, compared to Rs 249.68 crore in the fiscal year ended March 2021.


Founder(S): Sahil Barua, Suraj Saharan, Kapil Bharati, Bhavesh Manglani, Mohit Tandon

Headquarters: Gurgaon, Haryana, India

Founding Date: May 2011

Gurugram-based Last-mile delivery, third-party and transit warehouse management, reverse logistics, payment collection, vendor-to-warehouse, and vendor-to-customer shipping, and other services are provided by Delhivery.

Delhivery is a third-party logistics service provider based in Gurugram. Last-mile delivery, third-party and transit warehousing, reverse logistics, payment collection, vendor-to-warehouse a, nd vendor-to-customer shipping, and other services are available. 

It currently operates in over 2,000 cities and provides a variety of supply chain services. It has over 10,000 direct customers, which include large and small eCommerce players, SMEs, and over 350 leading enterprises and brands.

Delhivery reported consolidated losses of Rs 119.8 crore for the fiscal fourth quarter, a slight increase from last year.

In the January-March period, revenue from operations was Rs 2,071.7 crore, up from Rs 1,002.6 crore the previous year. From Rs 1,031.7 crore to Rs 2,127 crore, total income more than doubled.

Losses decreased by 5.5 percent sequentially to Rs 119.8 crore from Rs 126.5 crore in the third quarter. Revenue from operations increased by 3% to Rs 1,995 crores.


Founder(S):Yashish Dahiya ,Alok Bansal,Tarun Mathur,Rahul Agarwal

Headquarters: Delhi, India

Founding date: June 2008

PolicyBazaar is a fintech startup and insurance aggregator that allows users to compare financial services from major insurance companies based on price, quality, and key benefits.

PolicyBazaar is a fintech startup that helps users compare financial services from major insurance companies based on price, quality, and key benefits. Its insurance comparison portal and mobile application provide information on products such as medical, term life, travel, and motor insurance, as well as low-cost ULIPs and other investment products, allowing consumers to compare and analyze financial products.

PB Fintech, which operates insurance marketplace PolicyBazaar and credit platform PaisaBazaar, reduced losses in the fiscal fourth quarter to 219.6 crores, down from 643.8 crores the previous year.

Total income increased to 591.16 crores in the fourth quarter of FY22, up from 290.08 crores in the same period the previous fiscal year (FY21).

PB Fintech NSE -0.86 percent cut losses almost 36 percent sequentially compared to the quarter ended December 31, when it reported total losses of around 298 crores.

Revenue increased by 32% year on year, from 400.84 crores in the third quarter.


Founder: Ritesh Agarwal

Headquarters: Delhi, India

Founding Date: Feb 2013

OYO Rooms founded by Ritesh Agarwal in the year 2013 gives access to hotels and homes to businesses and entrepreneurs paired with technology services and products that help in revenue generation and smooth operation. 

Customers all over the world benefit from affordable and dependable lodging services. Oyo Rooms provides 40+ integrated products and solutions to customers who own and operate over 1 million hotels and home storefronts in over 35 countries, including India, Europe, and Southeast Asia.

Oyo's initial public offering (IPO) was recently canceled citing the hotel room aggregator's massive losses in recent years. According to reports, Oyo lost Rs 3943.84 crores in FY20-21, which equates to a loss of over Rs 76,077 every minute. In the year 2021-22 OYO lost 4050 crores ($526 million)

According to the top hotel industry body, Oyo has been losing money since its inception in 2013, and its total revenue has dropped by 69% from Rs 13,413 crore in 2020 to Rs 4,157 crore in 2021.


Founders: Binny Bansal, Sachin Bansal

Headquarters: Bangalore, Karnataka, India

Founding date: October 2007

Flipkart, a Bengaluru-based e-commerce company founded in 2007 by Sachin Bansal and Binny Bansal, was acquired by US retailing behemoth Walmart in 2018. Flipkart began as an online bookstore before branching out into consumer electronics, fashion, home essentials & groceries, and lifestyle products.

Flipkart also has a stake in Myntra, PhonePe, Ekart, and 2GUD. Tiger Global, Naspers, Accel Partners, Softbank, and Iconiq Capital have all invested. Since then, Softbank has sold its stake to Walmart.

The amazon rival is facing a tremendous loss that amounts to 2941 crores ($382 million). Flipkart Private Limited lost more than 2941 crores in the year 2021-2022 in India, compared to a loss of more than 3100 crores in the previous year. 


Founder(S): Vijay Shekhar Sharma, Amit Veer

Headquarters: Delhi, India

Founding date:2010

Paytm is a payment gateway that accepts payments from both customers and merchants. One97 Communications owns it, and it is backed by investors such as SoftBank, SAIF Partners (now Elevation Capital), Alibaba Group, and Ant Financial.

One97 Communications NSE 1.01 percent, which operates the digital payments brand Paytm, reported a consolidated loss of Rs 2,396.4 crore for the fiscal year 2022, up from Rs 1,701 crore the previous year.

According to stock exchange filings, consolidated revenue for the fiscal year ended March 31 increased by 65 percent to Rs 5,264.3 crore from Rs 3,186.8 crore in FY21.

The consolidated loss for the fiscal fourth quarter increased to Rs 762.5 crore from Rs 444.4 crore the previous year. Revenue increased by 81 percent to Rs 1,648.4 crore from January to March, owing to an increase in gross merchandise value processed through its payment instruments as well as an increase in loan disbursals.

The company lost Rs 778.5 crore on revenue of Rs 1,533.4 crore in the third quarter of fiscal 2022.


Founder(S): Gaurav Munjal, Roman Saini, Hemesh Singh

Headquarters: Bangalore, India

Founding date:2015

Unacademy is an e-learning platform that aims to create a multilingual knowledge repository online. Gaurav Munjal, Roman Saini, and Hemesh Singh founded the Bengaluru-based ed-tech platform to connect expert educators with students looking for quality education across cities. According to the startup, it has over 13 million learners on its platform, over 50,000 subscribers to its Unacademy Plus Subscription, and 400 teachers across 20 exam categories, including competitive ones like UPSC, IIT-JEE, and CAT.

Unacademy, based in Bengaluru, saw its loss increase by 494 percent for the fiscal year ending March 2021. The second most valuable ed-tech startup in India lost INR 1,537.4 Cr in FY21, compared to INR 258.6 Cr in FY20.

Unacademy, led by Gaurav Munjal, saw its total revenue increase by 350 percent in FY21 compared to FY20. In FY21, the startup earned INR 464 crore, up from INR 103 crore in FY20.

In FY21, the startup's revenue operations increased by 514.6 percent. It generated INR 397.6 Cr in operations revenue in FY21, a significant increase from INR 64.7 Cr in FY20.

Unacademy's expenses increased 349 percent in FY21. It incurred total expenses of INR 2,029.9 crores in FY21, compared to INR 452 crores in FY20.


Founder(S): Sriharsha Majety, Nandan Reddy, Rahul Jaimini

Headquarters: Bangalore, India

Founding date: 2014

Swiggy, headquartered in Bengaluru, was founded in 2014 and is India's leading on-demand delivery platform, with a tech-first approach to logistics and a solution-first approach to consumer demands. With a presence in 500 cities across India, partnerships with hundreds of thousands of restaurants, over 5,000 employees, and a 2 lakh+ independent fleet of delivery executives.

Swiggy's revenue fell 23% year on year to Rs 2,145 crore in FY21. Swiggy (Bundl Technologies) reported a 23% year-on-year decrease in revenue to Rs 2,145 crore in the fiscal year 2020-21. (FY21). However, its net loss fell 66% year on year to Rs 1,314 crore, according to regulatory documents obtained by business intelligence platform Tofler. The total expenses of the Bengaluru-based company were Rs 3,310 crore.


Founder(S): Bhavish Aggarwal

Headquarters: Bangalore, India

Founding date:2010

Ola founded by Bhavish Agarwal in 2010 is India's largest mobility platform and one of the world's largest ride-hailing companies, with over 250 locations in India, Australia, New Zealand, and the United Kingdom.

According to regulatory filings, Ola Electric's losses in the fiscal year ended March 2021 was nearly Rs 200 crore, during which time the mobility company transitioned from developing a battery-as-a-service business to manufacturing electric scooters.

The company generated only Rs 86 lakh in operational revenue because it did not sell a single product during the period. Employee benefits accounted for nearly 70% of total expenses.


The Indian startup ecosystem is not prospering well as it did last year. The segment that thrived during the pandemic is now bearing the brunt of the Russia-Ukraine war, which has slowed their ability to raise capital.

According to the most recent IVCA-EY report, Indian startups raised just $1.6 billion in April 2022. This is nearly half of what the same ecosystem raised in April 2021. To make matters worse, no company joined the unicorn club last month, whereas April 2021 kicked off the unicorn creation momentum last year with eight new additions.

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