“(A) Startup which has gone on to become a unicorn, must go on to become a big company in the future. That can only happen if you have good governance, proper audits, a good CFO, and if you have all the norms of good governance,” said Kant at the CII Unicorn Summit in New Delhi.
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Many startup entrepreneurs, being classic innovators, often prioritise innovation and disruption over corporate governance, he said.
In November last year, ET reported that a series of serious corporate governance lapses across well-funded startups in India had turned investors wary of writing big cheques when the sector is also facing a funding winter.
“We need to ensure that Indian insurance companies, Indian pension funds, Indian large families and large Indian companies, all invest in our startup movement. India cannot grow on the back of foreign money coming in all the time. India’s startup movement must be driven by India’s finance,” he added.
Kant said the country together with the private sector “should think of creating a $5 billion fund for unique patient capital and therefore you need to create a fund of funds which will then support a number of venture capital funds to do due diligence and support young deep tech startups.”
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According to the ‘Unicorn 2.0: Adding the Next Trillion’ report released by CII on Thursday, sectors such as retail, e-commerce, financial services, manufacturing, and software-as-a-service (SaaS) along with digital are expected to fuel significant expansion in the coming years.“From access to capital and strategic mentorship, to fostering an ecosystem that nurtures talent and encourages disruptive thinking, the factors influencing startups’ sustained growth are multifaceted,” said Abhiraj Singh Bahl, chair, CII unicorn forum, and cofounder of Urban Company.
The report also highlighted that India has 114 unicorns, ranking third globally after the US and China. These unicorns, along with around 100,000 startups, have played a substantial role in contributing 10 to 15 percent to India’s GDP growth from 2016 to 2023.