How disruptive startups are challenging industry giants and reshaping success

IF NUMBERS HAD A VOICE, 2024 would be nothing short of vociferous — a relentless, booming chorus echoing across boardrooms, investor calls, and startup accelerators alike. The numbers are loud: $8.7 billion raised across 81 new funds, a 55% leap from 2023. Early-stage companies are flush with $1.94 billion in fresh capital.

But money, as always, tells only part of the story. Beyond the spreadsheets and headlines, the ever-evolving landscape of Indian startups is redefining what entrepreneurship means.

It was during a keynote address at the Kotak Institutional Equities’ investor conference that Uday Kotak, founder of Kotak Mahindra Bank, set the cat among the pigeons with his comment: “The next generation must work hard and create businesses rather than becoming financial investors too early,” Kotak urged. Instead of managing family offices and portfolios, young heirs, he argued, should roll up their sleeves and build — “real-world businesses from scratch”.

While Kotak’s rebuke was aimed at the gen next of existing business owners, India’s first-gen entrepreneurial engine is very much alive and roaring.

In this swirl of ambition and uncertainty, stakeholders such as Kunal Bahl, co-founder of Titan Capital, are playing their role in helping the startup ecosystem morph from scrappy beginnings to its current feverish pitch. “People ask me: what has changed? Everything,” he says. For someone who has navigated both the chaos and clarity of entrepreneurship for nearly two decades, Bahl mentions that at one point, debates swirled around whether India had 25 million or 50 million Internet users. Now, that number has swelled beyond one billion, turning a once-sleepy market into a digital behemoth where payments, consumption, and innovation collide in unexpected ways. “It’s not additive — it’s compounding. It’s a multiplier effect. Every new connection deepens the opportunity,” Bahl reflects.

Even as Bahl has stuck to his entrepreneurial venture, now listed as Unicommerce eSolutions — India’s largest e-commerce enablement SaaS firm — he continues to play the role of an active operational investor, including in the likes of Ola, Urban Company, Mamaearth, and Razorpay.

At his privately-held family office, Titan Capital, 5,000 startup pitches flood in annually, but only 15 to 20 make the cut. It’s not about betting on trends; it’s about understanding people, execution, and the rigour of the founding teams. “Entrepreneurship isn’t a sprint; it’s a marathon,” he says. “You can’t just dive in. You have to be deliberate about what you’re building because the water level in India is rising. If your boat floats, it’ll rise, too,” says Bahl, who backs 280 startups.

Against such a vibrant landscape, Fortune India, in its own meticulous excavation of the startup universe from Tracxn, a data analytics platform, sought to map out this new terrain by focussing on unlisted startups with operational history of up to 10 years. The results are both impressive and sobering. The numbers exclude edtech owing to industry challenges, and deeptech (including space and defence) as these companies, despite a strong order pipeline, have yet to generate significant revenue. The Top 3 across prominent sectors — including fintech, consumer, agritech, and electric vehicles (EVs) — has amassed a staggering ₹44,817 crore in revenue. But profits? Elusive. The cumulative losses of the Top 3 in the selected sectors amount to ₹10,863 crore. This is the paradox of Indian startups today: a universe of meteoric revenue growth shadowed by mounting losses.

Take fintech. It’s where ambition meets ambition, and giants such as CRED and BharatPe loom large with revenues of ₹2,473 crore and ₹1,486 crore, respectively. Yet, behind the curtain, losses of ₹609 crore and ₹492 crore gnaw at the edges of those glossy success stories. The EV revolution, too, is weighed down by its own gravity. Ather Energy pulls in ₹1,789 crore in revenue but is shackled by ₹1,060 crore in losses.

In agritech, where the goal is nothing less than reimagining India’s agricultural backbone, startups such as DeHaat offer a glimpse of what’s possible. Their ₹2,720 crore in revenue hints at the sector’s potential, but logistical complexities and operational hurdles keep profits out of reach — losses sit at ₹1,133 crore. Meanwhile, the edtech sector, once buoyed by the pandemic’s rush towards digital learning, now feels the weight of reality. Instead, gaming is where the action is with Zupee leading the pack with ₹865 crore in revenue, but losses of ₹37 crore suggest that it’s still early days.

This constant balancing act between growth and sustainability looms large for investors and entrepreneurs alike. “We’re not out of the woods yet. 2024 might have brought better numbers, but the volume of deals hasn’t caught up,” says Neha Singh, co-founder of Tracxn. The so-called funding winter hasn’t entirely thawed. Yet Singh sees signs of resilience — a shift in investor preference from scale to substance, from hypergrowth to healthy financials. “Profitability is back in focus”, she emphasises. The IPO wave speaks for itself; 12 new-age tech companies went public in 2024, raising more than ₹29,070 crore and signalling a return to fundamentals. “But the companies that went public have shown a glide path to profitability,” adds Singh.

For Bahl, the future lies in patience and precision. “We should be chasing Indicons, not unicorns,” he says. It’s about creating firms with real, enduring value — businesses that generate revenue, create jobs, and can survive the brutal tides of economic reality. His investment strategy reflects this philosophy: long-term, deeply involved, and focussed on sectors he understands well. From Shadowfax to OfBusiness, Titan Capital backs startups that have not just shown scale, but are working their unit economics in the run-up to a public market debut.

It’s this philosophy that may well shape the next chapter of India’s startup saga. The glamour of billion-dollar valuations is giving way to quieter, sturdier ambitions — built on patient capital, sound governance, and solid fundamentals. Singh says sectors such as defence tech, spacetech, and battery innovation are beginning to draw serious investor interest. “However, their longer gestation periods demand a different kind of commitment,” she says, adding that patience and strategic thinking would be key here.

Still, the entrepreneurial fire burns brighter than ever. Bahl talks about pitches from first-generation founders in Tier II and III cities, even a 72-year-old entrepreneur on Shark Tank — proof that innovation knows no age or geography. “India’s future isn’t just built in Bengaluru or Mumbai — it’s being shaped in places most of us haven’t heard of yet,” says Bahl.

In the end, the story of Indian startups is not about making it big on the public markets but it’s about resilience, reinvention, and the quiet conviction that real success isn’t measured in valuation headlines but in the enduring legacy of businesses that survive the test of time. And in this vast, turbulent ocean of possibility, the boats are ready — some destined to drift, others set to sail with their masts flying high.