How many Indian unicorns are actually going to make money?

Let me think about profits now.
Let me think about profits now.
Image: Reuters/Kieran Doherty
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India is home to 10 unicorns—startups valued at over $1 billion. And, studies indicate that the country’s rapidly growing startup ecosystem could produce at least 50 more in the future.

However, such massive valuations don’t imply profitability. Of the 10, only two Indian unicorns are currently profitable: Data analytics firm Mu Sigma has made annual profits for three years while InMobi, an advertising technology platform, posted profits in the fourth quarter of 2016.

The rest are still struggling. Online sellers like Snapdeal and Flipkart have been bleeding due to the massive discounts they dole out to woo and retain customers. Advertising and marketing costs, too, are eating into revenues.

Quartz looked at where these 10 startups stand vis-a-vis profitability.


Critics have questioned the business model of India’s largest e-commerce firm, and also its reported $10-billion valuation. For the 2015-16 financial year, Flipkart posted a loss of Rs2,306 crore, though it has been talking about hitting profitability for a while now.

In April 2015, talking to the Wall Street Journal, Flipkart’s then CFO Sanjay Baweja set a two-year deadline. In October 2016, after he quit, Baweja said the firm was “on the path of profitability.” The company’s two fashion retail units, Myntra and Jabong, too, are set turn the corner soon, executives say.

In May 2015, Myntra had said it would turn profitable by the end of fiscal 2016. However, in December 2016, Ananth Narayanan, its CEO, extended the deadline to the end of fiscal 2018. In 2016, Myntra bought rival Jabong for $70 million to create India’s largest online fashion retailer.

Flipkart hasn’t replied to Quartz’s queries yet.


For financial year 2015-16, the online seller made a loss of Rs3,316 crore.

In February 2017, the company’s co-founder and CEO, Kunal Bahl, said Snapdeal will turn profitable in two more years. Its spokesperson told Quartz that this target still holds ground and that the company is “working steadily towards profitability and efficiency.” Rumours have been swirling about a possible Snapdeal-Flipkart merger to take on Amazon, which has been firming up its investment in India. But none of the companies has confirmed this plan.


Hike is a messaging platform with some 100 million users. Founded by Kavin Mittal, son of Sunil Bharti Mittal of telecom services provider Airtel, the company is currently valued at $1.4 billion, according to CB Insights, a research firm. Hike hasn’t issued any guidance on its profitability yet.

“We’re currently focused on engagement and user growth. That’s the focus for us in the next few years, after which we will focus on revenue,” a Hike spokesperson told Quartz in an email reply. “The internet space in India is still at an early stage and we believe in its huge potential…We have a long-term view of the market and the social space,” the spokesperson added.

The messaging service was launched on Dec. 12, 2012, and has received funding from investors including Tiger Global, Tencent, and Foxconn.


The firm is the newest entrant to India’s unicorn club. Founded by Sumant Sinha in 2011, RenewPower is an independent power producer which focuses on clean energy. With investors like Goldman Sachs, the Asian Development Bank, and the Abu Dhabi Investment Authority, the firm is valued at some $2 billion. It joined the unicorn club in February this year. The company did not respond to an emailed questionnaire. On April 05, Renew Power said (pdf) that in financial year 2016-17, it had invested Rs6,700 crore towards adding capacity in wind power generation.

Mu Sigma

The data analytics firm founded by Dheeraj Rajaram has been making profits for three years. It was the first Indian unicorn to hit profitability. For financial year 2015-16, the Bengaluru-based firm posted a profit of Rs462.9 crore, a 22% annual increase. In a filing, the company said the growth came on the back of higher turnover.

The firm has the backing of investors such as Sequoia, General Atlantic, and Mastercard and counts American firms like Walmart, Microsoft, and Dell among clients.


InMobi became the second unicorn after MuSigma to turn profitable, after the company said on April 05 that it made a profit in the fourth quarter (October-December) of 2016. It follows the calendar year for financial reporting. Although the profit is for just one quarter, the company said it has had positive cash-flows for the last few quarters. InMobi hasn’t responded to Quartz’s email yet.

“We became ultra-focused on doing the right deals…This is a big shift from previous years when we were spending freely on expanding in all markets,” CEO and founder Naveen Tewari told the Mint newspaper. The firm, a mobile advertising and technology platform, has struggled in the last few years when its rampant hiring strategy didn’t work and many of its products failed to take off. Investors have also kept away after it faced headwinds—its last funding round was in 2011. The startup was India’s first unicorn and is valued at $1 billion.


In September 2015, Vijay Shekhar Sharma, founder of Paytm, announced that his company was on its way to profitability by 2017.

“Our target to turn profitable by 2017 seems achievable. Next year, we should be able to achieve break-even,” Sharma had said.

In the 2016 fiscal, the company posted a net loss of Rs1,549 crore. Since then, Paytm’s fortunes have seen a revival, mostly due to the Narendra Modi government’s decision to demonetise the country’s high-value currency notes that account for 86% of the currency (by value) in circulation. Since demonetisation, Paytm’s daily transactions have swelled to seven million and the company is today the largest digital wallet service provider in the country.

All that means that Paytm could see profitability sooner than expected. “We are pursuing profitability in net contribution margin and owing to the recent surge in the payments business and added investments required for the payments bank, the timeline to profitability will move forward,” a spokesperson said.


Uber’s fiercest rival in India, the homegrown taxi hailing app had said last November that it will turn profitable in three years. “We are improving our profitability every week and month,” Bhavish Aggarwal, the co-founder and CEO of Ola, had told Quartz in November 2016. “In many cities, we have already reached a break-even, and are on the path to achieving that in many other cities. As a company, we hope to break even within two-to-three years.”

Ola, founded in December 2010, is currently present in over 102 Indian towns and cities with over 500,000 taxis and auto-rickshaws. The company is yet to clarify if it has changed the deadline for profitability.


In October 2016, Sanjay Sethi, co-founder and CEO of Shopclues, said that his company would become India’s first e-commerce firm to become profitable by 2017.

“We aim to attain EBIDTA (operational) profitability sometime in Q2 next year,” Sethi said. “According to my back-of-the-envelope calculations, I think ShopClues will be the first e-commerce company to get profitable.”

However, since then, the Gurugram-based firm’s reputation had taken a hit when Sandeep Agarwal, former CEO, accused his wife and the company’s co-founder, Radhika, of altering his voting rights and publicly questioned her credentials.

Shopclues is yet to respond Quartz’s queries on profitability targets.


In February 2016, India’s largest restaurant search portal, Zomato, announced that it was making profits in some of the countries it was present in.

Of the 23 where it operates, the startup announced an operational break-even in India, the UAE, Lebanon, Qatar, the Philippines, and Indonesia. However, for fiscal 2016, the Gurugram-based firm made losses of Rs492.3 crore. Launched in 2008, Zomato has received $225 million in funding so far.

Zomato, however, hasn’t so far given any timeline on turning profitable. It hasn’t responded to our queries.