Zomato is the first of many new-age startups to announce an IPO timeline. Retail investors in India have been eagerly waiting for the IPO of these startups. In this article, we look at what would have happened if you were an angel investor who invested in Zomato during their first angel round.
Since Zomato made a firm announcement about its IPO timeframe, there has been a lot of enthusiasm in both the startup sector and the stock market. This is the first of many IPOs from India’s new-age firms. We’ve all heard of retail investors in the United States engaging in IPOs of businesses like Airbnb and, in some way, becoming a part of the startup revolution. Retail investors in India, on the other hand, have been waiting a long time to get a piece of the action.
SEBI regulations were seen favourably by startups, and there was much speculation that prominent Indian startups may seek to list on overseas stock exchanges. When SEBI changed various listing requirements in March 2021, IPO chatter of Indian companies gained traction in the business media, and retail investors have been eagerly awaiting the IPO.
While startup investments can be dangerous, and one can lose their entire investment, this essay will focus on what would have happened if you were an angel investor who put Rs 10 lakh in Zomato shares during their first angel funding round in 2010.
Here is what happened to the investment made by a hypothetical angel investor Deepika Kapoor who took part in Zomato’s first angel round.
Deepika was introduced to one of Zomato’s co-founders in 2010 by a common friend who told her that they had an interesting startup that aggregated eateries. As a foodie herself, she was able to connect with the concept right away and believes that this startup has a lot of promise.
Furthermore, she was impressed with the founders’ qualifications and was confident that these men would come out on top. While she was aware that startup investments may be extremely hazardous, she was willing to lose Rs 10 lakh if things did not go well for the firm.
In July 2010, she eventually decided to invest in Zomato’s fundraising round.
The Rs 10 lakh that Deepika invested at that time has turned into Rs 224 crore in these 11 years and she is understandably still holding on to her equity.
Zomato founder Deepinder Kaur’s net worth has increased by 44 times in three years. She is now worth Rs 4.4 crore which is 44 times the original investment in about three years! Her shares in Zomato have gone from Rs 50 lakh to Rs 1.11 crore in two years.