Bengaluru, India’s thriving startup hub, is home to more than 40 unicorns valued at over $1 billion. However, 95 percent of these startups, including publicly listed companies, reported losses totalling Rs 16,389 crore in the fiscal year 2024. Notably, certain startups were excluded from this analysis due to unavailablity of their FY24 data.
According to the data sourced from cloud-based marketing platform Tracxn, only seven Bengaluru-based unicorns were profitable in FY24 (Zerodha, Postman, Moneyview, Perfios, Zeta India, Razorpay, and Groww), registering a PAT of Rs 6,209.6 crore, with Zerodha’s net profit of Rs 5,496 crore being the highest among them.
It must be noted that the Karnataka government allocated Rs 1,000 crore in its recent budget announcement to stimulate the startup ecosystem in Mysuru, Mangaluru, Hubballi-Dharwad, and Kalburgi. The state government earmarked Rs 300 crore for Fund-of-Funds and a corpus of Rs 100 crore for Deep-tech development.
Some of the prominent Bengaluru-based startups, whose valuations have got attention but are bleeding cash include Zepto (FY24 loss at Rs 1,248 crore), Cred (Rs 1,644 crore loss), Ola Electric (Rs 1,584 crore) and Curefit (Rs 888.5 crore), respectively.
Similarly, unicorns headquartered in Mumbai are also grappling with substantial losses. As per the Storyboard18 analysis, MyGlamm, PharmEasy, and boAt are among the unicorns, whose losses have mounted to Rs 3886.91 crore in FY24 (excluding four companies).
However, unicorn startups such as BillDesk, Dream11, InCred, BrowserStack, CoinDCX, and Upstox have remained successful enterprises in FY24.
According to Ashutosh Kumar- General Partner at Expert DOJO, “A strong startup ecosystem requires businesses that create value and generate profits. If companies continue to operate with high losses and depend only on funding rounds, the industry becomes unstable. Market corrections will eventually force businesses to focus on profitability. Companies that prepare early by managing costs and building sustainable revenue streams will be better positioned for long-term success”.
In the Delhi-NCR region, over half of the 30 unicorns suffered losses of Rs 6,228.45 crore in FY24, including Paytm, Physics Wallah, BharatPe, etc.
“Start-ups built on inflated valuations without a clear path to profitability are setting themselves up for failure. While high valuations may attract investors and fuel rapid expansion, they create an unsustainable cycle of cash burn, market instability, and talent drain. When the financial reality doesn’t match the hype, down rounds, layoffs, and eventual shutdowns become inevitable. True success lies in building businesses with strong fundamentals—focusing on profitability, sustainable growth, and long-term value rather than short-term valuation spikes,” Dishi Jain, co-founder, unHR said
A report by consultancy firm Bain & Company revealed that venture capital funding rebounded to $13.7 billion in 2024, up 43 percent year-on-year. Tech-first sectors including consumer technology, software and SaaS (software-as-a-service), and fintech, secured over 60 percent of the total funding. Consumer technology emerged
as the dominant sector, attracting $5.4 billion in funding, more than double compared to 2023.
However, recently Kunal Bahl, Co-founder of Titan Capital and Snapdeal suggested startup entrepreneurs focus on scaling the business quickly and profitably. Instead of chasing unicorn status.
“India’s startup ecosystem needs sustainable, enduring businesses, not just high valuations driven by private market sentiment. The real foundation of a thriving economy is profitable, long-term companies—just like how the US tech giants started in the ’80s and ’90s,” Bahl added.
A business should use funding to build a solid foundation rather than relying on constant capital inflows. Companies that balance growth with financial discipline can sustain themselves even when the funding environment changes, Kumar said.