The number of unicorns in the Indian startup ecosystem is set to go up by around a fifth in FY25, with around 20-odd soonicorns rapidly closing in on the magic number.

Among the probables are online ticketing platform Bookmyshow, fintechs Navi, Paymate, Refyne, Clear, Ind Money, and Jupiter, agritech firm Ninjacart and e-commerce platform Biz on Go. All these are currently valued in the range of $600-930 million.

The two that are closest to the finish line are fintechs Turtlemint and Paymate with valuation of over $900 million.

The last fiscal year ended with around 112 unicorns with the addition of InCred Finance in November when it raised $60 million in a series D funding. According to Invest India these unicorns have a collective valuation of over $350 billion. The soonicorns currently have a valuation of around over $15 billion, according to data collated from Inc42 and releases issued by the companies.

Last year was the slowest for the startup sector, due to the funding winter that saw lower fund commitments from investors and smaller fund raises, as bigger private equity firms and late-stage venture funds were conspicuously absent. There were only two additions to the unicorn club, Zepto and InCred. The year before there were 22 unicorns with a total valuation of over $29 billion, , compared to 45 unicorns with a valuation of over $102 billion in 2021.

Fintech heavy

The unicorn landscape is largely fintech heavy and among the soonicorn universe around a third are fintechs. In fact half of the startups expected to join the unicorn club this year  are fintechs.

The growth of digital payments systems in India and the government thrust on this sector had led to an unprecedented growth in fintechs.

In a recent report Grant Thornton said that fintechs in India were getting a boost from the Reserve of India’s digital lending guidelines, attracting considerable investor interest in the sector.

The growth of fintechs has also partly to do with the opportunity in India to deliver financial solutions to those who do not have access to traditional banking systems. “In developing nations, digital innovation by fintech companies has allowed entire economies to bypass the high-street bank system and offer a multitude of options to people who would likely be excluded from the traditional banking system,” a blogpost on the World Economic Forum website said.

Cash burn

A quick look at the reported financials of the soonicorns over the last two years show that they are still burning cash barring a few of them, many are still in the red. Staff expenses and marketing expenses are still burning holes in their pockets, though what is encouraging is that they are selling more as evidenced by their increasing revenues.