Infosys Co-Founder Narayana Murthy on Thursday said that some of the venture capital flowing into the start-up ecosystem is akin to ponzi schemes.

Murthy said some venture capitalists say they give importance to only the top line and not the bottom line. “In some ways, this has also become a Ponzi scheme, because you know I am in series B…I sell my first deal at a profit, I get off and it is the series Z fellow that is left with the tin box.”

Murthy’s comments come at a time when the Indian start-up ecosystem continues to face a massive funding crunch. He does not believe that young founders are to blame for not being able to keep their spending in check but it is up to the board of Directors to keep a check.

Speaking at the Nasscom Technology Leadership Forum 2023 , Murthy said, “Frankly I dont hold ..(founders) as responsible. I think, the venture capitalists who provide money for them, then the advisors they have in terms of board of directors…they have to tell them (the founders) to accept deferred gratification. To realise that sacrifice in the short and medium term will indeed lead to much bigger returns in the long run.”

No risk of losing jobs

On the sidelines of the NTLF, Murthy also added that coders losing jobs to generative AI technologies like ChatGPT “will never happen”

“In 1977-78 there was a thing called program generators. Everybody said the youngsters will lose all jobs, it didn’t happen….. the human mind is the most flexible instrument. It can adapt very well. And all that happened was people started solving bigger and bigger problems, which these program generators could not handle,” he said.