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Infosys’ co-founder and Axilor Ventures Chairman Kris Gopalakrishnan has made a strong case for start-ups to think of ‘initial public offering’ to tide over the fund crunch and provide longevity to their fledgling enterprises.
“Start-ups are hesitant to do IPO, which is not difficult. My biggest issue with the start-up ecosystem today is that they are not doing an IPO. Let the Indian public own these companies. They should get the wealth being created,” he said while inaugurating the fifth edition of the two-day ‘Seeding Kerala’ being organised by the Kerala Start-up Mission (KSUM) here on Friday.
“India has $2 trillion of wealth in private hands. Less than one per cent is invested in the start-up ecosystem. We need HNIs’ money going into start-ups,” he said.
Gopalakrishnan advised start-ups to take minimum funds from angel investors, friends and families. They have to create a minimum viable product, and establish unit economics and a profitable model, he underlined.
Role of MSMEs
Noting that the Kerala community is innovative, entrepreneurial and action-oriented, he opined that the start-up ecosystem in Kerala has started getting recognition for its innovation, ideas and path-breaking initiatives.
“Studies have shown that the MSME sector is the backbone of any economy. Over 60 per cent of jobs are created through them. Interestingly, the maximum number of jobs are created in the first five years of the business of the start-ups. We want a large number of MSMEs,” he stressed.
M Sivasankar, Principal Secretary (Electronics and IT), Government of Kerala, who presided over the function, said, “One of the ways to address scarcity of fund is to tap the funds from the alumni meet of engineering batches. Besides, we need to create networks of people, who believe in Kerala to invest.”
Saji Gopinath, CEO, KSUM, said India is the third-largest ecosystem for start-ups. “We have close to around 28,000 start-ups registered with the Department for Promotion of Industry and Internal Trade (DPIIT) and 60 per cent of them are located in three of four cities. This shows the high growth of non-Indian industries, which play a pivotal role in growing such ecosystem,” he said.
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