Meesho CEO Vidit Aatrey highlights a trend of Indian startups skipping late-stage private funding to list early, banking on the depth of the local market. While this offers new avenues for capital, investors are increasingly prioritizing profitability over high-growth narratives, following a period where over half of recent listings struggled to hold their value.
The landscape for Indian startup funding is experiencing a notable shift as more founders consider bypassing traditional late-stage private capital in favor of an early public debut. During the ET Startup Awards 2026, Meesho CEO Vidit Aatrey pointed to the deepening maturity of the Indian equity markets as a key catalyst for this change. Unlike in the United States, where public listings are often reserved for large, established enterprises, the Indian ecosystem is increasingly accessible to a wider spectrum of companies.
This strategic pivot represents a departure from the capital-intensive fundraising cycles that defined the previous decade. By accessing public markets sooner, startups can tap into a broader investor base. However, industry leaders emphasize that this route requires a fundamental change in how companies operate. Transitioning to a public entity demands high levels of corporate governance, financial discipline, and operational transparency that private startups may not have fully developed.
Groww CEO Lalit Keshre, who participated in the discussion, warned that public listing is a continuous commitment to accountability rather than a singular milestone. Companies must avoid the temptation of inflating expectations to drive IPO valuations. The shift requires moving away from the 'growth-at-any-cost' mindset that characterized earlier funding rounds, toward models that demonstrate sustainable profitability and clear data-backed growth.
The enthusiasm for early listings comes at a time of record-breaking activity, with the Indian market witnessing 34 mainboard IPOs in September 2026 alone, raising approximately ₹39,340 crore. However, the market’s appetite is becoming increasingly selective. Investors are paying close attention to company fundamentals rather than speculative future growth, particularly because the track record of recent new-age listings has been mixed. As of April 2026, data showed that approximately 58% of IPOs launched between January 2025 and March 2026 were trading below their offer prices.
This divergence between the number of companies choosing to list and the performance of those stocks highlights the reality of current market conditions. Regulatory changes, such as the ban on mutual fund participation in pre-IPO placements implemented in late 2025, have also forced a re-evaluation of how startups prepare for public entry. For investors, the trend toward earlier IPOs means the quality of disclosures and the ability to maintain consistent cash flows will remain the most critical monitorable in the coming quarters. Startups that cannot meet the transparency and profitability expectations of public shareholders risk facing significant valuation recalibration once they hit the secondary market.