MUMBAI: In a first, three Indian startups are going public in a week. Many early investors are minting money with IPOs set to become a dominant mode of exit for most of them going ahead — a booming IPO market with growing appetite for new-age firms have made it easier for startups to give exit to investors through public debut.Venture capital firm Peak XV Partners (formerly Sequoia India and Southeast Asia), one of the early backers of local startups has made nearly 40 times return on its investments in Pine Labs and Groww by selling partial stakes in the companies.“In Pine Labs, the highest ownership Peak XV reached was around 72%. During 2018-21, the funds sold a significant stake in the company, having already realised significant returns on invested capital. Whatever we have now is on top of that,” Shailendra Singh, MD at Peak XV Partners told TOI.Singh did not specify the amount of stake it will hold in Groww and Pine Labs after their IPOs but said it will be in the range of late teens. “Inherently, we are happy to stay invested. Both the companies have built structurally well positioned businesses. As Indian markets deepen, both these companies will continue to compound,” Singh said.
Lenskart and Groww have already made their debut on the bourses earlier this week while Pine Labs is set to get listed on Nov 14.Groww, which listed at a 12% premium to its IPO price, has returned (returns on their investments) at least two US funds fully, said the firm’s early investor and former MD of US startup accelerator Y Combinator’s growth fund Anu Hariharan. “Many US LPs (limited partners) have asked me if Indian investments would ever make money. Ecosystems take time but here’s Groww — returning capital many times over and returning at least two US funds fully and likely delivering one of the best IRRs of the decade.”Groww, which is now the biggest broking house in India in terms of number of clients, is also the first Indian startup from Y Combinator’s stable to go public. The firm’s roughly 10% stake in Groww is valued at over Rs 8,000 crore while Peak XV’s nearly 17% share now is valued at over Rs 13,000 crore. “With the current size and scale of IPOs, this (IPO) will become more dominant mode for investor exits in the future,” Singh said.SoftBank also reaped gains through investment in Lenskart. The Japanese firm had invested in the startup at $1.2 billion valuation and with Lenskart’s IPO valuation shooting up to nearly $8 billion, the technology investor’s remaining 13.1% stake is valued at over $1 billion. SoftBank has already recouped $180 million from secondaries over last two years over its investment of $250 million in Lenskart, sources said.
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