India’s 91 Unicorns spent cash of over ₹300,000 crores, posting a total net loss of over ₹63,000 crores. Now before you write off all these expenses as “cash burnt”, let’s zoom out and look at the bigger picture.
Think of it this way, money spent by one Startup is creating a market for another. So, the huge amounts of money spent by Startups is brewing up an economy in itself comprising of stakeholders ranging from digital marketing to data security firms, from Logistics to SaaS companies, and so on. Here are a few examples to explain this better:
With the rise in the volume of D2C and Ecommerce players, a bigger market is getting created for Logistics companies (as their services will be sought to make deliveries to customers) and for Digital Marketing firms (as they tend to spend heavily on marketing).
A rise in Delivery & Logistics Startups in turn has created a massive gig economy in our country, one which was almost non-existent 5 years ago.
A general increase in the volume of Startups in the country has created a huge market for SaaS, Enterprise Tech and Data Security firms.
And above all, India’s tech ecosystem has created top quality job opportunities for a generation that loves to be challenged, pushing them beyond their limits and inspiring them to innovate in every step of the way.
You get the idea right? So, we disintegrated the ₹300,000 crores into expenses that generated opportunities for these stakeholders. Have a look:
Employees - ₹54,000+ Crores ($6.75+ Billion) was spent in the form of Salaries, Wages, ESOP Pay-outs and Staff Welfare expenses.
Events and Marketing & Advertising Firms - ₹22,000+ Crores ($2.75+ Billion) was spent in the form of advertising, marketing, promotion and sponsorship expenses.
Logistics Partners - ₹16,000+ Crores ($2+ Billion) was spent in the form of transportation, warehousing, packing and packaging costs.
Legal & Accounting Professionals - ₹5,600+ Crores ($0.7+ Billion) was spent in the form of legal, professional and audit fees.
Governments - ₹3000+ Crores ($0.38+ Billion) was spent in the form of duty, cess, income taxes and license fees to State and Central Governments.
This article is a part of the January'24 edition of our Startup Newsletter. Here's the complete publication: