Mid-sized startups ditch unicorn chase, pursue IPOs earlier

According to one of the people cited above, these startups are likely to raise ₹400-600 crore through IPOs.

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“Many of the companies that are being approached today prefer the IPO route rather than growth capital as they are seeing some of their peers command rich valuations right now,” a second person said.

There are several factors pushing companies to IPOs: strong domestic liquidity, improved governance, a greater focus on profitability among issuers, better investor sentiment, and more deliberate exit planning. An earlier IPO also allows founders to dilute less, reset investor expectations, and reduce the pressure created by repeated private-market exit cycles. Founders are also increasingly turning to public markets at an earlier stage to reduce pressure from private investors.

“These companies are in active discussions with advisors and bankers to evaluate an IPO,” a third person said, speaking on condition of anonymity.

My Gate did not respond to queries. FabHotels filed its draft red herring prospectus last month to raise ₹250 crore.