INDIAN STARTUPS, INVESTORS PRESS PM FOR DIRECT OVERSEAS LISTING

MUMBAI: Prominent Indian startups, investors and investment advisors have urged Prime Minister Narendra Modi to allow startups to directly list abroad. The signatories to the letter include unicorns such as Byju’s, Swiggy, Cred, Bharat Pe, and Urban Ladder, and heads of many investment firms who have invested in Indian startups.

The signatories called it the “single most significant big bang reform for the startup ecosystem”. An overseas direct listing would raise the profile of these startups, make a greater capital pool available to them, and allow specialized investors to invest in these companies, especially in sectors such as software-as-aservice, insurance technology, business to business logistics, genomics, and biotechnology, they said.

“If India wants to produce multinational tech giants, permitting our startups to access global capital by listing on international exchanges is an absolute must-have,” says the letter dated July 29.

The names include Tiger Global Management partner Scott Shleifer, Falcon Edge co-founder and partner Navroz D. Udwadia, Norwest Venture Capital partner Niren Shah, Lightspeed India partner Bejul Somaia, Matrix Partners India managing director Vikram Vaidyanathan, Sequoia Capital India partner Rajan Anandan, Elevation Capital partner Ravi Adusumalli, and Nexus Venture partners Jishnu Bhattacharjee.

Inability to list is a major impediment to growth ambitions and a reason why many of them move their base overseas, reads the letter. Mint has seen a copy of the letter, which also notes that overseas listing would encourage more foreign investors to back startups.

Many tech startups are building products and services that compete globally, which is why an overseas listing would allow these firms to compete with larger firms listed in the US and Singapore, the letter argues.

The letter, which has 22 signatories, also notes that the government “showed intent to allow direct overseas listing” in September 2020 and allowed for some exemptions in February 2021 for firms listing overseas.