Zomato Co-founder Deepinder Goyal on the Success of the IPO and The Path Ahead

Zomato's IPO

The aftermath of Zomato IPO’s opening and co-founder Deepinder Goyal’s reaction.

On July 23rd 2021, Zomato, a food logistics company, became the first unicorn to launch an Initial Public Offering (IPO) in India. The IPO opened for subscription on July 14th and closed on July 16th. It was oversubscribed 38.25 times. At its debut on Dalal Street, the issue price was Rs. 76 (1.03 US$) per share, with the minimum order quantity of 195 shares. Soon after its opening, the share price jumped by 66%, thanks to the number of people interested in buying its stock. Finally, it listed at more than 50% premium. The IPO stocks opened at Rs. 116 (1.56 US$) per share, increased to Rs. 138 (1.86 US$) and finally closed at Rs. 125 (1.69 US$) per share for the day. After the IPO, Zomato is valued at 13 billion US$.

The company’s goal is to be an investor-friendly company. In keeping with that, they decided on the issue price of Rs. 76 for their IPO opening. According to the co-founder Deepinder Goyal, Zomato wanted to keep enough money on the table so that everybody who decides to join in has an upside.

Goyal is worth 650 million US$ after the IPO opening, making him an ultra-tech millionaire in the startup economy – an exhilarating feat. In a letter to his shareholders post the success of the company’s IPO, he said, “The tremendous response to our IPO gives us the confidence that the world is full of investors who appreciate the magnitude of investments we are making, and take a long term view of our business.” On what urged him to finally take Zomato public in July 2021, he credits his team’s “why not now” mindset.

The credit of its success, in part, goes to Goyal’s mindset and determination; he knew that it was the natural next step for Zomato. In September 2020, Goyal sent out a letter to Zomato’s stakeholders informing them about the company’s plans to go public. The letter noted, “We are going to relentlessly focus on 10 years out and beyond, and are not going to alter our course for short term profits at the cost of long term success of the company.”

The IPO was backed by renowned companies, like Morgan Stanley, Tiger Global and Fidelity Investments. In addition to catering to its shareholders, Zomato is also making special provisions for their employees to share in the listing. Goyal, in a letter to his employees, said, “Our finance/legal teams are working hard to take us to IPO sometime in the first half of next year. We hope to create a lot of value for our current employees who have ESOPs (employee stock ownership plans) sometime in the next year.”

The success of Zomato sets a noteworthy precedent for other Indian startups, encouraging them to go public. In the coming months, we can look forward to startups like Nykaa and PayTM launching their IPOs too.

SHARE THIS STORY

Share on facebook
Share on twitter
Share on linkedin
Share on email

RELATED POSTS

A Step-by-Step Guide

The Power of a Wikipedia Page for Your Business: A Step-by-Step Guide

The one thing that builds trust between your company and its potential customers is having its own Wikipedia page. It is the first thing that shows up when someone looks up your company (besides your website of course!) and gives potential customers all the information they might need about your business.

Top 5 Unique Pet Care Startups to Watch

From Diagnostics to Play Dates: Top 5 Unique Pet Care Startups to Watch

All pet owners out there understand the feeling of wanting to do whatever it takes to make their furry companions’ lives just a little bit more comfortable. It is perhaps that exact feeling that has made the average pet owner spend over US$1,300 on pet care a year. According to a 2021 survey conducted by the market research firm OnePoll, 52% of Americans spend more on their pets than they do on themselves each year.

Course5 Intelligence Gains US$55 Million Funding Boost

Course5 Intelligence Gains US$55 Million Funding Boost; Closes First Round Successfully with 360 ONE Asset’s Tech Fund

Analytics and artificial intelligence (AI) solutions company Course5 Intelligence has recently announced its plans to raise a funding round of USD 55 million. The initial closing of the funding round was achieved through the participation of 360 ONE Asset Management Limited’s Tech Fund, which specializes in investing in promising technology companies. Leading the round, 360 ONE Asset invested US$28 million in Course5.

How to Find Your Company’s North Star Metric to Ensure Success

How to Find Your Company’s North Star Metric to Ensure Success

In the world of business, having a singular goal to focus on can be the key to success. That’s where the North Star Metric (NSM) comes in. Coined by startup investor Sean Ellis, the NSM is the measure of the value a company is delivering to its customers and is used as a means to predict the growth of the business.

Video-Games-That-are-Accessible-for-the-Visually-Impaired

Breaking Barriers: Video Games That are Accessible for the Visually Impaired

In recent years, the gaming industry has made significant strides in promoting inclusivity and accessibility for players of all abilities. While video games have long been regarded as a visual medium, game developers and designers have worked to break barriers and create gaming experiences accommodating the visually impaired.