'Stuck in traffic': Sorin Investments founder Sanjay Nayar on Bengaluru's low tech IPO count

Why has Bengaluru, hailed as India's tech capital, seen far fewer initial public offerings (IPOs) from technology companies compared to the national capital Delhi?

"You guys are stuck in traffic half the day," Mumbai-based Sorin Investments founder Sanjay Nayar told a packed hall at Bengaluru’s ITC Gardenia during the second edition of Moneycontrol Startup Convention.

Bengaluru-based startups staying away from Dalal Street has been a matter of heated debate.

The Bengaluru market has become “very incestuous”, since everyone, including venture capitalists, is here, the private equity veteran said on a more serious note.

"You come to Mumbai and see the struggles you live in. Real businesses get built despite the struggles of where you live and how you travel," he said.

Also read: Bengaluru founders should move to Mumbai to learn how to build serious businesses: Sorin Investments’ Sanjay Nayar

Prashanth Prakash, the founding partner of Accel India and chairman of the Karnataka government's Startup Vision Group, defended the city, saying, “Good companies will come from Bengaluru”.

"I think the companies that are sustainable and will create great long-term IPO stories will happen from Bengaluru. Delhi has an initial good set of companies that have gone IPO and that's great. I know there's a list of companies that are in the (IPO) process from Bengaluru. In six months, I think we will have a different story," Prakash said.

Bengaluru-headquartered Ola Electric made a robust market debut on August 9 when the stock was locked in a 20 percent upper circuit. On August 12, too, the electric two-wheeler company’s share surged another 20 percent to get locked at Rs 109.44.

Food and grocery delivery firm Swiggy, which is also based in Bengaluru and counts Accel among its backers, has also filed for an IPO through the confidential route in April this year.

Also read: Investors want diversification: Swiggy-backer Accel on upcoming IPO amid Zomato surge

As reported by Moneycontrol, Ola Electric's cross-town rival Ather Energy is also looking to tap the primary market by 2025 and has picked HSBC Holdings Plc, Nomura Holdings Inc. and JPMorgan Chase & Co to help arrange its IPO.

Walmart-backed digital payments major PhonePe also has plans to go public.

"One of the major motivations for moving to India was that we want to list here. This is our home country, this is our market, we will list here. We've also said that we will list once we are convinced that we are sustainably profitable" PhonePe co-founder Sameer Nigam said during a separate fireside chat at Moneycontrol Startup Conclave.

"I think the Bengaluru ecosystem has a bunch of really exciting companies lining up for IPOs and I think they are just earlier in their life cycle (as compared to Delhi companies)" he said.

Watch the full livestream of the Moneycontrol Startup Conclave 2024